Car Allowance Rebate System

The Car Allowance Rebate System (CARS), colloquially known as "cash for clunkers", was a $3 billion U.S. federal scrappage program intended to provide economic incentives to U.S. residents to purchase a new, more fuel-efficient vehicle when trading in a less fuel-efficient vehicle. The program was promoted as a post-recession stimulus program to boost auto sales (which had declined due to the effects of the 2007–2008 financial crisis, leading to the Great Recession and 2008–2010 automotive industry crisis) while putting more fuel-efficient vehicles on the roadways.

The program officially started on July 1, 2009, the processing of claims began July 24,^[2] and the program ended on August 24, 2009, as the appropriated funds were exhausted, having scrapped 677,081 vehicles.^[3][4] The deadline for dealers to submit applications was August 25.^[5] According to estimates of the Department of Transportation, the initial $1 billion appropriated for the system was exhausted by July 30, 2009, well before the anticipated end date of November 1, 2009, due to very high demand.^[6][7][8] In response, Congress approved an additional $2 billion.^{[6][7][9][10]}