Cash for Clunkers kicks off tomorrow, and anticipation is high that the program will help jump start the lagging auto industry.  But, on the eve of the program's implementation, some are warning that consumers who want to take advantage of it need to have a game plan.

Bloomberg explains, "President Barack Obama's "cash-for-clunkers" program expected to begin July 24 to jump-start new-car sales may depend as much on consumers' negotiating skills as meeting the rules to qualify for a rebate."  Bloomberg interviewed Jeff Bartlett, deputy online autos editor for Consumer Reports.  He told them, "It can be tricky getting the full value of incentives out of car dealers . . .  That may be true with the clunkers program, unless consumers have a strategy before they arrive at the showroom."

How can you make sure you get the full value of the voucher? Know if your old car qualifies for the program before you go.  Negotiate the price of the new car before bringing up the voucher.  That way, the voucher can be applied to the lower price you've negotiated.  Also, be aware of any other deals or incentives the car maker is offering. You can see the latest discounts on our Car Deals page.

The San Jose Mercury News also adds  that the program may not be a great deal for all buyers, since if you choose to use it, you'll be giving up the trade-in value of the car. They point out, "Theoretically, you could turn in your 2002 Acura MDX, with a combined city/highway mileage of 17, under the voucher program. But you'd be crazy to because the car would sell for about $10,000 - which is $5,500 more than you would get through the voucher program."  On the other hand, "The perfect ‘cash for clunkers' trade-in: a 1994 Oldsmobile Cutlass Supreme, which Kelley Blue Book estimates is worth $700 to $2,130, depending on the car's condition. The voucher would give you at least $1,400 more."

The Washington Post points out that the credit can mean a significant savings for buyers, even if they are financing the purchase of a new car.  One of their bloggers writes, "Let's say we end up spending $20,000 and qualify only for the $3,500 cash-for-clunkers credit. That takes our purchase price down to $16,500. We plan to put about $5,000 down, so we would finance $11,500." She then calculated what her monthly payment would be, keeping an eye on the amount of interest paid over the life of the loan. "Using Bankrate's auto loan calculator, assuming 9.2 percent interest, I found my payments would be $287.27 per month, paying $2,289.02 in interest. That's still less than the $3,500 federal credit. If we were to save money for a year and pay for the new car in cash, we would receive roughly $800 for our trade-in and save $2,289.02 in interest -- $3,089 total. Again, less than the credit." 

The verdict?  While the smart money says to save and pay cash for a new car, not everyone's in that position -- and for a lot of buyers, the government credit will cover the interest on a new car loan.  That means that those who can make the numbers work are as good as paying cash for the new car.  Even better news is waiting Cash for Clunkers buyers who qualify for zero-percent financing -- something that Chevrolet and Chrysler are offering right now.

If you're interested in the Cash for Clunkers program, check out our Cash for Clunkers page.  For the latest news on the program, check out Cash for Clunkers news. If you already know which car you want, you can contact local dealers here. If you want to check out what incentives car companies are adding on top of cash for clunkers, check out our Cash for Clunkers deals.