The average vehicle being traded in gets about 15.8 miles per gallon (6.33 gallons per hundred miles), and the average new vehicle that replaces it gets about 25.4 m.p.g. (3.94 gallons/100 miles).There is substantial fuel saving in this. As Fat Knowledge has pointed out (and Edward Glaeser agrees),
The jump from 10 to 20 m.p.g., for example, saves more gas than the one from 20 to 40 m.p.g. The move from 10 to 11 m.p.g. can save nearly as much as the leap from 33 to 50 m.p.g.Mr Glaeser goes on to say that this is better than high-speed rail because the savings start immediately. But it reinforces our car dependent way of life. And as the Wall Street Journal points out, it's really expensive.
In a nutshell, getting older cars off the road and substituting them with more fuel-efficient models appears to cost about $365 for each ton of carbon-dioxide emissions that are saved. ... The government estimates of the cost of carbon emissions ... are in the neighborhood of $28 a ton. So, Mr. Knittel asks, could the program ever actually be cost-effective, environmentally-speaking? Sure—if all the clunkers had stayed on the road, racking up mileage and emissions year after year for 60 years each, then it actually makes sense.Buying more fuel-efficient cars does "save money" for the drivers, but the bill only benefits people who can afford to drive. Since in general, people that drive to work are wealthier than those who take public transit, the Cash for Clunkers program, in general, does not help the people that need it most. One even greener rider for the bill that would help the less wealthy would be to allow the $4500 credit to be used for mass transit passes.