Have you gotten sticker shock when you needed replacement tires for your car? Chances are you may have expensive non-standard tires.

Automakers create multiple lines of a single vehicle at different price points. One of the up-sells they add to the pricier lines are fancy wheels that are larger than usual tires.

Some models even have speed-rated tires that are designed to perform at 149 mph or higher. We've all seen the commercials with stunt drivers tearing it up on closed roads. It's like James Bond syndrome! But how often do you drive even 100 mph?! Do you really need those high-performance tires?

So Clark is recommending you check out the tire size and type before you buy a car. Or simply ask the dealer about the replacement tire price. Of course, for many people style is king and they don't care if they have to pay extra. But if you do care, use TireRack.com to check tire prices.

The single most reliable car in America is a hybrid, according to the December issue of Consumer Reports -- though it's not the one you're probably thinking!

Top reliability honors go to the new Honda Insight hybrid, which looks just like a Prius. But overall, Honda came in at No. 2 for brand reliability.

The No. 1 brand for reliability is Toyota's Scion. Toyota's own nameplate is No. 3, following Honda. After win, place and show, Consumer Reports ranks Infiniti, Acura, Mitsubishi, Lexus (the former No. 1) and Hyundai as the next most reliable vehicles.

Isn't it interesting that Scion is one of cheapest cars sold, yet it's the most reliable? As the headline of the Consumer Reports article states, "High price does not equal quality." You don't always get what you pay for when it comes to cars.

Who's stinking it up on the other end of the spectrum? One word: Chrysler. The second worst for reliability was Cadillac, followed by Dodge and then Jeep. What was Fiat thinking when taking on a share in Chrysler, Dodge and Jeep from the United States government?!

The full reliability list is available at ConsumerReports.org, where you can buy onetime access if you're not a subscriber. Or check it out for free at your local library.

Auto-buyers have lost all brand loyalty when they go to purchase a new vehicle, according to CNW Research.

Historically, it was almost a given that people would buy the brand they were already driving. Yet only one in five shoppers this past year replaced a vehicle with the same brand they previously had in their driveway. This is an unprecedented development.

Our loyalty to a particular nameplate has been broken. People want the best deal and the best vehicle for their money. This has been a disastrous development for auto marketers. The Detroit newspapers report that manufacturers are putting the blame on their ad agencies and firing them. But the real problem is that the market is too competitive and the quality of vehicles too good.

That's turned us into free agents with shifting allegiances. Our free agency puts continuing pressure on manufacturers to keep delivering quality vehicles at affordable prices.

But remember, you must be a non-emotional shopper and do your homework. Follow our step-by-step guide for tips. And be sure to consider multiple models from multiple brands to suss out the best deal.

Opportunity beckons in the car market. New data for September 2009 -- the most recent full reporting month -- shows that sales fell off a cliff in the aftermath of Cash for Clunkers.

Clark watches car prices continually and has noticed that they're starting to soften. During Clunkers, prices actually went up, but that trend has now reversed. The artificial stimulus of Clunkers is gone and now the marketplace has a collective hangover!

Dealers went from round-the-clock business to have nothing to do. Manufacturers put the factories back to work and now they've got to move that inventory. In addition, we're moving into a time of the calendar year when no one is interested in buying a new car.

As previously reported, the consumer champ had predicted that there would be a rough 60-day sweet spot in the market from just before Thanksgiving to just after the New Year. The new September stats now corroborate this.

The used car market is still disrupted from Clunkers. We're still short of inventory. After all, you can't just make used cars!

The result is that used cars will bring in more money at trade-in or if you sell it on your own, and your new car will be cheaper. All because of the market disruption of Cash for Clunkers.

Clark can't think of another time ever when he could say that new car prices are depressed at time that used car prices have firmed up. Of course, this will only be a temporary phenomenon.

Having said all that, should you be buying a car? That's the ultimate question. Just because something is a deal, it doesn't mean you should necessarily buy it. The true test comes when you honestly gauge your own financial situation and the reliability of your existing car. Getting new wheels simply because you want them is not a smart move unless you're in good financial shape.

CLARKONOMICS: The taxpayer bailout of GM and Chrysler has been a real bust. New figures from the Congressional Oversight Panel suggest that all $81 billion doled out by both former Pres. Bush and current Pres. Obama will be an almost complete loss.

Do we suddenly buy more cars because we have two more automakers? No. So how many jobs did it save to bail out two failed automakers? The answer is that it doesn't save any jobs.

How about the populist argument that "American jobs" were saved? Well, Toyota, Honda, Nissan, Mercedes and other foreign nameplates make their vehicles all over the United States. Meanwhile, GM makes cars in Korea for the U.S. market and Ford makes them in Mexico -- in addition to what each churns out at domestic plants.

It's a common refrain but Clark wants to sound it again: If you run your own business and you fail, do you get a bailout from Congress?

So why should the automakers?

Toyota has announced one of the largest recalls ever in the history of auto recalls, affecting 4 million Toyota and Lexus owners.

However, this is something of an odd recall because it involves a floor mat! Toyota's floor mats are suspected of contributing to the road death of a California family of four. The mat can jumble up near the gas pedal and cause the car to accelerate out of control.

According to Toyota, the following makes and model years are affected:

2007-10 Camry
2005-10 Avalon
2007-10 Tundra
2005-10 Tacoma
2004-09 Prius
2007-10 Lexus ES 350
2006-10 Lexus IS 250/350

The remedy here is quite simple. Take the floor mat out and just get your carpet dirty.

This recall has gotten a lot of publicity, but so many others go under the radar. For example, Clark had issues with a gas cap that would not open on one of his vehicles. So he went online to research the issue and found that this was a widespread problem. He printed out some supporting material and went to the dealer expecting pushback. But the dealer was happy to replace the cap for him once they pried it off!

Many times when there's no official recall, there still may be a technical service bulletin (TSB) from the manufacturer. AutoSafety.org will keep you abreast of TSBs and full-blown recalls alike.

The sad thing about recalls is that it's estimated only one out of three people will comply once notified.

RIP-OFF ALERT: Used car buyers can expect a glut of flood cars to hit the market in the wake of the flooding in the Southeastern United States. Clark wants to offer some tips so you can steer clear of these bum rides.

We're treading familiar ground here, actually. In the wake of Hurricane Katrina, we saw waves of flood cars coming out of Louisiana, Mississippi, Texas and other states.

Here's what to look for this time around:

• Be wary of any used car that shows up as recently titled in Georgia or Alabama when you research the VIN number through CarFax.com or a similar service.

• Use the National Insurance Crime Bureau's search tool at NICB.org to identify further identify flood cars.

• Make any used car purchase subject to inspection by an independent mechanic. You can leave a deposit if you wish, but specify in writing that the money must be returned to you if the car doesn't check out.

• And as always, know what fair market value is on the used vehicle in question!

Used compact cars represent the latest sweet spot in the auto market in a post-Cash for Clunkers world.

Americans have pivoted back to purchasing trucks and SUVs now that the price of gasoline is a shrug of the shoulders. GasPriceWatch.com lists the lowest price for gas in the United States at $2.11 in South Carolina. Of course, certain areas of the country like California are still paying near the $4 range. (Editor's note: Prices accurate as of Sept. 24, 2009.)

But overall, compare today's national average of $2.11 to a year ago at this time when prices were nearly twice as high across the country!

The softness in the prices at the pump have driven up sales of larger vehicles and depressed sales of smaller cars.

One exception to this general rule are some of the hybrid cars. Those that have been embraced by the public are holding their value for resale. Yet some models that have fallen out of favor, especially the SmartCar, have seen resale values drop, according to Kelley Blue Book.

The federal government has announced new rules for increased fuel economy. It's not Clark's first choice for getting the job done; that would be a sky-high gas tax to create a marketplace incentive for more efficient cars. Of course, no one seems to agree with him on that one! So that necessitates the government imposed fuel-efficiency requirements.

Over the next several years, vehicles will have to get an average of 34 miles per gallon (combined city/highway). Very few cars on our roads get this today.So how are we going to get there? Well, it won't be through the mass production of econoboxes -- even though Clark loves cheap, tiny rides!

Ultimately, auto makers will innovate with various new types of engines. At a recent European auto show, Renault-Nissan unveiled plans for no less than four different electric cars. Volkswagen will also have an electric car called the E-Up (pictured to the left) available in 2013. And the Ford Grand C-MAX will be available in the next 18 months with a small turbo-charged engine at the heart of a scaled-down minivan-like vehicle.

We've already got clean diesels in the market. We might even see diesel hybrids. And of course gas-electric hybrids will continue to grow in popularity.

All these efforts will reduce foreign oil dependency and that's great from a national security perspective -- even if it's not being done through Clark's favored gas tax approach.

There are times that we as individuals, institutions or companies mess up. After all, no one's perfect. The question is, how do you handle a mistake when you mess up?

Clark recently read a Wall Street Journal report about medical facilities that admit when they make an error. Traditionally, lawyers will tell you to deny, deny, deny any wrongdoing. But that's one of the prime problems in corporate America. People can't seem to say, "I messed up."

One corporation that did manage to own up to its mistake is Enterprise Rent-A-Car. The Kansas City Star reports that the nation's largest car rental agency found a unique way to save money as a fleet buyer. They deleted side airbags from Chrysler vehicles they were purchasing from GM!

It's important to realize that their decision was totally within the limits of the law. Typically, only front airbags are required by law.

The company saved nearly $12 million over three years with this cost-cutting measure. But here's where they went wrong: They didn't disclose that the side airbags were deleted when they resold the cars to consumers.

Enterprise has since contacted every single buyer and made full disclosure. They've also offered to buy the cars back -- regardless of condition -- at above market prices.

Kudos to the car rental giant on this one. They made a misstep and then took action to correct it.

Hyundai entered the U.S. market with the XL in 1986. But quality control issues early on got out of hand and the company made a bad first impression on car buyers.

At the time, Hyundai was by far the cheapest car in America with an MSRP of $4,995. But a car's got to be reliable too, right?

Poor Hyundai has now spent a full generation trying to overcome that initial impression. They never had the cachet of a Honda or a Toyota. But Toyota has endured massive losses and is closing a U.S. assembly plant for the first time ever.

Looks like Hyundai is having the last laugh now. Their 10-year warranty and unemployment coverage have really boosted the company's profile. Market share is up by a third in a year, according to The Washington Post.

Hyundai is a great example of where we're headed in this country. Many of their cars are made in the USA despite the foreign nameplate.

Meanwhile, on the affordability front, China is set to sell cars stateside beginning most likely in 2010. You can expect ultra-affordability, certainly below $10,000, but possibly as low as $7,995 in Clark's estimation! And Warren Buffett is investing in an electric car company in China that's also eyeing the U.S. market.

So whether you want a traditional gas engine or an electric car, more affordability is coming down the road.

People often wonder what the payback on fuel-efficient vehicles is like. A few years ago, it would have been hard to find a true payback. But that math has changed significantly. More often than not, a hybrid or diesel will save you -- even though you spend more upfront.

A new IntelliChoice report finds that the most economically efficient vehicle is a clean diesel -- the VW Jetta TDI. Over a 5-year cycle, it's more than $6,000 cheaper to own this than a gas engine -- even though the diesel costs $2,000 more upfront.

Other top vehicles include the GMC Sierra 1500 crew cab hybrid 2WD, the Prius and other vehicles like Chevy Silverado 1500 crew cab hybrid 2WD.

One that is an absolute bomb as a diesel and should be avoided is the Lexus LS 600 H. Over the first five years, you lose almost $25,000 vs. the gas engine version.

If Cash for Clunkers was designed to help U.S. automakers work off excess supply, it's been a grand slam success. However, it's been more of mixed bag for dealerships.

Many dealers got a huge increase in sales. But those that were thinly capitalized now find themselves hurting as they wait for reimbursements from the federal government. In fact, GM has had to extend interest-free loans to certain car dealers so they can stay in business.

Now the Cash for Clunkers program will end on Monday. It was originally supposed to last until around Thanksgiving. This is now the second time the program ran out of money. The original billion went in a week. An emergency allocation of $2 billion lasted a little longer and is now gone.

Where does the overall car market stand in the aftermath of Clunkers? Right now, the manufacturers have lean inventories and will likely overshoot on production as they ramp up to build new vehicles. Couple that with the continuing weak economy and Clark thinks the next sweet spot for new car buyers will come from Thanksgiving until Jan. 31, 2010.

Our nation used to sell 17 million new cars a year. Now it's more like 9.5-10.5 million annually.

One of the other effects of the Clunkers program has been that the value of used cars has gone up, especially in the $6,000 or lower category. We're experiencing a shortage of these so-called "beater" vehicles, which drives their price up. Yet as the used car market replenishes with more beaters, their price will soften too.

Clark has some humble pie to eat. He had been opposed to Cash for Clunkers, calling it a thinly veiled subsidy for American automakers. It is a subsidy, but the big surprise is what people bought with their Clunkers money.

The American people really rose above the program's weak mpg requirements and bought ultra fuel-efficient vehicles such as the Ford Focus and the Toyota Corolla. However, one downside to Cash for Clunkers has been that used car prices have gone up. Dealers have reduced available supply as they crush the Clunkers trade-ins.

Whether you're talking foreign or domestic, the quality of cars today is fantastic. Need proof? Look at the University of Michigan's quarterly American Customer Satisfaction Index (ACSI), which rated auto manufacturers, computers and appliances this time out.

In the car business, the highest customer satisfaction rating goes to Cadillac in a tie with Lexus (the historical winner). Following closely behind are Buick, Honda, Lincoln Mercury, BMW and others.

JD Power, Consumer Reports and the ACSI all have slightly different takes on the auto industry. But there's some consistency with Lexus, Cadillac, Buick doing well in survey after survey. So you can be comfortable buying American. And while some Chrysler nameplates get horrible scores, Ford and GM are doing a much better job with quality.

On a related note, GM is readying a $4,000 automobile for the Asian market. Clark believes that by 2012 we should have several options for new reliable vehicles under $10,000 stateside. Fiat is also planning to make an affordable car in Mexico for export to the United States and throughout Latin America.

So we have the perfect situation: Great quality and great affordability coming in vehicles.

Finally, a word on the ACSI results for the computer industry. Apple stands head and shoulders above Dell, Compaq, Hewlett-Packard and Acer. Why? Apple offers customer care after your purchase and it doesn't operate on Vista!

USfidelis is perhaps the most heavily marketed extended auto warranty in the country. Consumer Reports has investigated this popular outfit and is warning people away from them.

According to the publication, USfidelis has failed to respond to more than 1,000 complaints from the Better Business Bureau. Among the complaints are gripes about the difficulty of canceling the warranty; obtaining a refund; the nature of the company's misleading ads; their misrepresentation of coverage; and their failure to remove customer names from mailing lists.

In addition, Consumer Reports reveals that USfidelis told them customers are not allowed to see their contract until after they purchase it. What's up with that?

Of course, many of these problems are not necessarily specific to USfidelis. They also plague the smaller players in the extended auto warranty business. USfidelis just happens to be the top dog, so that's why they were singled out.

Let's take a moment and review. If you can afford the potential cost of a car repair, you should never buy an extended warranty. But if you're unable to budget and save for repairs, then you should only consider buying the manufacturer's own warranty. Do not buy any third party warranty.

And if you stick to Consumer Reports' annual recommended list of vehicles, you shouldn't have to buy an extended warranty at all -- even if you have budgeting difficulties. The odds are such that their recommended vehicles won't have severe problems over time.

Clark advocates thrift, but sometimes he'll hear about someone who goes way beyond him when it comes to making a dollar stretch.

A 90-year-old Florida woman named Rachel Veitch has driven the same car -- a Mercury Comet she calls "Chariot" -- since 1964. She bought it for $3,289 back when gas was 39 cents/gallon and it has outlasted 3 of her marriages. The odometer is now closing in on 600,000 miles!

"My Chariot has never lied to me or cheated on me and I can always depend on her," Veitch told FoxNews.com. "My last husband and I divorced in 1975 and he took the 1972 Pontiac we had and I kept Chariot. I'll bet he's traded cars half a dozen times by now and I still have my Chariot, my faithful pal."

Clark is not asking you to keep a car for 45 years. But you've to realize that a car is the second largest expense for most Americans after housing. And the biggest expense with an automobile is depreciation, especially if you like to cycle through new cars every 2 or 3 years.

If that sounds like you, Clark has a suggestion: Try buying a 3-year old car every 3 years. It will be new to you, and you'll let somebody else suffer the depreciation that accompanies a car's first couple of years on the road.

In a complete reversal from last summer, the average cost of a used SUV or truck has actually gone up. This while used vehicle sales overall are down some 30% year over year!

Tribune News Service reports used SUV prices are up 26% and used truck prices are up 27% year over year. Seems like the national gas average of $4.11/gallon that scared people away from larger vehicles one year ago is now just a distant memory.

As you might expect, smaller vehicles are now going unloved in the marketplace, as the price at the pump continues on its downward slope. In one very telling illustration of what's going on right now, Toyota abandoned construction of a Prius plant in Mississippi in mid-project!

Now is the time to zig when others zag, if you can afford it. Some small new cars are selling for under $10,000! And used vehicles that are smaller continue to be a real deal.

Hyundai is on a roll. Just recently, Clark told you how the Korean automaker was praised by JD Power. Now the August issue of Consumer Reports says the Hyundai Elantra is one of the best and most affordable small wagons/hatchbacks.

Earlier this year, Hyundai started offering buyer's assurance as an incentive. Now their marketing wizs are on to gas. If you buy a new car, they will fill up you at $1.49/gallon for 12 months.

Mind you, the cost of gas is likely headed down, barring unexpected world events or weather patterns…but Clark doesn't think it's going down to $1.49! So Hyundai's offer is very generous.

Meanwhile, Consumer Reports trashes the new hybrid Honda Insight. The vehicle received an overall score of 54, which is the second lowest for any small vehicle. This is perhaps the first time ever that a Honda has gotten a low F from Consumer Reports.

Yet the lowest score of all goes to the Dodge Caliber with a 49.

On the other end of the spectrum, the No. 1 hatchback/station wagon is the Mazda 5, which earned a score of 86. That's right up there with some very expensive luxury vehicles. The Mazda 5 has a street price of around $17,000 with power gizmos included.

But what a stunner for the Insight, which Honda was marketing as an affordable hybrid at around $18,500. The people at Honda must be licking their wounds after having put so much research and resources into the Insight.

Other top picks from Consumer Reports in the small car category include the Volkswagen Rabbit, the Volkswagen Jetta-SE and the 2009 Toyota Prius.

JD Power's 2009 Initial Quality Study has named a trio of costly vehicles as its most-reliable cars, according to The New York Times.

Those pricey nameplates include Lexus, Porsche and Cadillac. In fact, Lexus got the highest scores across all measurements of the survey.

Are you looking for a cheaper ride that's still dependable? Hyundai and Honda both tied in second place in the study. The former was a onetime laughing stock of the industry and the butt of late-night TV jokes. The latter, meanwhile, has always been one of the "old reliables" in the auto world.

Clark's gone to the same Honda mechanic since 1987. The poor fellow only gets to do maintenance work because the brand is so dependable!

So who is stinking it up in the eyes of JD Power? 12 brands get the lowest score. The lowest of all was a tie between the MINI Cooper and the Landrover. Yet MINIs still sell like nobody's business!

Saab, SmartCar, Jeep, Chrysler, Hummer, Mitsubishi, Dodge, Jaguar, Subaru and Lincoln are the other brands that also got low marks.

Remember, when you get past the new car smell, the most important thing is that a vehicle be reliable and dependable.

The Cash for Clunkers program has already spawned its fair share of potential rip-offs online.

Unofficial websites are masquerading as the official Cash for Clunkers portal, according to an Associated Press report. These bogus sites will solicit personal information such as your Social Security number for supposed pre-registration…and then turn around and use it to steal your identity or money.

For those of you who may be unfamiliar, Cash for Clunkers is a new federal program offering rebates of up to $4,500 for trade-ins when you purchase a newer fuel-efficient vehicle.

The "cash for clunkers" program is taking form and promises rebates of $3,500 or $4,500 for trade-ins when you purchase a newer fuel-efficient vehicle.

The effective date for the program -- officially known as the Car Allowance Rebate System (CARS) -- has not yet been set. But Clark expects it to be sometime toward the end of July or the beginning of August. There should be a 2-month buying opportunity through October.

Let's say you start from a baseline of 18 mpg on your current vehicle. If the new car you intend to buy gets 22 mpg or more, then you'd get the $3,500 voucher toward the purchase.

Please note that participating dealers will apply this taxpayer-subsidized credit directly to your purchase.

You're only eligible for the full $4,500 voucher if your next purchase gives you at least 10 mpg more than your old vehicle.

Meanwhile, there's a lower threshold for SUVs and trucks. You'll get the $3,500 voucher if your new vehicle get 2 mpg or higher. If it gets 5 mpg or more, you then get the $4,500 voucher.

The vehicle you're trading in has to be drivable and the dealer has to agree to crush it. There are also several rules to prevent abuse of the program. For example, the car you're dumping has to have been registered and insured continuously for at least 12 months prior.

Other countries that have experience with similar programs saw an immediate big increase in sales as a direct result of the program. That's the hope for the American auto market too.

Remember, of course, that there are still some great deals on vehicles available regardless of the "cash for clunkers" program. The more shopping you do, the better the price you will get. See Clark's tips for buying a new car.

The deals on new cars are undeniably amazing because of vast oversupply. But has Clark's recent overwhelming enthusiasm about buying new left you exasperated with the consumer champ?

It's as if "Used Car Guy" is betraying his roots. Whatever happened to his advice to ride your old car until the wheels fall off?

Well, here's a rebuttal that may please you. AAA reports that the true annual expense of owning and operating a car is $7,800, according to an article in The Wall Street Journal. This figure takes into account insurance, gas, maintenance, interest, depreciation and other factors.

The real cost of buying a new vehicle comes when you take a huge hit on depreciation during the first few years of ownership. But that loss in value decreases each year until you're eventually practically driving for free.

So the math remains lousy if you buy a car and keep it for a short cycle. And it's even worse if you lease a car.

Are you one of the few Americans in the market for a car? There are more of you out there than you think.

CNW Research says 4 million used cars were purchased in the United States during the month of May. That's astounding when you consider that the market for new cars is only 9 million in the United States over the course of an entire 12 months!

Clark can't believe the advice he's about to give…but it's now possible to get a better deal on a brand new car than on a relatively new used car.

It's a classic case of supply and demand. The used car market is up about 25% and new car sales are down 34%, according to figures from The Boston Globe.

This is, however, a temporary phenomenon. Do not take this as gospel for the future! In most instances, a used car will almost always be a better buy. Just not right now!

Meanwhile, if you want to buy a new vehicle, Clark has new way to make the purchase easy. In the past, he's talked about CarsDirect.com and the wholesale clubs' buying programs.

But there's a new kid on the block known as Zag.com. This service gives buyers instant guaranteed up-front prices from a network of certified dealers. It also offers an easy delivery process that helps you avoid "the grind" at a dealership.

Zag is available to members and customers of Overstock.com, Capital One, UPromise and USAA at the moment.

So will Zag get you the lowest possible price? Well, it's a very good price, but a dedicated hard-working shopper can probably find a slightly better deal on his or her own.

Saturn's promise of being "a different kind of company, a different kind of car" has gotten a new lease on life thanks to entrepreneur Roger Penske's plans to buy the nameplate from an ailing GM.

Penske plans to revamp Saturn by sourcing his materials from anywhere in the world where the price is right. That will allow Penske to bring new products to market much quicker. It will also free him up to concentrate on the design of vehicles instead of the intricacies of running factories and dealing with parts suppliers.

This kind of sourcing is very similar to what happens with your laptop. The brand name that's on the laptop has nothing to do with where it is sourced. Final assembly may not even be overseen by the "manufacturer" in most cases. Such a business model allows the parent company to spend real effort on design and quality control.

Capitalism ultimately thrives on people who create and who see vision that others don't. We see it in the Ted Turners, Fred Smiths and Starbucks locations of the world.

People laughed at Turner when he launched CNN with its 24-hour approach to news in 1980. Likewise, Fred Smith of FedEx had to create a market for overnight package delivery where it didn't exist. And who would have thought you'd need to spend $5 on a cup of coffee at Starbucks?

In each and every one of us, there's an idea for a way to do something better or to bring a new product or service to the world. Will you tap into yours?

Remember the Yugo? This much-maligned vehicle made in the former Yugoslavia was just about the worst car ever made in the history of the automotive industry. In fact, Consumer Reports once said a consumer would be "better off buying a good used car than a new Yugo."

The quest for a good cheap automobile goes on. Recently, India rolled out a 4-door, 5-seater called the Nano that sells for around $2,000. Orders for the Nano exceeded 200,000 in just 2 weeks and the customer waiting list had to be shutdown.

The Nano would sell for around $5,000 if it were to come stateside. That accounts for the expense of retro-fitting the Nano for our emissions and safety standards. Even so, that would still be almost half the cost of the current cheapest car in America -- a stripped-down Nissan Versa at $9,300.

The inspiration for the Nano was the Logan by Renault. This particular 4-door sedan is available in Europe fully equipped for $6,000-8,000. It was originally marketed in Eastern Europe, but has found vast popularity among Western Europeans.

It's clear there's a large untapped market for a reliable basic new car in the United States. Many Americans live on an annual salary of $30,000-$40,000. They simply can't afford to buy a new car.

Clark wants to go on record with his prediction that we will have a mainstream affordable vehicle retailing at $7,995 (or less) by 2012. Only time will tell if he's right.

The collapse of General Motors -- the largest failure of a capitalist enterprise ever -- almost defies description. Their debt stands at $172.81 billion, while their (very questionable) assets are at $82 billion.

Here in America, we used to have something called capitalism. If a business got in trouble, it could either fail or reorganize in bankruptcy with DIP (debtor in possession) financing.

If a business could get DIP money, it then shed its assets and renegotiated its business arrangements. Next, it looked for exit financing, where a lender who believed in the company would lend money so the company could exit bankruptcy.

Of course, as a practical matter, most businesses never saw the light of day ever again once they entered bankruptcy.

But in the case of GM, former President Bush gave them $13.5 billion in federal money during his last days in office. He also bailed out the company's lending arm GMAC. Then current President Obama gave them additional money, which took them up to the $20 billion mark, and also axed GM's CEO.

Now the government is looking at a minimum of another $30 billion going into GM.

So what happens from here? The government has already decided to guarantee GM warranties. That's the least they had to do in order to instill buyer confidence.

4 out of 10 dealers will close in the wake of the failure. The remaining ones will make tons of money. However, servicing at remaining dealerships may be more difficult in the interim as the survivors are flooded with business.

There's no denying that the deals on dead GM brands like Saab, Hummer, Pontiac and Saturn will be great. But if you buy, be sure you keep the vehicle for 10 years or longer; the resale value on orphan brands is very low.

Ultimately, GM will emerge from bankruptcy; they're going to shed nearly $80 billion of debt. But then over time, the marketplace will have to decide if their products are good enough to buy again.

And for those who are wondering if now is the time to buy GM stock, Clark answers with a resounding no! We already own about 60% as taxpayers.

It appears certain that General Motors is going bankrupt. The government was hoping to keep GM afloat with a private workout, but they're running out of time and it's unlikely that will happen now. Since we've already sent them over 30 billion in bailout money, the question remains as to who will assume control of the bankrupt company -- the government or the debt-holders. Either way, stock holders and bond holders will lose.

What if you own a GM or Chrysler car? The good news is the feds have agreed to back the existing warrantees for both, as well as the dealers' extended-service contracts. The bad news: some of you who traded in a car that still had an outstanding loan may face a problem. Dealers who are going bankrupt are not always paying off the loan on your old car as agreed. Unfortunately, that leaves you responsible to pay off both loans, even though you traded it in.

Another problem with these dealer closings is loss of your service records. Warrantee agreements rely on these records to determine whether owners are doing the required recommended maintenance. Without them, claims can't be processed.

What does this mean for you? In this market, Clark advises you to not to trade in a car that still has a loan. Also: if you don't have all your service records -- and your dealer is still in business -- go to the dealership, request copies of all your records and file those away. On the plus side, if you're a buyer, inventory overstock will allow you to steal a deal! But you'll need to buy with the intent of keeping the car a long time -- ten years or so -- since your car will have little to no value in the used-car market.

New rules about credit cards passed today in the Senate by a vote of 90-to-5. No longer will this industry be able to completely control your life if you can't pay your balance in full!

Lenders are expected to be required to give 45 days notice before any changes in their terms and conditions. In addition, you'll now have to be late for more than 60 days before they put you into a penalty rate. And they won't be allowed to raise rates on existing balances that you're currently paying.

There are so many positives here. Of course, the Senate bill still has to be reconciled with the House bill and made into a law that President Obama is expected to sign within a week or so.

One provision that Clark hopes survives would be to allow retailers to offer a discount for paying in cash vs. paying with a credit card.

Right now, there's no financial benefit for consumers who want to pay cash upfront -- even though it's cheaper for retailers because they don't have to pay credit-processing fees. So the consumer champ's fingers are crossed on this one! We spent too long encouraging people to spend themselves into oblivion and this would be a refreshing change.

Meanwhile, President Obama today announced new standards for vehicle emissions. In essence, he's adopted California's standards, which has been regulating emissions for years before the feds ever decided to do so.

The new fuel standards call for the average vehicle to get 35 mpg by 2016. Right now, only 7 cars meet that standard…and they're mostly hybrids. The sole gas engine vehicle that makes the cut is the Smartcar, according to The Washington Post.

Will we be able to meet the 2016 deadline? Clark likens Obama's announcement to what JFK did when he told a dispirited nation that we'd be the first to put a man on the moon.

Finally, the penny-pincher believes the new fuel standards represent smart federal policy from a national defense angle. He's in support of anything we can do to reduce our dependence on foreign oil. Why be held over a barrel by nations that want to harm us?

New data from Comerica Bank's Auto Affordability Index shows that new cars are now the most affordable they've been since records started being kept in 1979.

In fact, the average new car is now $1,700 cheaper than it was during the last quarter of 2008. That's a massive price reduction. And we've got more price cuts coming because of oversupply.

Speaking of oversupply, The Detroit News reports that Chrysler has rolled out new incentives that give an additional $6,000 back on a number of its vehicles. But remember, if you buy a Chrysler, you must keep it for a minimum of 10 years because resale value is greatly in doubt.

So if you are in a financially secure position, it makes sense to be in the car market right now.

Meanwhile, a hybrid is now the No. 1 selling car in Japan for the first time. This is the first year that hybrids are cost competitive with traditional gas engine cars. That's thanks in large part to the new Honda Insight, which has an MSRP of $19,000 fully equipped.

But U.S. auto dealers are running it up in price, so give it a few weeks before you try purchasing.

Finally, have you gotten a robocall about an extended car warranty? The Detroit News reports there are some 35 firms in the St. Louis area behind these automated calls.

Extended car warranties are problematic to begin with, but you'd never, ever want to consider one that's not directly from the car manufacturer itself. Period.

Washington, D.C. is set to take a cue from Europe in adopting its own version of a "cash for guzzlers" program.

The central idea is to allow people to take an old, nearly worthless car and receive a cash bounty of up to $4,500 toward buying a new fuel-efficient vehicle.

Under the proposed system, the full amount of the voucher would phase in based on the miles per gallon your next car purchase gets.

Say you start from a baseline of 18 mpg on your current vehicle and get a new car that gets 22 mpg. Then you'd get a $3,500 voucher. You're only eligible for the full $4,500 voucher if your next purchase gives you at least 10 mpg more than your old vehicle.

There will be a separate program for SUVs (you'll need a 5 mpg increase to qualify); one for light-duty trucks (2 mpg increase); and one for work trucks. The latter is a real reversal in policy; small business was previously given tax subsidies to buy the most fuel-inefficient trucks it could!

Talking about legislation that's in progress is always dangerous. But there's a lot of momentum for this and a general consensus on the broad outline that seems to be agreeable to most politicians in D.C.

With the news of Chrysler's bankruptcy, Clark is already getting people wondering if now is the time to steal a deal on one of their cars.

The short answer is no.

First, Consumer Reports says that Chrysler's passenger cars are not reliable. The consumer champ concurs with those findings based on his own experience as a frequent car renter.

Second, even if you think Clark is being unnecessarily hard on the failed automaker and still want a Chrysler, it's not time to buy quite yet.

There will be opportunity to buy at good prices once Chrysler renounces ties with many of its dealerships as part of a restructuring effort. That's when you can swoop in and pick up the wounded ducks. Clark expects that to be later this year, probably in the summer.

And if you still think he's being unfair to Chrysler, the penny-pincher encourages you to rent one and see if you don't agree with the assessment from Consumer Reports!

In related auto industry news, Ford outsold Toyota in April for the first time in a year. Sounds like Toyota believed all the hype about how great they were and started overproducing vehicles, building too many factories and crafting gas guzzlers at the worst possible time.

The car market can change on a dime!

CLARKONOMICS: Are you ready to own what used to be the largest company in the world? That's the situation American taxpayers find themselves in as they prepare to take a 55 or 60 percent ownership stake in General Motors as part of the auto industry bailout.

Meanwhile, the federal government is close to a final deal on Chrysler that will allow for their likely takeover by Fiat.

Clark doesn't understand how the General Motors scenario could be good for the country. What message does it send about success and failure? That if you're big enough, the government will step in to ensure that you survive no matter what?!

Remember, in capitalism, we have a procedure if you fail in the marketplace. It's called bankruptcy.

As a practical matter, Clark's been fielding questions about the viability of buying "orphaned" GM brands such as Pontiac, Hummer and Saturn.

Buying a Pontiac is not a good idea, according to the consumer champ. Orphan sub-brands lose their resale value in the marketplace once their parent folds. Only consider buying one if you intend to run the car into the ground and keep it for a minimum of 10 years.

With all the talk about GM and Chrysler being on the ropes, there's another story that's not being told. The Asian automakers are ailing too. Toyota is down just as much as Chrysler, while Honda is down just a little less.

Here's the dilemma for the Asian automakers: They make a car in a foreign factory and then have to ship it to the United States. But while in transit, the domestic auto market just keeps bottoming out.

So now there are literally thousands of Asian nameplates that they're running out of room to park at the sea ports where they enter the country!

In one example, The Washington Post reported that Toyota had to rent a cargo ship to park 2,500 cars that they didn't have room for otherwise.

Cars are piled up at the docks, the rail yards and the dealer lots…and nobody wants them.

This means that in the next couple of months, you'll see deals on Asian cars that are unlike anything you've seen before. We're already hearing anecdotally about people buying new cars cheaper than they could a 1-year-old vehicle. Normally, that would be unheard of!

Just remember that this is a temporary window of opportunity because the Asian automakers had too many cars in production. Eventually that oversupply will be bought up. So you have to strike while the iron is hot.

Of course, Clark doesn't even want you to think about buying a new car -- no matter how cheap it is -- unless it's truly in your budget.

New fuel economy standards are coming for all 2011 vehicles. The average passenger car will have to get 30 miles per gallon and the average truck 24 miles per gallon.

Yet while that is happening, smaller fuel-efficient cars and hybrids are piling up unloved on dealer lots. Many people are making a lifestyle choice to buy big trucks again now that gas is no longer $4/gallon.

Oh, we have such short memories!

Meanwhile, the new version of the Segway that's coming out is a total "Clarkmobile" if there ever was one! This two-wheeled two-seater, being produced in conjunction with GM, is slated to hit the roads in 2012.

So Clark is now considering ditching his scooter and getting a new Segway instead. At least, that's what his wife wants him to do! The original Segway, introduced about 8 years ago, was supposed to change our lives, but only found very limited market appeal.

The whole discussion really reminds Clark of his three-wheeled Freeway, which got 100 miles per gallon and seated three people. Now that was a car!

Subprime borrowers may now be able to get a car loan through GMAC thanks to federal bailout money, according to The Detroit News.

Clark says it's like going back to the future with the lowered lending standards that got us in trouble in the first place across so many credit markets.

Applicants with credit scores of less than 620 will now be considered. Of course, if you have terrible problems with credit, it's probably not a good idea to take on a long auto loan.

It's clear this is happening right now because car sales were absolutely decimated last month. GM sales were down 45%; Chrysler was down 39%; Toyota was down 39%; and Honda was down 36%. The auto market overall was down an average of 37%.

So the nearly $6 billion made available by the government is being used to make loans to people who may not be able to pay them back -- all in an effort to try to move cars that aren't selling off dealer lots.

Clark thinks this is a bad idea. The answer to the lack of demand for these cars is not to go to the subprime market. Yet at the same time, he felt compelled to get the word out about this new influx of money if you're looking for a car loan.

It's now been almost one year ago to the day that Clark made some comments about Chrysler that provoked heated response.

In short, the consumer champ questioned the company's viability (while expecting them to go bankrupt) and predicted that their warranties would be worthless back in April 2008.

This is one of those cases when Clark wishes he had egg on his face…but Chrysler is a basket case and so is GM. Now we have an unpleasant journey ahead of us that is a perversion of capitalism.

Consider this: The federal government is now in charge of Chrysler, and they fired the CEO of GM! In addition, the government has gone into the extended auto warranty business!! The president of the United States is now guaranteeing new GM and Chrysler cars and their warranties. Wow.

Recently, Clark has been asked how he can support the Wall Street bailout and be opposed to a bailout for the auto industry. Sounds like a split personality, no?

As he's said before, the very fabric of capitalism itself requires a functioning capital sector. But it's a whole different game when you're being asked to take care of an industrial organization that didn't manage itself well.

Capitalism allows you to file for bankruptcy, reorganize in Chapter 11 and try to make a go of it again. That's how the system should work.

But if you can't reorganize, you go bust.

If GM and Chrysler were allowed to meet their natural end and become extinct, it would not threaten the continued availability of cars in the United States. We are buying 9 million cars a year. Yet we have factories that can make 18 million vehicles annually. You do the math.

Nissan has identified a market for ultra-affordable new cars and come out with a sub-$9,000 version of its Versa that is entirely no frills.

The 2009 Nissan Versa 1.6 Base has a smaller engine than the standard version; no power windows; no radio; no anything in the way of modern accoutrements! But it will seat 4 people comfortably and even 5 uncomfortably.

In a similar realm, Hyundai and its discount brand Kia recently rolled out fully equipped discount cars starting at $11,000.

But the real king of ultra-cheap transportation at the moment is an Indian vehicle called the Nano. This four-door car -- available only in the Indian market -- sells for around $2,100 in U.S. dollars. Clark believes it's a template of what could become a new standard for ultra-cheap transportation around the world.

Estimates suggest if the Nano were to make it stateside, it would probably sell for around $5,000. That includes factoring in the cost of making the required safety and emissions tweaks required by our government.

In another example, the Logan by Renault is a fully equipped 4-door sedan that was originally sold in Eastern Europe for $6,000-8,000. But Western Europeans have really embraced this vehicle and brought it over to their countries. That's proof positive that economies similar to ours are looking for cheapo cars.

The typical wisdom about cars is that it's smarter to buy a used car than a new car. But if the industry can deliver reliable transportation for a 4-digit price tag with an original manufacturer's warranty, then there would be less reason not to buy new.

Several months ago, Hyundai announced their version of layoff coverage for new car purchasers. If you buy a new vehicle and lose your job during the first year of ownership, you can turn the car back in -- no harm, no foul.

Hyundai is trying to ease people's fears about jobs and the economy. And you know what? It's working. Their market share has increased on the strength of their promise.

Car sales are half of what they used to be now that people are keeping their cars on the road longer. So it's no surprise that car dealerships are hurting…and that at least one dealership is taking a page out of Hyundai's play book.

AutoNation will cover 6 months of car payments on new or used vehicles if you become unemployed. This program is rolling out first in Florida where consumers have been hit extra hard by the real estate bubble.

But is this enough of a reason to buy a car? No way, says Clark. If you're at risk of a drop in income, you've got bigger fish to fry than just what's going on with a potential car purchase.

During last year's hysteria about gas prices, Clark said it was a bad idea to buy a hybrid. Even at $4.11/gallon, the payback on hybrids simply did not make sense. In addition, dealers were doing what the marketplace allowed at the time and charging far above sticker price.

Now that the price of gas is back down, sales of hybrids have fallen by two-thirds. The Chicago Tribune found that the average supply of Priuses was at 2 days last year. Now it's sitting at 80 days! Keep in mind that a 55-day supply of vehicles on dealer lots is typically where supply and demand are at equilibrium.

The Chicago Tribune is also reporting some people have bought Priuses for $5,000 below MSRP, even though dealers are still pricing them high.

In another example of the declining demand, Chevy Malibu has a hybrid version that's priced above the gas engine model. But they sell less than 100 per month!

Meanwhile, Honda's new Insight hybrid is the first hybrid to be priced in the teens with a $19,800 list price.

The real opportunity, however, is not buying a hybrid new; it's buying one used. A lot of people who got caught up in the hybrid craze last year have discovered they don't exactly love driving around in a "putt-putt mobile."

So now may be the time to strike. Gas won't always be this cheap…

After endless delays, the long-awaited $2,000 car is finally set to make its debut in India. The Tata Nano (pictured to the left) is actually a product of the company that owns Jaguar. Talk about two opposite extremes in pricing!

Several years ago, Clark told you about a vehicle called the Logan by Renault. This 4-door sedan is available in Europe fully equipped for $6,000-8,000.

These affordable car makers use slightly older -- albeit proven -- technologies to make vehicles that are reliable but not necessarily cutting edge. Unfortunately, this affordable car movement hasn't hit the United States yet.

Estimates suggest if the Nano were to make it stateside, it would probably sell for around $5,000. That includes factoring in the cost of making the required safety and emissions tweaks required by our government.

There is a huge market for affordable transportation here stateside. So why can't the American automakers figure out how to do something similar??

If you're an owner of a Hummer, Saturn, Pontiac or Saab, you may be worried about news that GM is considering phasing out these four brands.

Rest assured that your warranty on any of these cars will be honored as long as GM is in business.

The big concern, however, is resale value. Clark recalls when Oldsmobile folded and became an orphan brand. The value of axed vehicles tends to drops significantly.

On the other hand, there is something to be said about the antiquity factor of a car that's no longer in production. Well-preserved models may be worth a pretty penny decades down the road even though they're unloved today. For example, Clark speculates the PT Cruiser (not a GM model) may experience this simply because it has such an unusual and uncommon design.

If you are leasing a Hummer, Saturn, Pontiac or Saab, don't be tempted to buy the car at the end of the lease. You'd be best off just turning it in.

One final thought: For potential used car buyers, there will likely be some sweet deals on these GM brands if the axe does eventually fall on them.

Major restructuring is coming for GM and Chrysler as both automakers continue to ask the government for more money to survive. In this case, "restructuring" is a euphemism for saying that we the taxpayers will foot the bill for their bailouts. The final total cost is unknown, but rest assured that we will be "partners" with them in an effort to save auto production in America.

Clark was opposed to the initial round of auto bailouts, and he's also opposed to the latest GM and Chrysler request for bailout money.

The whole question of what qualifies as a domestic automaker is misleading; Both GM and Chrysler import some cars built abroad and slap their nameplates on them. Likewise, foreign automakers have domestic assembly plants and employ American workers. Nissan makes cars in Tennessee; Mercedes makes them in Alabama; BMW in South Carolina; and Honda in Ohio, to name just a few examples.

In capitalism, the most efficient provider should survive, but these government subsidizes actually allow the inefficient to survive. That's exactly why a bailout subverts the intent of capitalism.

It may seem like we're helping to save American institutions. But what kind of example does it set for the rest of the world, when other countries are considering their own bailouts? The French are bailing out just about every industry known to man. Before you know it, they'll be bailing out pastry chefs!

And then there's the "what about me" syndrome. Clark is always hearing from small business owners asking, "Where's my bailout?" That's the hazard you create in capitalism when you pick winners and losers based on the strength of their lobby in Washington, as we're doing with the automakers. It creates a kind of "bailout envy" with a severe ripple effect.

Vehicles now present the best affordability, best quality and highest level of safety ever since Henry Ford first rolled out the Model T.

The global oversupply of manufacturing capacity in the automotive sector is mind-blowing. The manufacturers built far too many factories in far too many countries around the world. That creates a lot of opportunity for anyone looking to buy new.

One particularly sweet spot in the market is the four-door sedan. Clark knows this isn't the "sexy" choice, but it is a Clark Smart one. You can buy a fully equipped sedan for under $20,000. Keep in mind that sedans will typically deliver 30% to 50% better fuel economy than a comparable crossover SUV.

A recent check of Consumer Reports' online database suggests a number of choices that offer both great value and a high safety rating. These include Chevy Malibu, Ford Fusion, Honda Accord and Hyundai Sonata to name just a few.

Looking for a little-known sweet spot in the car market? Clark has 2 suggestions to share.

First, try getting vehicle upgrades you want done aftermarket rather than paying the manufacturer. For example, Clark recently had DVD headrests installed in his Mazda 5 micro-van for $500. The same installation job could have been thousands of dollars had he gone through his vehicle manufacturer.

Second, manufacturers will have several models of what's essentially the same vehicle for sale at a variety of price points. So if you're in the market for a new vehicle, you want to buy the base model or no more than one model level up for the best value.

CLARKONOMICS: One common measure of an automaker's overall health is the days' worth of supply they like to have on their dealers' lots.

U.S. automakers traditionally aim for 60 days' supply on a lot. That means that if they closed every factory, it would take 60 days to sell off the existing vehicles. Japanese automakers, however, like 40-45 days of supply on their lots. Anything less than that and customers likely will be disappointed when they go to a dealership looking for a certain color, certain features, etc.

But right now Honda has 100 days of oversupply on its dealer lots. So it would take 3.5 months to work off the inventory if they stopped all production today. That massive oversupply means right now you can steal a deal on any of their models -- even the very popular Accord and Civic.

Honda isn't the only automaker with tremendous oversupply. The king of oversupply at the moment is Chrysler. They are sitting on 142 days' worth of supply on dealer lots. That's almost 5 months of unsold inventory!

Back in April 2008, Clark wondered about Chrysler's future and got an earful from the automaker. Today, it's no secret that they're on shaky ground. Chrysler's situation is so dire that they're only still open because of the bailout.

So know this: You buy a Chrysler product at your own risk. Should the company fail, the warranties will vanish and the resale value of their vehicles will diminish.

The December sales figures for the auto industry were abysmal as expected. Chrysler is down 53% and GM is down 31%. Foreign nameplates like Toyota and Honda are down 37% and 35%, respectively.

To compound the sales declines, Americans are now getting more life out their vehicles. The median age of cars on the road now is 9 years. Go back one generation and it was only 5 or 6 years. Vehicles are made so much better now than they used to be. You can buy a car, drive it over the course of many years and do only scheduled maintenance without having any major repairs.

For example, Clark's wife has had a minivan for 5 or 6 years that only has 70,000 miles. The only non-scheduled maintenance she's needed has been to replace a front headlight that burned out. That's it. Similarly, Christa bought a used Lexus RX 300 SUV with 100,000 miles on it several years ago. It drove like a brand-new vehicle with no trouble and not a single repair while she owned it.

So the brutal sales figures and the trend of keeping cars longer mean one thing for you -- opportunity if you're in the market for wheels. Hyundai is doing a deal where if you buy a new vehicle and lose your job in the first year of ownership, you can turn the car back in -- no harm, no foul. They're trying to ease people's fears about jobs and the economy.

Automakers today can make 7 or 8 million more cars than there's demand for in a given year. So look for great deals in 2009 -- whether you're buying new or buying used. Just be sure to get your potential purchase checked out by an independent mechanic if you're buying used.

There are some amazing opportunities right now in the car market. New stats show that luxury car sales are down 32% in the most recent monthly reporting period. Similar troubles have hit the market for regular cars too. This is, after all, an equal opportunity recession for people of all income levels.

Luxury cars makers are really getting it from all sides. Their products have fallen out of favor because they feel too ostentatious in our new no-frills era. In addition, much of the high-end market depends on corporate clients buying their cars as perks for employees. But employers have dialed back on making those purchases too.

What does it all mean? This could be a perfect storm of opportunity that you can sail through and benefit from should you want a fancy car.

If you're looking for hard numbers, J.D. Power estimates that Mercedes' sales will fall more than 40%. BMW is expected to slip 20%. The sales of Bentleys -- which still costs $250,000 -- are down 66%, while Porsche is down 50%.

The real deals, of course, can be had on used luxury cars. Just remember to get a potential purchase carefully vetted by a mechanic before you take the plunge.

Finally, when it comes to regular cars, Edmunds says the discounts off MSRP are 25% to 30% these days. In fact, it's even possible to find new economy cars for just under $10,000.

The automakers are in the midst of their begathon appeal to Congress and the president. While political talk show hosts have been all over this story, Clark wants to discuss it from an economic perspective.

GM sales are down some 40%, Chrysler is down some 50% and Ford is down around 30%. The American people have spoken -- day after day, purchase after purchase -- and said they don't want the products the Big 3 are making.

This is not, however, a diatribe about the American worker. It's really general management that has failed. Case in point: There was a GM plant in Fremont, California, that was just about the worst plant since the days of the Yugo. Toyota took the plant over; hired back the exact same workers who were employed there under GM; and it went from worst to first within 2 years. Again, there's nothing wrong with the American worker; it's management that's at fault.

Now we have the Big 3 coming to us and begging to get them out of their management failures. GM says it could fail in a matter of weeks. They're trying to create a sudden sense of urgency.

Capitalism allows you to file for bankruptcy, reorganize in Chapter 11 and try to make a go of it again. That's how the system should work. It should not entail us being told to empty our wallets because the Big 3 didn't make cars that we wanted to buy.

In capitalism, if a business is allowed to fail, the marketplace allows other more efficient businesses to survive. We pervert the system by bailing out manufacturers who have inefficiencies. Of course, the Big 3 will cloak themselves in the American flag during their begathon, but what they're really looking to do is put capitalism in a straightjacket.

Ford is offering employee pricing to all customers because they can't get people to buy their SUVs and trucks. People often wonder if employee pricing is real. It is the real deal. The idea behind it is to reduce existing inventory before the new models come in.

The employee pricing is good on almost all Ford, Lincoln and Mercury 2008 and 2009 models -- from now until the first week of 2009. The only vehicle not covered is the Ford F-150 truck, which was once the most popular vehicle in America.

In related news, the auto bailout has a flat tire at the moment. That's good news for our country -- when you view it from a vantage point of sound economic principle. In short, it's a lousy idea to bailout industrial corporations.

There will be another big push for the automaker bailout when Obama comes in, but Clark hopes it doesn't happen. Not because he wants people to suffer and lose jobs, but because our country suffers when you bailout a company that made too many bad decisions.

Want proof of that statement? Read the New York Times' piece about the outcome of England's $16.5 billion of automaker British Leyland back in the '80s. Leyland ended up failing anyway and all that taxpayer money went down the toilet.

Meanwhile, other industries are lining up at the bailout teller window looking for a handout. We have to do more than just draw a line in the sand -- we have to stand up as a country and say "no more."

Think Clark is a hypocrite for opposing an automaker bailout, yet begrudgingly supporting one for Wall Street? You've got to realize that, as we see in the latter example, capitalism needs capital to function. But that's a far cry from bailing out a private industry.

Just days ago, Clark shared a recap of his anger over Circuit City's 2007 decision to fire all their knowledgeable employees and managers in an effort to cut the company's bottom line.

The fruit of that decision has now been revealed: Circuit City has filed for bankruptcy. "The intelligent choice" was once the company's slogan. The intelligent choice? Get real, people.

Circuit City gift cards are still being honored -- for now. But as The Wall Street Journal points out, now is great time to use any Circuit City gift cards and take advantage of their special closing-out sales. Remember, a gift card is just a promise to honor your legal tender at a later date. But that's a bad bet now with retailers and restaurateurs failing.

Now let's turn to GM. Analysts have found that GM stock has sunk to the lowest level since WWII. Oh, how the mighty have fallen. GM's market value is back to where it was when we had just defeated the Nazis. The company's CEO now says they will need a bailout from the lame-duck Congress. They can't even survive until Obama gets in office.

As you may know, Clark is totally opposed to any bailout of the automakers. He believes it's bad for the country and bad for our image around the world. In capitalism, you're supposed to go bust if you can't make it. And if we bail the Big 3, where does it all end? Should the owner of the corner hardware store go to Washington looking for help because the housing market slowed and he or she can't compete with the big box stores?

Yes, Clark knows we opened up a Pandora's box with the Wall Street bailout, which he thought was a necessary evil. But it's a whole different issue when you're talking about bailing out individual corporations that have failed.

And much like the Circuit City gift card concern, if you buy a GM car and they go bust, will your warranty be any good? We've been getting so many calls about dealerships offering free tires for life and then going bust. Know that a promise only stands if the business is still around to honor it.

Back in 1980, Clark bought a 3-wheeled car called the Freeway. It got 100 mpg on a Tecumseh farm engine and had no reverse gear. Once he accelerated too quickly on a highway and the front lifted straight off the ground!

The New York Times now reports that a number of companies are introducing 3-wheel vehicles, including the Piaggio and the Aptera. Obviously, the biggest draw for consumers is fuel economy.

The all-electric Aptera will be available next year in California. Some of the vehicle's features include a top speed of 85 mph; going 0 to 60 in 10 seconds; and getting 120 miles on a single charge. But the price tag is very steep at $30,000. That kind of money ensures that you'll almost never make payback.

If you were upset about the $700 billion bailout, get ready to really blow your top. Cerberus Capital Management, which owns Chrysler and a joint stake in GMAC, received a $5 billion bailout from the feds in the days leading up to the election. That's because GMAC -- the financing arm of GM -- had become a wounded duck thanks to a spate of foolish mortgage lending.

You may recall that Clark grudgingly condoned the $700 billion that aided Wall Street. So why, then, would be opposed to the $5 billion bailout for Cerberus? Simple -- their collapse would not present the same kind of "systemic risk."

The only reason they got money is because of who they are; they count former Vice President Dan Quayle among their ranks.

Cerberus next wants to engineer a merger of Chrysler and GM, which would require more taxpayer money. It's being marketed as a way to stop imminent job losses. No way, says Clark. If we allow them to merge with our money, the real purpose will be to help the fat cats at Cerberus. Workers will lose their jobs anyway; we're way oversupplied in the car market and have too many factories as well.

If you're an autoworker who's now mad at Clark, realize that he truly doesn't believe your jobs would be safe with a bailout. The bailout would be solely to save the wealthy influentials. Of course, Clark would love to have a Cerberus rep come on air and dispute what he's saying.

One last thought: What kind of example do we set for the rest of the world when we start bailing out losers with the money from the winners? That's crony capitalism, that's a Third World kind of capitalism.

Yes, it may seem like Clark has a split personality. He supported the financial bailout as a necessary evil -- after all, capitalism requires capital to function -- but he's opposed to the Cerberus bailout. But it's a whole different game when you're being asked to take care of an industrial organization that didn't manage itself well.

The Detroit automakers -- already getting $25 billion from the government -- are now back on Capitol Hill looking for more money. In addition, GM and Chrysler want to merge and shift the responsibility for workers' pensions to us as taxpayers.

This may sound insensitive, but the reality is that workers always pay for the mistakes of management and benefit from their good decisions. Today, the Big 3 have too many factories and too many workers for what the marketplace demands in terms of vehicle production. There are also too many dealerships in the equation.

Clark is opposed to a private bailout for the automakers. By the way, this is 2 party deal with both Democrats and Republicans wanting to look like the good guys bailing out Detroit. But who's looking out for we the taxpayers?

And here's the dirty little secret that many people aren't discussing: Even if the GM/Chrysler merger goes through, there will still be massive layoffs and many dealerships will close.

Clark often gets calls from people who wonder if extended warranties on cars are worth it. Though he's not a fan of them, extended auto warranties can make sense in some instances.

Now Clark is getting calls from people being offered a unique kind of extended vehicle warranty that seems to be a real bargain. They're told they can purchase the warranty, and then if they never use it, they'll get back the money they paid. Turns out it's just a ruse.

The Kansas City Star reports there is a lawsuit concerning the sale of these money-back warranties that's been going on for 6 years! The plaintiffs, obviously, are having difficulty getting their money back. The court has now ruled that the warranty company should give the money back but…surprise…the company has since filed for bankruptcy. Good luck getting your money back!

Here's the lay of the land when it comes to cash-back warranties: The warranty companies market directly to dealers and get them to sell their warranties -- instead of a manufacturer's own -- at huge profit margins to both parties. But the warranty company itself doesn't even have enough underwriting to pay for repairs. They just collect money with no intention of paying it back out. Then they do what's called a "bust-out," which is essentially like filing for bankruptcy, and disappear with their share.

The end result is that you as a consumer are stuck holding a worthless warranty. So don't believe the claim that you'll get your money back at the end. If you do buy a car warranty, you want to be sure it is the manufacturer's own. Otherwise, it only has a marketing company backing it up, and it isn't worth the cost of the paper it's written on.

Clark wants to share a brand-new trend in the car market that affects the mass affluent automobile crowd.

Historically, only a small sliver of Americans would buy a luxury brand. Then Lexus changed the psychology completely with its late '80s entry into the market. They targeted the aspirational wealthy -- those who have a little more money than most people, but are not yet truly wealthy.

Lexus' entry into the marketplace was followed by rival Acura, which also adopted the business model of selling both moderate-level and entry-level luxury cars. That move then prompted BMW, Jaguar and Mercedes to bring some of their comparative models into the American market. All these factors combined to create a true mass affluent car marketplace.

But right now, the mass affluent folks no longer have the income they once had. Their HELOCs are being shut off and their investments are plummeting. The result? They're not buying any longer. This creates real opportunity, especially for used luxury and near-luxury cars that are being returned at the end of a lease. There's way too much supply. This is a real sweet spot in the market right now.

Meanwhile, Toyota has a new offer of 0% financing that seems poised to take advantage of GM's cash troubles. The Japanese automaker is cash-rich while the American nameplate is in a real cash squeeze. There's no way GM could afford to do an offer of 0% financing. This highlights a real split in the marketplace as some brands can offer the great financing deals and others can't.

Honda is the envy of the manufacturing world for the flexibility and efficiency of their plants.

Here's a question for you: How long does it take the Japanese automaker to go from making, say, an SUV to a different model of car -- on the same line in the same assembly plant? A stunning 5 minutes, according to a Wall Street Journal report. And how much does it cost? Absolutely nothing, thanks to the use of modular robots that can be quickly adapted.

By comparison, it takes Ford a whopping 13 months and a staggering $75 million to make a similar change at one plant. That's what Detroit is up against. We taxpayers are going to be asked to keep the Big 3 Motown automakers in business in the coming months. But in the free market, people always choose to buy from the most efficient producers.

Until the Big 3 can get creative solutions like Honda, it won't matter how much money we throw at them.

Car sales are at their worst level since 1993, with sales down 27% in the month of September. We've known for awhile that American automakers have been hurting, but the latest figures show that even Japanese automakers are ailing. Toyota's sales are down 32%; Honda is down 34%; and Nissan is down 37%

There are 2 main reasons behind the death spiral in the auto business. First, we've lost confidence in the economy and are afraid to spend money on big purchases. Second, even if you wanted to buy a car right now, many banks won't write loans because of the tightening of credit markets. That should work itself out as the behind-the-scenes credit markets thaw out and more money starts flowing again.

One tip -- try your local credit union if you are looking for an auto loan.

Suffering sales means that this is a great time to buy if you're able. The news about the slowdown hitting Japanese automakers means that you may be able to steal a deal on some coveted foreign nameplates. Of course, the best opportunity is always to buy used, especially if you're looking for a luxury model.

In related news, Clark reveals that he's sold his natural gas car, the Honda Civic GX. He credits T. Boone Pickens with raising awareness about natural gas vehicles, allowing him to capitalize on the market scarcity by putting his up for auction online. Clark sold it on eBay for far more than he paid for it a year ago. Now he drives his old standby Scion XB!

If you have an emergency and call 911, it feels like forever until the ambulance arrives, right? That's the mindset of the American people today as we instantly want automakers to put more fuel-efficient cars on the road.

Business Week recently reported on the Ford ECOnetic, a vehicle that gets 65 mpg, runs on diesel and is available in Europe only. Huh?! One of our automakers making a great vehicle like this and not selling it in the United States? It turns out Ford can't figure out how to manufacture the ECOnetic over here without losing money on each car!

As a nation, we went from wanting the biggest Terminator-style gas-guzzling SUVs to wanting total gas sippers almost overnight. But there's been major lag time on the manufacturing side.

Yet all hope is not lost. Clark promises we'll have a lot of choices over the next 24 months. By 2010, we'll have the GM Volt and other fuel-efficient cars. In the next few months, Honda will have an affordable hybrid available with a price tag in the upper teens.

It just takes a while to make a long-term change. We will get there as long as we don't lose focus when gas becomes cheaper.

Clark has a special warning for you if you're looking to trade in your old car for a newer one. It's no secret that some dealers are closing their doors because of sluggish sales. If you're wondering what that has to do with you, read on.

The problem is that many people trade in their existing car for another one before they finish paying off their loan. If the dealership is in financial trouble, they may not pay off the loan on your behalf. Then you're responsible for the payment on a new vehicle plus the balance of the loan on the first vehicle you traded in.

The Wall Street Journal reports Bill Heard Enterprises is among the dealers facing financial troubles that could lead to a scenario like this.

So, how do you protect yourself?

Well, for starters, let's take a step back. Why are you trading in a car you haven't finished paying for yet? That's a bad financial move. You should consider holding onto it. If you simply must get rid of it, sell the vehicle on your own to a legit private buyer to help pay off the loan balance.

The Detroit News reports that GM is running short of cash. The dire financial straits have prompted 2 recent major announcements from the automaker.

First, GM is offering a new warranty for used cars under their certified-car program. This is a highly unusual move that you can benefit from. This bumper-to-bumper warranty is for 12 months/12,000 miles.

The second announcement concerns employee pricing on new vehicles. This is not a gimmick. It's a longstanding perk that's been enjoyed by the employees of many American automakers. Now it's being extended to the general public in the hopes that they'll buy more GM vehicles.

Now is the time for great deals -- unless you're seeking a highly coveted small car or a hybrid!

Clark is often way ahead of the curve when it comes to money-saving vehicles.

Decades ago, he got a 3-wheeled car called the Freeway that got 100 mpg. Recently he read that an automaker named ZAP has teamed with the state of Kentucky to make an electric 3-wheeled car. The ZAP will go 40 mph and cost about 2 cents/mile to operate.

About 8 years ago, Clark bought his first hybrid -- a Honda Insight. Today, another hybrid called the Prius is in such demand that even 2-year-old models with 30,000 miles are selling for the manufacturer's suggested retail price.

Last year, Clark got the Honda Civic GX -- a natural-gas vehicle. Now comes word that his new ride is the hardest car to get in the United States!

That puts Clark in a dilemma: Should he capitalize on the situation and sell his Honda Civic for more than he paid for it? Or should he keep it and continue to enjoy the tremendous fuel savings? What would a capitalist do? He'll have to run the numbers and get back to you!

When it comes to research about reliable cars, there are two highly respected sources -- Consumer Reports and J.D. Power and Associates.

The latter's 2008 Vehicle Dependability Study shows that the most reliable cars are made by Lexus. They're followed by Mercury, Cadillac, Toyota and Acura.

When it comes to the worst of the worst, Land Rover is in last place -- again. Faring slightly better were Suzuki, Kia, Isuzu and Saab. In fact, Saab was named as the most-improved nameplate this year.

In addition to J.D. Power's tally, you should also check the April issue of Consumer Reports each year -- particularly if you're in the market for a used car.

If you're a longtime listener, you know that Clark has frequently bashed vehicle leasing. He's called it a recipe for financial disaster, and he's said it's only good if you like new wheels every few years or have a special factory-subsidized lease.

Well, the penny-pinching guru now has egg on his face.

Earlier this decade, automakers were really pushing leases on SUVs. The monthly payments were calculated based on what the automakers thought the vehicles would be worth 3, 4 or 5 years later.

But now that gas is so expensive, no one wants SUVs and their value has dropped severely. So the value of a typical SUV may be down $10,000 when you turn it in. Automakers are suffering billions in losses as a result. Chrysler has stopped all leasing completely, and both GM and Ford are seriously cutting back.

So if you ignored Clark's longstanding advice and leased an SUV, you look awfully smart right now. But this was an unusual circumstance. The reality is that domestic automakers can't afford the costs of leasing. The luxury European brands will still do them. But the real bargains in luxury cars are always used.

If you have need for an SUV -- because of your business or family life -- this is the best time to buy a used one. Zig when others zag.

Meanwhile, the best deals on fuel-efficient car are Korean -- Kia and Hyundai. But beware that neither really holds its value when it comes to resale.

Over the last few weeks, we've received hundreds of calls from people who wonder whether they should ditch their old gas-guzzling SUV/truck and buy a newer fuel-efficient vehicle to save money.

Clark usually says that it doesn't make sense to do so. But that's just general advice without looking at the numbers.

If you want to get really granular, Smart Money has a new interactive tool that features 11 variable fields where you can enter your trade-in value, gas mileage, daily driving distance, etc. The tool calculates how long it takes to start getting payback.

You may not like the answer you get. Sometimes the only way to make it work is to buy a used gas-sipper. In this respect, cars from Hyundai and Kia tend to depreciate much quicker than those from Honda and Toyota.

And if you're stumped on your trade-in value, know that Edmunds, Kelley Blue Book and others haven't stayed current with SUV/truck values. So deduct about 25% from whatever they say.

Motorcycles have gotten extra cheap these days. We went through a time when people only wanted high-end motorcycles, but now there's a new marketplace for those who feel the need for speed -- on a budget.

Some freeway-legal 150 cc scooters and motorcycles made in communist China start at $1,000. So it is possible to get 55-70 mpg on the cheap and ride in the carpool lane in heavily congested urban areas.

One special caveat: Motorcycles are not without risk. Weekend joy-riders can be a danger to themselves and others. Clark advises taking a motorcycle safety course before riding -- even if it seems un-macho. Visit the Motorcycle Safety Foundation at MSF-USA.org to find a course near you.

Clark loves the idea of you saving money, but he wants you to be safe and careful out there. Car drivers are nearly incapable of seeing riders in traffic, as he's discovered while riding his scooter.

The Internet is truly going to be everywhere. Chrysler is putting a wireless Internet service called UConnect Web in all its cars. The hope is that people won't create a road hazard by surfing while they drive!

This idea of the Internet in vehicles became popular with the high-end bus services that operate on city-to-city routes throughout the Northeast. The bus carriers put in wireless Internet capabilities in a bid to attract business travelers.

Meanwhile, American Airlines is testing Internet for it fleet of planes. AA is using strategically placed towers -- similar to cell phone towers -- to implement the technology. Clark expects the market price will be around $10 a flight.

Boeing lost money when they tried equipping their planes with Internet capabilities using a satellite-based technology. Their price point would have been around $30 a flight.

Some travelers see airplanes as the last sanctuary away from work, but Clark would like the ability to surf the 'Net at 30,000 feet -- if the price is right.

The IRS has new numbers on mileage standards that are up to just under 60 cents/mile. Clark has traditionally said that it costs you around 50 cents a mile to operate a vehicle, but now that's obviously changing.

Fuel is only a part of the cost. But we've become so myopic by only focusing on the mpg ratings. In fact, people are making emotional auto-buying decisions based on those mpg ratings.

Clark's Dash unit has added a feature that lists nearby gas stations and their prices. That goes to show our fixation on gas prices. Likewise, comparison sites like GasBuddy.com and others are booming.

But Clark encourages you to step back and think about the big picture. Even with $4/gallon gas, it's the overall cost of a vehicle that matters: Depreciation, insurance, the cost of your loan, maintenance, repairs, etc.

If you go from a gas guzzler that's paid for to a new vehicle with a 5-year loan, think about the cost of that loan every single month. Not to mention that dumping your gas guzzler will probably get you awful trade-in value.

You may need to reconsider that choice.

While the price of oil has our attention, there's a renewed focus on finding cars that have the best fuel economy. Yet such vehicles are not necessarily the cheapest to own and operate.

For example, hybrids are hot right now. But they're not cheap to own. In fact, Edmunds.com has only 1 hybrid in the Top Ten on a new tally of truly cheap cars. (Editor's note: All picks are 2008 models.)

In addition to standard fuel costs, Edmunds looked at the purchase price; the rate of depreciation; the cost of insurance and more in making its selections. One word of warning: You can't draw any inferences about quality from this list; it only pertains to the raw costs associated with cars.

Without further ado, here are the 10 cheapest cars to own and operate:

1. Chevy Aveo
2. Hyundai Accent
3. Honda Fit
4. Toyota Yaris
5. Honda Civic
6. Nissan Versa
7. Kia Rio
8. Mazda 3
9. Toyota Corolla
10. Honda Civic Hybrid

As you can see, these are all smaller cars. They all get around 30 mpg (composite) for average fuel economy. But their true cost is so much cheaper than most of the hybrids.

Out of this list, several cars also come highly recommended by Consumer Reports. They include the Fit, the Mazda 3, the Versa and the Honda Civic/Honda Civic Hybrid.

The car market continues to take a beating, with the latest blow coming from a horrible sales month in June. Fitch Ratings, meanwhile, has downgraded Chrysler and GM -- citing weak sales and rising fuel costs, among other things.

Ford is also struggling with collapsed sales. The F1 Series is falling further down the list, and Ford is delaying a new remake because they can't sell the old ones.

In short, any automaker that has had a heavy emphasis on unloved giant trucks and SUVs is hurting right now.

So what's a Big 3 automaker to do? Well, in the case of GM, they're offering sweeping rebates and great buying opportunities. Look for 0% interest on a 6-year loan and possible additional cash rebates.

Clark doesn't even like 5-year loans…and here they're pushing 6-year ones!

But here's the bottom line: If you are in the market for a new SUV or pickup truck, there's never been a better moment to buy one. You're also likely to steal great deals if you're looking at used vehicles.

One caveat: As Clark has mentioned before, you should try to get it in writing that your Chrysler warranty will be honored no matter what.

You've probably heard anecdotally that the cars we're buying have changed. GM, Ford and Chrysler are wounded ducks right now because so much of their business is in larger vehicles. New data shows that sales of the Big 3 have dipped below that of the smaller Asian cars for the first time ever.

The No. 1 selling vehicle is now the Honda Civic -- not the Ford F-Series pickup truck as it's been for years. In fact, sales of big SUVs are down to just 4% of the entire market.

People stuck in a new gas guzzler are always torn between keeping it and dumping it. Typically, you're better off keeping it and budgeting for the high gas prices. The reality is that fuel is still a small amount of the total ownership cost of a vehicle.

But if, for example, you have a 4-year old SUV, you may want to think about dumping it for a used fuel-efficient car. Depreciation will threaten your wallet more than the actual fuel costs.

Clark recently saw an analysis that found driving an SUV for 15K miles/year over a period of 5 years will cost you $100K. That factors in purchase price, maintenance and fuel.

The July issue of Consumer Reports has a cover story about gas-saving cars. There's a new top dog out there and it's the Hyundai Elantra SE. The No. 2 car is the Honda Civic EX (manual). Other top choices include the Toyota Prius, Mazda 3 and the Subaru Impreza. In the class of extra-small cars, the Honda Fit and Nissan Versa both got kudos.

Here's an unexpected development: Traffic in Los Angeles is not as bad as it used to be! Anecdotally, traffic anchors have been saying that commute time has reduced significantly. The Los Angeles Times theorizes it's because of the price of gas.

In fact, our gas consumption is down throughout the United States. So we do respond to price, though a 10% increase in price does not mean 10% of us will give up driving. It's more like a ratio of 100:1!

Consider this: Ultra cheap inter-city bus companies like Mega Bus have been successful in the Northeast and Midwest. But not so in Southern California. In fact, Mega Bus may pull out of Los Angeles because of low ridership. It would seem that Angelenos are willing to drive less, but they're not willing to ride a bus with strangers.

Across the country, what people buy and drive is changing. In multi-car households, folks are choosing the fuel efficiency of their smaller cars rather than the comfort of their larger vehicles.

Meanwhile, RV sales have collapsed. People who have them are parking them, and local RV dealerships are going out of business. But with hazard comes opportunity. If you like the RV lifestyle, now is a time to steal a sweet deal on this most unloved of all vehicles. Deals will be especially sweet on used RVs, which historically suffered heavy depreciation even in the best of times. The Wall Street Journal reports that the average price of an RV is down by a third in the last 2 years.

CLARKONOMICS: Your favorite penny-pincher walked to the studio today. It’s something he likes to do several times a year when the weather is nice. Clark lives only 5.6 miles from the studio and the cost to walk is free. In fact, Clark saved about $6 today by not operating his car…and he got exercise. It’s like his own Declaration of Independence from high gas prices.

The futures market is showing oil at $140/barrel. Less a year ago, we forget that oil was under $50/ barrel. There has been a massive run-up in price, especially for airlines and other transportation-based businesses.

Most people aren’t fortunate enough to be able to walk to work like Clark. But there’s always something you can do to fight back against the high prices at the pump. For example, Honda will be rolling out a huge new fleet of affordable hybrids in 2009. The payback should be very quick for buyers; the hybrid version of a car will only be about $1,900 more than the traditional gas engine version.

Nissan, meanwhile, is launching a battery-powered car in the next 2 years. They’ve partnered with NEC to make a new battery for plug-in hybrids and electric cars. It will be beta tested in forklifts, so beware if you’re an operator!

The point is there are real solutions coming. Oil was previously so cheap that we could almost be forgiven for not being more energy smart. But to paraphrase Winston Churchill, “The American people are finally getting around to doing the right thing after trying nearly everything else.”

There are some disturbing stats out about seat belt use. Only 80% of us wear them; that means 1 in 5 goes unbuckled!

Clark took high school physics. While he didn't understand much, he did understand the part about flying through the air during a sudden stop! The National Highway Traffic Safety Administration reports that 68% of teens who were killed in nighttime car crashes weren't wearing seat belts. Parents, you're responsible for drilling the seat belt message into their heads.

In Europe, new drivers are required to display a scarlet letter on their vehicles. It's a huge red-and-white "L" that helps alert other drivers to be extra vigilant around them. If we had that system, it would give police a heads-up to observe the behavior of young drivers.

Clark's 19-year-old daughter has been driving since she first got her learner's permit 4 years ago. By her own admission, she's still "learning" how to drive. Christa, meanwhile, is worried about when her 5 year old gets ready to drive.

In certain states, it's considered a badge of cool to not wear a seat belt. The top 3 offenders in this category include New Hampshire (the "live free or die" state), Massachusetts and Arkansas. On the flip side, Hawaii and Washington state are the best places when it comes to wearing seat belts.

Clark has a natural affinity for smaller vehicles. But just how safe are they? The Insurance Institute for Highway Safety now says the Smart Car, which seats 2 passengers, has earned top ratings for side and front crash tests. The Honda Fit is another wundercar that's been built from the ground up to be extra safe.

This is a big change from the days when all small cars were considered unsafe. Today, small does not necessarily have to mean dangerous. While you can't defy the laws of physics, you can counteract them with good engineering.

Suzuki and Chrysler are both offering fixed-price gas opportunities to drum up sales on select new models. With Chrysler, you get gas at a fixed price of $2.99/gallon for up to 12K miles for 3 years. Suzuki, meanwhile, is offering free gas for a number of months. There's been no match so far from either Ford or GM (Editor's note: Info accurate as of 05/15/08).

The Wall Street Journal ran some "what if" numbers on a variety of Chrysler models to see if their gimmick holds water. It turns out that gas would have to go up to about $4.10/gallon for their offer to pay off. No numbers were crunched for the Suzuki promotion.

So you've got to decide whether you are an optimist, a realist or a pessimist. The realists will say that gas may go up to around $4/gallon, as it already has in parts of California. The pessimists, meanwhile, will say that gas could go as high as $200/barrel!

Clark, however, is an optimist. He believes the price of gas will get lower. Our demand is already declining in the face of higher prices. Yet there is increased demand from developing economies around the world. So Clark is really in the minority when it comes to his viewpoint.

If it were Clark, he would take a cash rebate instead of the gas option from Chrysler. But you have to decide where you stand…

What we're buying in terms of vehicles has changed greatly. The typical behemoth 8-cylinder SUV has given way to the more economical 4-cylinder car. That switch alone can represent a savings of $1,500 or $1,700 in gas over the course of a year.

The Toyota Prius is selling consistently after initially being seen as a curiosity item in the market. The Toyota Yaris, Nissan Versa and Honda Fit are also popular sellers. But does it make sense to ditch your huge vehicle and get one of the wundercars? Usually, it does not -- unless you're at the end of your natural buying cycle. But to prematurely dump your vehicle, the numbers probably won't work out in your favor.

If you are in a gas guzzler and want out, try buying a used gas sipper. This may not be "sexy," but you can always buy that new car smell in a can.

Then there's the safety issue. Clark was recently talking to someone who has an Expedition and raised this point to him. Today's smaller cars aren't exactly "econoboxes" like the Datsun B210 that Clark got new in the mid-'70s. That dinky-mobile came with no radio, no AC and the floor was just a vinyl sheet over the metal! But the truth is that you can't outsmart physics, so if the Expedition hits a smaller car…

It used to be that weather was the safest casual conversation starter. Today it's the price of gas. Clark was stunned when he was filling up his wife's car and the bill came to $57; he knows that many folks can top that easily, but it was shocking to him! Recently while filling up a rental car, the pump didn't shut off properly and spewed out additional gasoline. Every last drop is precious these days. We are in a time when the high prices have us more focused on alternative solutions than ever before.

Clark loves his natural-gas vehicle, but that type of car hasn't been embraced by the masses. It can be difficult to find a filling station. Still, he firmly believes that American ingenuity will come up with answers to end our foreign oil dependence.

Here's an example: A man named Floyd Butterfield started the E-Fuel Corporation and is selling a home-fueling station that's the size of washer/dryer stack unit. It allows you to take sugar and make it into fuel to power your car. The price of the device is $10K, so the payback is nowhere near immediate. The New York Times reports that the sugar it would take to create a gallon of fuel would cost around 30 cents.

Will this catch on? Is it vaporware? We don't know yet. But the point is bright people are working on alternatives to power our vehicles. GM is preparing an electric car called the Volt, and Toyota is working on its plug-in hybrids. Meanwhile, there are experiments to turn tree waste into fuel, and Pres. Bush is a fan of switch grass as a fuel.

Many of these experiments won't prove viable. But we're at a new time when we're willing to listen and learn from people we might have dismissed as kooks in the past. For example, Clark is a fan of electric bikes for city commuting. They cost a third of a cent per mile to run and emit nearly zero pollution. Just be prepared to get wet on rainy days!

If you heard Clark recently talking about Chrysler, you know that he expressed concerns about the company's financial health since they're privately held and don't report losses like other automakers. In today's challenging economy, it's not uncommon for car companies to struggle with decreasing sales. Clark just doesn't want to see consumers having their warranties ignored in the event that the company folds. He was very careful to emphasize that he had no inside knowledge about whether Chrysler is ailing or not. How could he if they don't disclose that info?

Well, the Chrysler people got very upset with Clark and promptly contacted him. They sent us the following statement and asked that we read it on air and post it on the website:

  The statements recently made during the Clark Howard Show regarding   Chrysler LLC "going bust" and not honoring its vehicle warranties are   simply unfounded and untrue.

  There are no plans for Chrysler to go out of business, abandon its dealer   network, or default on its vehicle warranties.

  Chrysler has established long-term product plans and has shown its   commitment to its customer base and employees by forming strategic   partnerships, recently with Nissan.

  Chrysler LLC has ample liquidity. We are fully funded with working capital   to meet our present and future needs and objectives. We are putting our   capital to work effectively and efficiently, streamlining inventory,   improving current products and developing new and innovative vehicles.

Let's clarify something about Clark's original remarks made on April 2, 2008. He never said Chrysler is filing for bankruptcy. This rebuttal doesn't address his concern that dealers need to seek firm assurance from corporate that warranties will be honored no matter what. Buyers deserve more than just words; they need it in writing.

Clark remembers the calls he took from people when Korean automaker Daewoo went bust and didn't honor its warranties. Once bitten, twice shy. A lack of transparency sows seeds of doubt.

The Norwegians have a new electric car coming to the United States in 2009 that's got Clark very excited. It's called the TH!NK City and it gets 110 miles on a single charge and goes up to 65 mph. The cost? About 2 cents a mile! And it doesn't eat up foreign imported oil like a gas-engine vehicle.

In other news, a group of researchers in the lab have developed an easy way to take sugar and turn it into a power plant for a hydrogen-powered vehicle. This development is not ready for the mainstream yet, but it's in the works. There are a lot of promising advances that are going to take a while to materialize in the marketplace.

In the meantime, Clark wants to encourage you to look at offbeat transportation alternatives. Washington D.C. has launched a Smartbike program. You pay $40/year for access to bicycles that are strategically placed around town. Users have a code to unlock the bikes and lock them up again at the other end of their commute. It's almost like a Zipcar program for bikes!

Worried about getting too sweaty during your ride? Buy an electric bike for around $600 and it will be no sweat getting around. Clark knows this all sounds kooky, but we need to expand our minds and realize we're not sitting ducks for foreign-oil interests. Christa has long had a fascination with a bicycle that runs on a weed whacker motor. If you Google "weed whacker bicycle," you'll even find videos that detail how to convert your bike.

The car business continues its downward spiral. New figures for March show that GM and Chrysler are down 20% and Ford is down 14%, year over year. Ready for the stunner? After defying slowdown, Toyota now is down 10%. Honda is the only of the Big 5 automakers that emerged flat but unscathed. Be on the lookout for deals!

One word about Chrylser, but Clark wants to preface this by saying he's hasn't heard or read anything to substantiate his beliefs, nor is he trying to kill business at Chrysler dealerships. He's just concerned because the company was recently taken private and is being run by non-automotive people. So should the company go belly-up, he fears the owners might just shrug their shoulders and move on to managing other assets in their handsomely diversified portfolio. Chrysler dealers might want to get assurances from corporate that warranties will be honored even if the company goes bust. Again, Clark has no inside knowledge about whether Chrysler is ailing or not. He's just thinking ahead about possible future scenarios.

Finally, if you like fancy cars, this is a good time. Porsche sales are down 26% and Lexus is down around 20%. The theory that the rich would continue buying status automobiles through the lean times has proven false. And keep in mind that cash is king at the dealerships as loans become harder to get.

In Clark's TV work, he recently reported on a website that offers an interactive tool that should help the owners of old gas guzzlers. The site addresses that all-important question: Does it make sense to keep it or dump it and get a brand-new fuel-efficient vehicle? Before you play around with this tool, you should realize that the cost of a car is more than just the price of a gallon of gas or a barrel of oil. You have depreciation, maintenance, insurance, repairs and interest on the loan if you're not buying upfront.

What kind of gas mileage are you really getting? To find out, fill up your tank, set your trip odometer to zero and drive your normal route over a tank of gas. Then fill up again and divide the number of gallons you buy into the number of miles you drove. Keep in mind that if you replace your gas guzzler with a used car of similar age that gets great fuel economy, well, the math is irrelevant for you. You've simply bought like to replace like, in terms of age.

Clark's been hearing some interesting things in the car market. For the longest time, 4 cylinder engines were unloved. Now they're back with a vengeance. If your last 4 cylinder went from 0 to 60 in a day and a half, the technology has changed so much over the last few years. Today's 4 cylinder engines are more powerful and get better fuel economy than yesteryear. Meanwhile, sales of ultra-small cars like the Honda Fit have shot through the roof. So Clark's advice is look one size bigger for a steal of a deal. You'll get less depreciation over time and the slight decrease in fuel economy won't be much to outweigh the potential savings upfront.

There's great news for your wallet coming to a car lot near you. Automakers have been trying hard to scale back production to get supply and demand in sync. But it's not working; demand is dropping quicker than they can cut back production. There's simply too much product out there. Couple that with the fact that repossessions are skyrocketing and the housing slump is cutting into people's car budgets -- it all adds up to a perfect storm for the savvy car shopper. The Wall Street Journal reports that domestic, Japanese and European automakers are all offering great deals such as 0% or 1% financing and big rebates.

Edmunds.com will keep you up to date with the latest incentives. Keep in mind that sometimes a credit union car loan at 5% with loads of cash back from the manufacturer is a smarter move than an offer of 0% financing from the dealership with no cash back. So arrange your financing in advance, know the market and avoid "the grind" at the dealership. Start pricing vehicles at CarsDirect.com. They'll give you a fixed price that you can use as a reference point. You may even find that their price is the best. Surprisingly, people love the Internet for researching cars, but they always go to the dealership and face "the grind" when they want to seal the deal. Old habits die hard.

USA Today reports that car repossessions are headed to the highest level they've been since the '90s. In addition, people are stretching out their loans way beyond the generally safe 42-month mark. A longer loan means that you're usually going to be upside down in your vehicle. This year, 1.6 million cars will be repossessed. Clark recently spoke with a man who does repossessions. These people have a very tough job, but they are just the messenger, not the message itself. It's not the lender in the fancy suit that does the dirty work of repossession.

Consumer Reports' annual auto issue is out and Clark is giddy with excitement. The April '08 issue definitively says that extended warranties aren't worth the investment. Clark has historically been neutral on extended warranties for vehicles, but now he'll have to revise his opinion. Only 20% of people ever recoup the cost of the warranty vs. the cost of repairs over the lifetime of a vehicle. If you're buying a Mercedes, you'll have the best chance (about 40%) in that regard. Other vehicles where a warranty may be a smart move include Pontiacs, Jeeps, Chryslers, Buicks and Dodges.

In other news, there's a new champ when it comes to reliable small cars: Hyundai Elantra. Other top picks included the Honda Accord (family sedan); Toyota Prius (hybrid); Toyota Sienna (minivan); and Hyundai Santa Fe (SUV). American cars are getting more reliable, but they're not quite on par with the Japanese vehicles yet.

When it comes to the best used cars, they're all Japanese: Toyota's Prius, Highlander, RAV 4 (4 cylinder), Corrolla and Honda's Accord (4 cylinder). A new category this year was vehicles that are unloved, but good to own. This category was dominated by Korean vehicles such as the Kia Rondo and the MAZDA5.

Automakers are starting to build vehicles with the idea that people are spending more and more time in their automobiles. A major trend among manufacturers at Detroit's North American International Auto Show was creating vehicles that are like rolling houses -- not necessarily in their size, but in their amenities. Clark and his executive producer Christa both have Honda Odysseys that are 4 years apart. It's instructive to see how much has changed in such a short period of time. Christa's newer Odyssey has multiple outlets for video players, tons of cup holders, fancy pop-down wireless video screens and seats that fold down very easily. Some vehicles are even being built with power inverters for laptops, and Sirius satellite radio is offering TV channels so you don't have to carry around DVDs for your kids. It's like cars are becoming a destination instead of a means to reach a destination.

After years of declining or staying the same, auto insurance rates are now headed in the other direction. Allstate and Progressive are both raising premiums aggressively in 20 states, according to Bloomberg. There are a few factors contributing to this reversal. First, the availability of Internet insurance quotes sparked a battle for market share that has exhausted many of the insurers. Now their focus has turned from stealing customers to making more money for their own stockholders through higher premiums. Meanwhile, The Wall Street Journal reports that insurers are suffering more losses in collisions as people buy cars with greater horsepower. More horses under the hood increases the level of accidents as people drive more aggressively and speed. The conventional wisdom about calling your insurer to find out what it will cost to insure a car before you buy is again great advice. Plus, it's even more important now than ever to shop insurance rates.

People are buying sub-compacts vehicles like crazy these days. Clark loves to ride around in sub-compacts when he's overseas in Asia. Foreign markets are all about the economy of packing as many people into a vehicle as possible. For example, Clark's Scion XB seats about 5 people over here, while 12 people will squeeze into the same vehicle over in Japan. Even high-end manufacturers like BMW and Mercedes are getting into the sub-compact market with their 1 Series and SmartCar brands, respectively.

Because of the sub-compact sales frenzy, you may now be able to buy one size larger for less than you would pay for a sub-compact. The fuel economy losses in going bigger may only be a couple hundred bucks a year. Even Clark who is obsessed with dinky cars knows there's more comfort in compacts like a Toyota Corolla. While Clark has pre-ordered the SmartCar, he may still decide to go with a compact instead. Dinky-mobiles deprecate at a faster rate than compact cars. Plus, the additional fuel economy they give may not offer you as much bang for your buck as you'd get by stealing a deal on a compact.

Clark recently overheard a man at the studio talking about shopping for a new car. One question that popped out of his mouth surprised Clark: "When did the average cost of a vehicle become $35,000?" It got Clark to thinking, "What kind of cars is he looking at?" Vehicles are the best deal they've been in a long time. We choose to gingerbread them with extra features and gussy up the price. But you can still get a fantastic new car for no more than $15,000.

There's a huge market for affordable auto transportation, and Clark means really affordable. Several years ago, he told you about a vehicle called the Logan by Renault. This 4-door sedan is available in Europe fully equipped for $6,000-8,000. Meanwhile, India has a $2,500 car entering its marketplace on Jan. 10. The vehicle is being introduced by Tata Motors, a company that's set to buy Jaguar. Talk about the opposite extreme of vehicle price!! Unfortunately, these kinds of affordable vehicles aren't available stateside yet. Many people are stuck in the '80s when it comes to thinking about affordable vehicles. If the terms "low cost" and "cars" make you automatically think "Yugo," you owe it to yourself to re-examine the new wave of today's low-cost cars. But keep in mind that, as Clark recently told you, the real deals in '08 will be with used cars.

Car prices are headed into a free fall. Records show that sales were anemic in 2007 -- the lowest they've been in 9 years. Now comes word that '08 sales are expected to be even worse! So the opportunity for car buyers right now is tremendous. Car dealerships are in complete turmoil because there are simply too many of them in the United States. Manufacturers, meanwhile, are trying to guess how much they should slow production. But they won't be able to dial back quickly enough. The Financial Times reports that the best opportunities in '08 will be in used vehicles, not new vehicles. There's a huge surplus of used vehicles because of repossessions, trade-ins or leases that have ended.

While Clark loves used cars, the only danger is that you'll buy someone else's trouble. So do it right from the start: Get the vehicle inspected by an independent mechanic -- even if it's been "inspected" at a dealership such as CarMax. Always beware that you buy as is when you buy a used car. In fact, salespeople in some states may be allowed to lie to you about the past history of a vehicle. So which dealerships are trustworthy? CarMax is one company that's beloved by Clark. They researched what people hated about the industry and eliminated it from the buying process. In Europe, a man who heard about Car Max opened a clone. Now it's the fastest growing dealership chain over there. You can't go wrong when you treat people right and make everything simple, honest and clear.

Auto loan delinquencies are skyrocketing; they're reportedly the highest they've been since 1991. That's a sure sign of economic slowdown. Whenever people have been squeezed in the past they'd do a home equity line of credit. But now those equity lines are tapped. That's why it's very important to stay current on your car loan. The interest rates are generally good, but the penalties for default can be huge.

And let's not even speak of repo. Having your car repossessed is doubly harmful. Not only do you have to find other ways to get to work, but most states have what's known as "deficiency." This is what happens when the lender sells the repo car at auction and gets below wholesale value. They're then legally allowed to bill you for the deficient amount. If you can't pay it, they can sue you and get a judgment against you.

So if you're having trouble making your car payments, get in touch with your lender and try to arrange a forbearance to avoid repo. Under the terms of forbearance, the payments you can't make now will likely be tacked on to the end of the loan.

One final word about prioritizing your debts: If you're really pinched, don't pay that credit card! Pay your mortgage, food and medical expenses and your car loan first. Put the credit card collectors on ignore until you're able to begin paying them again.

Have you heard that Congress has reached an accord with automakers and environmentalists to have a 50 percent increase in fuel economy over the next 12 years? It's not yet clear if such a bill will make it to the President's desk. But we've got to get our act together for long-term economic strength. Otherwise, our dependence on foreign oil will make us a 98-pound weakling in the international arena. It's difficult to picture exactly how increased fuel economy will look. With that in mind, Clark wants to tell you about the Suzuki Wagon R (pictured here), which has been the No. 1 selling car in Japan for nine months in a row. Clark first saw this vehicle during a staff trip to Japan. The closest thing Clark can compare the Wagon R to is the old Scion XB, but even that's larger than this toaster on wheels that gets 60 mpg with a traditional engine. Unfortunately, Suzuki has no plans to sell the vehicle over here.

People are also bonkers about buying the SmartCar when it arrives next year on our shores, but that only gets 42 mpg in comparison! Other ways we'll be seeing increased fuel economy at play include clean diesel vehicles, turbo boosters on engines, hybrid designs and more. There are also some things coming that you might not be able to imagine easily, such as SUVs that are not truck based. Manufacturers will simply take a regular car platform and slap on a different top. The result will be an SUV that's easier to drive and offers better fuel economy, among other benefits. Clark gets a kick out of seeing tiny women driving huge SUVs when he drops his daughter off at school. Some moms just won't be caught dead in a minivan, which is considered the height of un-cool!

Several automakers announced new plans for alternative energy cars at the recent Los Angeles Auto Show. Honda unveiled its Clarity, a hydrogen powered fuel-cell vehicle. The Clarity will emit zero pollution. A 3-year lease would run you about $600/month, so it's not exactly cheap. Honda will be marketing its vehicle in Southern California, where there are several dozen hydrogen-filling stations. Chevrolet/GM has plans to put around 100 of its hydrogen vehicles on the road in SoCal under the Equinox nameplate. Meanwhile, Ford is working to launch its plug-in hybrids. Those kinds of cars usually run on electricity for the first 40 miles before they kick over to a gas-powered engine. Clark salutes the entrepreneurial spirit of these automakers who are experimenting with new kinds of cars. Some of you may remember when Clark previously spoke about a car company called Tesla that's building a $100,000 electric sports car. Their goal is to use proceeds from initial sales to fund further research into developing alt-fuel vehicles that will be much more affordable for everybody. This is exactly the kind of entrepreneurial spirit that will help us move away from the environmental and national security dangers that go along with gas engines.

Your car is the second most expensive purchase you're likely to make after your home. So people often ask about which vehicles hold their value best after 5 years. To answer that question, Kelley Blue Book has just released its 2008 Best Resale Value Awards tally.

The winner is Volkswagen, which is making a comeback after some recent big losses. VWs keep just under half their value after a 60-month cycle. The other brands that round out the Top 10 are BMW, Acura, Honda, Porsche, Subaru, Lexus, Infiniti, Audi and Toyota.

On the other end of the spectrum, the worst brand to hold value has been singled out as Suzuki. With Suzukis, you only get about a quarter back for every dollar after 5 years. Other cars that really stink when it comes to holding value include Kia, GMC, Mercury, Dodge, Chrysler, Lincoln, Jeep, Ford and Jaguar.

On a related note, the Insurance Institute for Highway Safety (IIHS) says that the Subaru Impreza is the only small car that meets its strict safety standards. There were tons of midsized vehicles green-lighted by the IIHS, but not so in the large vehicle categories -- despite what you may remember from high-school physics!

There's one call that Clark has taken on the air about 60 times over the years, and he's never been able to answer it convincingly: Is it worth it to pay the extra bucks to buy a hybrid just to pay less in gas every week? Now Edmunds.com has done a cost analysis of some of the top hybrid models. Their research indicates how much longer it takes to get a return on investment if you buy the hybrid versions of any cars in the study. It's the Ford Escape that gives you the quickest payback -- owners will break even at around 3 years. The Honda Civic and the Mercury Mariner tie at No. 2. The Saturn Vue checks in at No. 3, allowing owners to break even in 4.8 years. Keep in mind that any hybrid offering return on investment in under five years is a smart buy. On the other end of the spectrum, the Toyota Highlander takes 11 years before you break even and the Camry will take you 12 years. And what about the Prius? Because there's no exact gas-engine equivalent, Edmunds looked at the Prius vs. Corolla. Turns out it will take you a whopping 13.6 years to get payback if you only drive your Prius 15,000 miles/year! So Toyota -- the greenest of all the automakers -- actually does not give you good payback on your hybrid-purchasing dollar. Clark advises people to only buy a Toyota hybrid if they're doing it because of deeply held environmental beliefs.

Clark continues to receive many questions about the used Honda Civic GX he just purchased. Typically, a new GX runs about $25,000 versus $17,500 for a standard Civic. But some folks have been wondering if the extra investment is worth it. One boon to buyers is that you receive a $4,000 federal tax credit when you purchase this no-pollution natural-gas vehicle. Meanwhile, operating costs are about $1.20 per "gallon," though you don't fill up with traditional liquid gas. Clark instead uses compressed natural gas, which is largely produced here in the United States. He'll report back and let you all know if his GX purchase proves to be crazy or not. Meanwhile, the government has issued new fuel economy numbers for automobiles at FuelEconomy.gov. The push to get new numbers really gained momentum when people bought the Toyota Prius and found their sticker numbers could be inflated by 30 percent. But all 2008 vehicles going forward will feature the true miles per gallon figures. Note that you get greater value for your buck when you go from a vehicle that has 15 mpg to one that has 25 mpg -- rather than going from 25 mpg to 35 mpg. It's all about ratios. So it may make sense to buy a car with good mpg versus great mpg. It's that initial leap in fuel economy that gets you the biggest bang for your buck.

Last winter, Clark first started talking about natural-gas vehicles (NGV). He loves them because they don't pollute the air and they use domestically produced fuel. His wife encouraged him to get one, so he searched on the Internet and a found used 2007 Honda Civic GX. Clark admits that this could either be a really dumb purchase or a really smart one. Honda is making about 400,000 of these cars per year, but they're only for sale in California and New York. The cost is about $25,000 for an NGV versus about $17,500 for a standard Civic. One of Clark's challenges in having an NGV is finding a place to fill it up with specially compressed natural gas. There are a lot of filling stations on the West Coast and on the Eastern seaboard down through Richmond, Virginia. But in the Atlanta area there's only one single station in a more than 200 mile radius! Luckily that station is about seven miles from Clark's home. Clark believes that as a nation we need to start thinking outside of the box about our energy needs. Relying on foreign energy suppliers who want to harm us can only weaken our nation. Clark's Honda GX is his answer to this dilemma. What's yours?

Consumer Reports has released its annual vehicle reliability survey and Toyota has come out with a black eye. For the first time ever, the Japanese company's Camry has been dropped from the recommended list. Toyota made a corporate decision a few years back to become the world's largest automaker. In doing so, they had to take the focus away from making quality vehicles and shift it to growth. That explains why Toyota as a whole now checks in at No. 5 on Consumer Reports' tally of the most reliable vehicles sold in the United States.

Meanwhile, Ford has emerged as an unlikely hero in the report thanks to its enormous jump in quality. The "Not your Father's Ford" tagline is taking on a new meaning and people can no longer joke that Ford stands for "fix or repair daily."

The top carmaker remains Honda, followed by Acura and Scion. The first American nameplate on the list is Buick, followed by Mercury and then Ford. The least reliable car sold in the United States is Land Rover, followed by Hummer, Cadillac and Mercedes.

Cars speak to us emotionally. Clark's producer Joel bought a 2000 Nissan Altima recently that doesn't really stir his emotions; he simply views it as dependable transportation. Joel might have picked a Honda Element if he were buying on emotion alone. Christa, Clark's executive producer, has named the hybrid version of her standard Lexus RX 300 as her dream car.

Sometimes it's hard to step back from the emotional side and make a smart auto purchase. But think about the underlying hassle that comes with purchasing an unreliable vehicle.

When you're ready to go car shopping, get pre-qualified for a car loan from a credit union and then get Consumer Reports' annual auto buying guide. Try to find a balance of quality and that emotional X factor and you'll be on your way to a great car purchase.

Clark's associate producer, Joel, has been in need of new transportation and now he's got his hands on a great used vehicle. His old Honda Accord croaked on him and he'd been very patient looking online for a used car over the past few months. By checking Craigslist.org on a daily basis, Joel was able to snag a 2000 Altima with 139,000 miles for $3,200. Clark's executive producer Christa used AutoTrader.com to buy a Lexus EX 300 about three years ago. The car had 99,000 miles and looked like new. She initially narrowed her search to 10 cars, and eliminated five off the bat when she couldn't get the VIN number from the owners. A few cars she did get the VIN for had been in serious wrecks, so she was able to eliminate those ones early in the game too. The important thing to know is that you're less likely to have auto heartache if you're methodical and have the vehicle vetted by a mechanic and run the VIN number before purchasing. Both Joel and Christa paid cash, so they have no car loan. Meanwhile, Kim -- Clark's producer -- has had a pickup truck for about five years. She bought it on a whim when she wanted to take a road trip and got a zero financing deal. Within days she regretted her purchase -- she actually hates trucks! But she didn't compound her troubles by selling the vehicle and facing steep depreciation. Instead she's hung on to it and turned a not-so-great purchase into a financially viable one.

For years Mercedes Benz vowed that it would never bring its Smart Car to the United States. The luxury carmaker claimed there would be no market for it. But now that people wants smaller and more efficient rides, the Smart Car is set to hit our shores in 2008. The Smart Car is a two-person vehicle that Clark has been obsessed with since he first saw one in Europe. In fact, Clark and his wife have toured the factory in eastern France where these cars are made. Smart Cars were originally designed as a joint venture between Mercedes and the Swatch watch people before the latter company pulled out. A basic Smart Car has a list price of $12,000, but that can rise to $20,000 if you fancy it up. Clark recently had a chance to test drive a Smart Car for a TV story. He's not completely sold on the car yet -- even though he previously put a refundable $99 dollar deposit down. The fuel economy is great (between 40-60 miles around town), but it may be too small for his five-person family. Safety is another concern. The Insurance Institute for Highway Safety doesn't have a crash rating for the Smart Car yet. They think it may be too light to hold up well in a crash. While filming the Smart Car TV story at a Mercedes dealership, Clark couldn't help but notice some of the huge and fancy other vehicles on the floor. There was one Mercedes that cost $202,000. You could sure buy a lot of Smart Cars for that price!

The car market is going through some tough times right now. Sales are the worst they've been since the financial crisis of 1998. Toyota has reported lower sales for three months in a row, especially with their trucks. Ford's sales are down 20 percent over the last month and 14 percent over the whole year. GM is probably doing the best, which in this case means their sales are just on par with last year's figures. Meanwhile, dealers are scrambling because they're overloaded with '07s on their lots and the '08s are already in place. Add all of these factors up and it's clear that consumers are in charge of the car market.

People often ask Clark for a recap of what they should know when buying a new car. First off, get your financing in place before you buy. You'll usually get the lowest rates from a credit union or an online bank. Keep this rule of thumb in mind: If you can't afford a car on a standard 48-month installment plan, you're overbuying. Once you have your financing in place, check out Consumer Reports for recommendations about quality vehicles. Then check prices in the marketplace. Look at CarsDirect.com where you'll get a guaranteed price on a car. You should also test drive the car you want before buying. Visit a car rental business and see if you can rent one for cheap over the weekend. That way you'll have two days to decide if you like driving the car, not just 10 minutes. If you have to interact with a car dealer, try doing it by e-mail to avoid high-pressure sales pitches. And make sure the Internet price you get includes all junk fees like documentation charges.

It's no surprise that we Americans are energy hogs. But everyday there are new developments that help us reduce our energy consumption. Soon auto shoppers will actually be able to believe the gas mileage stickers found on cars in dealer lots! The feds used to put fake numbers on the stickers because the test used to calculate mileage efficiency was bogus. So you could purchase a vehicle expecting to get something like 26 miles/gallon (city) or 38 miles/gallon (highway) and get substantially lower real mileage. Now the government is enforcing a legitimate mileage test, so all cars shipped to dealers after Sept. 1 will have real numbers posted on them. Why the sudden change? The Toyota Prius really pushed this along. People were expecting to get 50-60 miles/gallon but the actual numbers were so much lower that people really ripped off and complained.

Another positive change that's a little further off involves LED (light emitting diode) lighting. Clark and his wife often battle over using regular or CFL (compact fluorescent lamp) bulbs in their home. He has a number of CFLs from the '90s when the technology still had a lot of kinks. In fact, once he was doing a TV story about energy-smart homes and he wanted to demonstrate his lighting for the camera crew. The CFLs took about 70 seconds to come on after he flipped the switch! Today's CFLs are much better (and faster to light up), so his wife is now more open to using them in their home. But CFLs may soon be a thing of the past when LEDs hit the market. LED are now used in new billboards and offer just about the best artificial light possible while eating up low energy. They don't release extra heat and they last for years. LEDs will probably be in offices, retail stores and industrial parks before they're available for home use. Clark thinks within four years LEDs should become a popular consumer product.

For 15 years, Clark has talked about the advantage of keeping a new car for at least 10 years or buying a used car and keeping it for at least four years. Cars lose about half of their value during the first three years, but then the loss ratio drops off pretty steeply after that time. Consumer Reports has now done a study on the virtues of keeping a car for 15 years. Bear in mind that most owners only keep their vehicles for three or maybe five years. But by keeping a car for 15 years or 225,000 miles, you save $31,000 dollars. The report found that during the course of 15 years, your average maintenance will be $18,000 and your insurance will be $18,000.

Consumer Reports also identified 10 vehicles that are reliable enough to last 15 years -- and they’re all Japanese! Among the top ones are Honda’s Civic, CRV and Element; and Toyota’s Forerunner, Landcruiser and Highlander models. So what vehicles should you not buy? A lot of European models, according to Consumer Reports, such as the BMW 7 Series, the Infiniti QX 56 and select models of Jaguar, Mercedes, Volkswagen and Volvo. Meanwhile, how should you decide when it does not make sense to repair a car? Clark typically tells people the cutoff should be when the cost of repair is 50 percent or more of the car’s trade-in value. Now Consumer Reports says you can push that up to the actual trade-in value. Other times you should junk a car is when it’s rusted out; really unreliable, in a flood or in an awful accident.

Over the past five or six years, there's just been one deal after another when it comes to buying an automobile. It goes back to the months after 9/11 when GM tried to jumpstart sales with offers of zero financing for five years. Other automakers quickly followed with similar deals. But now people aren't buying cars as readily because of the fallout from the stock and real estate markets. Overall the industry is having dismal sales results. So that means that you have so much bargaining power right now that it's not even funny. Yet two-thirds of consumers squander that power by not doing the right things.

So what should you be mindful of when you go to buy a car?

First, do research online before you buy. Check Consumer Reports and sites like KelleyBlueBook.com and Edmunds.com to find out about reliable cars that won't need much maintenance.

Second, arrange for financing in advance before you get to the dealership. Credit unions offer interest rates on car loans that can be one to three percent lower than other lenders. You may also want to check online lenders. Even your auto insurer may be able to give you a competitive interest rate. Whatever you do, don't go with a traditional bank or dealer financing. Also, don't tell the dealer you're a cash buyer or credit union customer because they'll factor that into the price in a negative way.

Finally, buy your car before you get to the dealership. By this Clark means you should avoid going to the dealer and negotiating the purchase of your car or you'll face "the grind." The grind is when the salesperson says he or she will go talk to their manager about getting you the best deal. Instead they go watch TV for five minutes and come back and tell you that the manager couldn't help out with a good rate despite their best efforts on your behalf. This is total baloney. When it comes to price, you want to stay in your ballpark, not theirs. After all, they have home field advantage because they sell cars everyday while you may only buy a handful of times over the years.

As a final thought, you may also want to purchase through a warehouse club if you're a member. There you'll enjoy a set price and no haggling.

Have you ever parked at a big event and lost your car? One of Clark's staffers recently told him that she was at a racetrack for a concert and couldn't find her car for a full hour after the event. She eventually located the vehicle when security drove her around to look for it. Similarly, the husband of Clark's executive producer once wandered around an airport parking deck for four hours when he couldn't recall where he parked following a weeklong trip. Imagine if you could avoid these kinds of scenarios in the future. GPS maker Garmin has developed a device that can help: a car finder. Clark recently read about it in The Kansas City Star. It will electronically mark where you leave your car and walk you back to the spot later. This is one device that Clark himself could really use; he fesses up to forgetting where he parks at the radio station about twice a week. And that's after working for only six hours! If you're in the market for a basic GPS, Clark thinks we'll be seeing Black Friday sales in the $99-$129 range. And in a few years, every car will probably come standard with a GPS -- just as mostly every car has a radio.

When you use a car dealer to finance your auto loan, the dealer will mark it up as much as they can. But the average black customer buying a new car pays an interest rate that's 40 percent higher than the average white customer -- even after accounting for differences in credit scores. Hispanics, meanwhile, pay almost the same as non-Hispanic whites, just slightly higher. In the used-car market, one in three blacks pay an interest rate that is above 15 percent, while the average rate for a white person is less than 10 percent. Clark thinks it's a shame that this residual racism is still around in 2007.

If you dig deeper into this story, you'll really find that anyone who doesn't get pre-qualified for a car loan will pay more than they should. So Clark advises anybody seeking an auto loan to get pre-qualified at a credit union, which will offer lower rates than a bank. Think about it like this: You may have spent hours researching your car thoroughly, but you've got to do the same on the loan. Dealers are entitled to make money on a loan if you don't do homework and get pre-qualified elsewhere. Historically, that mark-up had been about 10 percent points. After all the legal settlements of the past few years, however, it now is usually three percent. That means if a bank offers you a car loan for 5 percent, the dealer will offer the same loan for 8 percent. So whether you're black or not, it pays to get pre-qualified for an auto loan.

Clark's daughter has his Honda Civic hybrid at school and she's happy to be getting about 45 miles/gallon. It seems that hybrids with good fuel economy are now selling like gangbusters. Remember back just a few years ago when this wasn't the case? Ford had to offer incentives just to move their Escape hybrids. Now The Washington Post reports the Escape is so hot that dealers can't keep up with the demand. In fact, the vehicles are selling for thousands of dollars above the list price because people want to save money on gas. Psychologically it may feel OK to pay a little more now with the promise of bigger savings down the road, but Clark thinks you should really crunch the numbers before you make this kind of purchase. Buying with your emotions isn't advisable, nor is overpaying for new technology. Take the rational approach by doing some smart comparative auto shopping on a website like Edmunds.com. The same thinking applies when deciding whether to dump your current gas-guzzling ride for a new and more fuel-efficient vehicle. Look for a similarly depreciated vehicle and try to do a trade where you get an older set of wheels that's more fuel-efficient than your current car.

Diesels cars and other vehicles are poised to make a big comeback, according to the latest findings from J.D. Power and Associates. The survey said that one in four Americans would consider buying a diesel car; a year ago, that figure was more like one in 10. Clark remembers the diesel station wagon his family had when he was growing up. That automobile shook like crazy, had terrible acceleration and belched smoke and odor. But today's diesels are not like your daddy's diesel. Clark's driven some modern diesels throughout Europe and enjoyed great acceleration, quiet operation, good gas mileage and less pollution than a regular gas-engine car. So if you're looking for a car next year, diesel could be part of the picture. On a related note, J.D. Power also revealed stats about the reliability of vehicles after three years of ownership. Two brands tied for the top spot: the foreign-made Lexus and, somewhat surprisingly, the American-made Buick. In fact, several other American brands were toward the top of the tally, with Cadillac placing fourth and Mercury placing fifth. Meanwhile, Japanese standards like Honda and Toyota placed fifth and sixth, respectively. On the bottom of the heap were some foreign cars like Suzuki, Isuzu and Saab. But the single least reliable automobile -- based on how many problems were reported per 100 vehicles -- proved to be a Land Rover. Clark thinks it's interesting that some Japanese and European cars were selected as least reliable, while a lot of domestic rides are back on top. But perceptions take a long time to change, and people who grew up on foreign cars sometimes won't even consider a domestic vehicle.

The latest American Customer Satisfaction Index from the University of Michigan has been released. This quarterly survey has been around since 1994 and keeps tabs on the good, the bad and the ugly in multiple industries. The big news this year is that American automakers did very well. While the top automaker was foreign (Toyota's Lexus division), homegrown companies like Cadillac, Buick and Lincoln-Mercury all tied for second place. Meanwhile, Toyota's namesake division fell way behind on the tally. Clark thinks the Japanese automaker has been taking its eye off the ball lately. The Toyota business model is now geared toward growth and quantity, not quality. That accounts for why they've been issuing more recalls than ever. Fortunately for Toyota, there are some corporate initiatives in Japan to raise the quality of their namesake line of vehicles. In the computer industry, Apple is tops in customer satisfaction; Clark's wife has an Apple Macintosh that she loves. In the PC world, Hewlett Packard's HP line makes a beloved machine, yet HP's Compaq division has been voted the worst company in the industry. Meanwhile, Whirlpool continues its dominance in the appliances field, racking up its largest lead yet over the competition.

Clark frequently fields one question from the public when he's on the road during his book tours: "When is it right for me to lease a vehicle?" With the leasing market up about 25 percent year over year, it's a great time to address this question again. There are two circumstances when doing a lease is acceptable: The first is if you like new wheels all the time and you only want to worry about gas, oil changes and routine maintenance on your vehicle. Then it's OK to lease a new car every two or three years, but no longer than that. The second instance is when luxury automakers offer factory-subsidized leases where they eat a lot of the cost. Luxury automakers hate to cheapen their brands with a bona fide sale, so often they offer such leases to help move extra product. But other than in these two circumstances, don't lease. And stay away from four or five year leases unless you want to face financial Armageddon, Clark says.

Meanwhile, the strong growth in leases means that in a few years there will be great deals on two and three year old cars when they enter the used auto market. Clark is a big fan of used cars, but be aware that you must always have them inspected by an independent mechanic before you buy. Finally, beware of one cousin of the long-term lease -- the balloon loan. This is the kind that starts with an extra cheap monthly payment, but at the end of five or six years you may owe the lender up to $10,000 or even $15,000. And by then, your vehicle's worth won't be able to keep up with that inflated balloon rate.

The Chinese have come into almost every American market except for cars—until now! Starting in 2008, Chinese cars will be sold under the Chrysler name in the U.S. Mainland China has a goal to account for 10% of cars sold in the world. But quality is a huge issue with Chinese manufacturing. Hyundai started off with terrible products at first; China might too! China makes terrible toys, dog food, tires, and much more, because there aren't sufficient checks and balances in the manufacturing system. So it will be a challenge for them to get the quality right. But they'd better, because the quality of cars these days is top drawer. Cars are better, safer and more reliable than they have ever been, so it's a great time to buy.

Ford is working with the power companies in California for plug-in hybrids, which are electric-powered for the first 40 miles, after which the car switches to gas. These are awesome! They cost only 2 cents per mile, only a fraction of what you pay per mile for gas! And it's a great way to reduce our dependence on foreign oil.

While the big oil companies are the ones ripping us off, it's your local gas station that gets the heat from consumers. But did you know that gas stations actually like it when the price of gas is lower? When prices get too high, people tend to buy less of the expensive convenience store goods like beer, cigarettes and lottery tickets that are profit boosters for gas stations.

No matter how you look at it, fuel is just one cost associated with a car. If you were paying to ride in your car the same way you pay to ride in a taxi, you'd be spending some 50 cents a mile. But what if you could drive for as little as two cents a mile? There are a number of smaller companies such as Kurrent making electric cars offering that kind of fuel economy. Kurrent -- which was bankrolled by ad-agency people using their retirement funds -- makes an electric vehicle that will go up to 35 miles an hour with a 100-mile range on flat ground. You can charge the vehicle in an ordinary household outlet. And though it is very small, it's built strong enough to be substantial in a crash. They're making up to 10 of these cars a day. The primary market is in large retirement communities in Florida, California and the mountain states. But if you think you're too cool for a grandpa-mobile, just ponder these economics: In addition to running for just two pennies a mile, a Kurrent costs as little as $10,000 to buy. Now that's a Clark Car if ever there was one! Clark has been fixated on great fuel economy since the oil shortages of the '70s. As he says, we are the strongest nation on Earth, but we won't always be if continue to give our money to oil-producing nations that want to destroy us. We must be innovative as Americans, and going electric with your car is one way to do it.

The market for gas-guzzling vehicles is awful! Car companies like Chrysler and GM are trying 0% financing with rebates to try and pull consumers back in. You can get incentives on some vehicles, others will give you 0% financing, and some deals will give you both! Each company has a “summer drive,” so that they will advertise better deals for SUVs and trucks to make up for their high gas consumption. However, if you're thinking of buying an SUV but don't plan to own it for the life of the car, keep in mind that it is very tough right now to get rid of a used SUV. Practicality is now beating out style.

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About 18 months ago, Clark issued a warning on the show about the damaged cars from Katrina and Rita that would soon be flooding the market – no pun intended. Well, it’s happening. Con artists are selling “flood cars” from Texas, Mississippi, Alabama and other states that were affected by the hurricanes. Several auto insurers are refusing to crush these cars because they knew it would make them more money. So, because of weak title laws in most states, criminals have been “washing” the titles of these cars and putting them back on the market as if they’d never been involved in a flood. Close to half a million may be on dealer lots today. Washing the title basically means a title that would have had “SALVAGE” written on it is given a clean title with very little effort because the laws are so slack. So, it’s more important than ever to have a used car inspected by a certified mechanic. Before you buy a car, make sure you have it checked out. Clark thinks all of these cars should be crushed and never sold again.

The sale of small, fuel efficient cars has grown in the past few years and will continue to do so. People who have been hit by the gas increases of recent years are making people reconsider what cars they buy. As a result, GM is jumping on the bandwagon. GM is about to introduce car that is smaller than Honda’s Fit and Toyota’s Yaris. It has a 1-liter engine and will get about 40 miles per gallon. These cars start at about $10,000, which is very affordable. The average car sold in the States is about $25,000. The trade-off is that they are not as safe in an accident. So, you must be careful driving them.

We are in a difficult spot in the automobile industry right now. The three American automakers – GM, Ford and Chrysler – are struggling to sell cars. At the same time, dealers have tons of cars on their lots that aren’t selling. Dealers have what are called “flooring plans,” which means they pay another company to put cars on lots. And, there are liens on the entire inventory. Every day that a car is sitting on a lot, the dealer is paying for it. So, flooring costs are going up at the same time interest rates are going up. As a result, dealers are making all kinds of deals. If you check out Edmunds.com, you can see the “true market value” of a car. It gives you a target of what you should pay. Warehouse clubs and credit unions have car buying programs, as well. The car market does not have deals on fuel efficient cars, however. These days, people want cars that get 30 miles to the gallon or more, so getting a deal on those kinds of cars is tough. But you can get great deals. You can even go to carsdirect.com, where someone will help you buy the car you want for the price you want. Consider traveling if you’re going to buy a car. Prices vary quite by region. You can save as much as $2,500 depending on where you buy.

New, clean burning diesel cars are coming our way. That probably seems impossible to people who owned or rode in diesels back in the 70s or 80s. But the new “clean diesel” is coming to the States very soon. They’ve been around Europe for years, and they get about 30 to 40 percent better fuel efficiency than gas cars. Volkswagen already sells diesels in the States, but more companies are getting in the business. It’s imperative that Americans drive more fuel efficient cars. It helps our wallets and ensures our national security because we’re not as dependent on foreign energy and oil. To remain the world power that we are, we need to stop doing business with countries that want to harm us.

Asian cars are selling like hotcakes these days. In fact, Asian automakers are now selling 40 percent of the cars sold in the U.S. Meanwhile, Detroit and the American automakers can’t give their products away. The Honda Fit is selling so well that people follow the trucks carrying these cars into the dealerships so they can get one. There’s no mystery as to why. The huge gas guzzlers out there are draining people in the wallet. It costs an average of $40 to $60 to fill up cars these days. Clark’s scooter, on the other hand, costs $2.94 to fill up. Now, you don’t want to dump the car you have just because it guzzles so much gas. You want to wait until the car you own has run its course. Although its seems like buying a new, more fuel efficient car would be the smart choice, it would actually be more costly because of all the extras and overhead.

The motor home business is growing by leaps and bounds these days. People seem to love the idea of having their home wherever they go. But recreational vehicles can cost quarter of a million dollars, and they’re not always reliable. Buying an RV is not like buying a car or truck, where there is mass production and lemon laws to protect you. If some kind of law does exist it’s only on the power train of the vehicle. When you buy an RV, you’re kind of on your own. There are even attorneys that specialize in RV issues because so many are coming up. Because there is so much risk involved, you need to buy an RV from a reputable dealer. Clark also recommends renting an RV and traveling around in one for awhile before buying. You may think it’s your dream, but you may turn out to hate it. Also, people seem to have better luck with the RVs you tow instead of the ones that have motors in them. So, be cautious before you take the plunge.

Clark rides a scooter to work nearly every day and it’s costing him almost nothing to commute. He loves the gas mileage it gets and the ability to park it wherever he is. He’s not the only one apparently. Sales of scooters are up 65 percent in the past year. In comparison, bicycle sales are up in single digits and motorcycle sales are up by even less. But scooters are growing in popularity by leaps and bounds. For some people, it’s not convenient or practical. But if you can, you’ll make up for the cost in a very short time. Clark estimates that he’ll make up the cost at 3,800 miles. Every mile after that will be like driving for free!

Clark has been riding his scooter to and from work every day for a week. He lives about 5.5 miles from work and he uses about a quarter of a tank a week. The scooter gets about 75 miles to the gallon, so gas has become irrelevant to him. Or, at least for this week. Granted, most people can’t take a scooter to work. But what if cars could get 75 miles per gallon? It’s not a pipe dream. The U.S. Congress is moving closer to imposing new fuel economy standards on automakers in Detroit, and it’s the start of some much-needed change in the oil industry. The average American vehicle gets about 27.5 miles to the gallon today. We can do much better than that. The technology is already in place, and there is no excuse for our lack of focus as a country. Detroit will claim it can’t do this but that’s simply not true. You can do your part by purchasing something more fuel efficient when it’s time to buy a car.

Clark has great news for you if you’ve been hit by new car fever! Spring is usually the time of year that car dealers shine. But this year is not syncing with that trend. GM and Ford have both suffered a 20 percent drop in car sales. Chrysler is down 15 percent. And Toyota and Lexus are down 10 percent. Overall, the auto industry is down 13 percent. So, in a time when supply and demand favor the dealer, it’s now the opposite. Car buyers are now in the driver’s seat. The one exception is BMW, which is doing quite well compared to a year ago. So, what do you need to do? First and foremost, get the loan first. This is especially true for new cars. Go to your credit union or bank (if you have to) and get pre-approved for a loan that is no longer than 48 months. Secondly, look at Consumer Reports’ April issue. That issue gives you the most reliable cars at various price ranges. Then, consider becoming a member of a warehouse club and get involved in their car-buying programs. Dealers clamor to be warehouse club dealers, so there are set prices that you want to know. It’s a no-negotiation way of buying a car. Also, look at carsdirect.com to compare car prices so you know what you should pay going in. once you have all your ducks in a row, go test drive some cars. Just make sure you don’t buy a car right away. Shop around and get quotes from various dealerships. When you have the price you want, take delivery!

Buying a new car can be a pretty miserable, frustrating experience. But there have been some improvements in the process. One of those was the start of a company called CarMax, which originated in Richmond, Virginia. Carmax researched what people dislike about the car business. One of the main issues was “the grind,” where salespeople claim to have to talk to their managers and try to wear you down by taking their time. People also hate the pressure on the sale and the inability to return the car. CarMax changed all that, and the company even offers a warranty on a used car. Forbes magazine recently described CarMax as “a fantastic business.” The company has been adding stores all over the country and is up to 19 states. The company makes $600 billion a year. In the past year, sales are up 18 percent and profit is up 30 percent. Even better for the company, people are willing to pay more for CarMax cars to avoid getting the runaround. You would think other dealerships would do what CarMax does if they could make more money. But apparently not. One thing you don’t want to do is finance a car there, even though it’s convenient. Arrange financing ahead of time and you’ll get a better deal. And always have a certified mechanic check out the vehicle first.

New little cars are coming into the market and you’re going to like what they can do. Honda, Toyota and Nissan all have new “smart” models in production, and all get about 40 miles per gallon. American automakers are years away from getting into this market, so they’re shaking in their boots. These cars won’t be very pretty, but they will seat four people and get you around town in a jiffy. Nissan is offering the “Versa,” which gets 38 mpg and costs between $12,000 and $15,000. Honda’s model is the “Fit,” which gets about 35 mpg and costs $13,000. The Toyota “Yaris” gets 37 mpg and starts at $11,500. Keep an eye out for them all!

Ford Motor Company has gotten lots of coverage lately, as the company tries to salvage itself. About 30,000 people lost their jobs and more than a dozen plants have closed. Wall Street puts the odds that Ford will file for bankruptcy at a little better than one in four. GM is looking at a little less than half. So, the two big remaining auto makers face a fight for survival. Koreans, Germans and Japanese all have plants in the U.S. now and foreign auto makers have been buying up auto centers left and right. We as Americans have the ability to do great work and build great products. The truth is that workers benefit or suffer based on the quality of management in the company. And that is where we need to start if we want to overcome and succeed again in the auto industry.

GM, which owns Pontiac, Buick, Cadillac, GMC and others, is in a tough spot right now. The company has temporarily shut down assembly lines around the country and there are rumors that GM is about to file for bankruptcy. On top of that, GM is having a very difficult time selling cars. GM has discovered that it can only sell cars when the company offers huge discounts. So, GM is now back at it and has launched a new sale known as the “Red Tag Sale.” So, when you go to a dealership, you’ll see the Monroney label on the car and, next to it, a “red tag” price. This is the no negotiation, maximum price, so the car can’t be sold any higher than that price. Then, if you’re a savvy shopper, you’ll be able to negotiate below that price.

Clark has talked with great enthusiasm about the “Smart Car” coming to the U.S. The Smart Car is a Mercedes-Swatch idea that is from Europe and is being sold in Canada. The cars average 60 miles for gallon and many have wanted them to come to the U.S. It’s not going to happen, but all is not lost. Zap, the company that was going to sell the Smart Car in the U.S., is now bringing another car into the States. It’s from Brazil and it can run on various types of fuel, including corn, sugar, gasoline and other sources. It’s called the Obvio 828. It’s one of the oddest looking cars you’ve ever seen and it goes 0 to 60 in about five seconds. The Obvio takes up as much space as a motorcycle, but it can seat three people. Prices on these will ultimately be decided, but we’ll keep you posted. In other car news, Mazda is bringing a micro mini-van into the States that seats six people. It gets about 50 percent more fuel economy than a regular mini-van. Clark is psyched about the options coming our way because they get such better fuel economy and reduce our dependence on foreign sources of oil.

Honda has had a reputation as the best engine maker in the world. But Toyota has now one-upped everyone with its hybrid engines. As a result, Honda has been working overtime to recapture its innovative lead. The company has secretly been working on a gas engine that gets 65 miles per gallon of gasoline. It’s a regular car with an HCCI engine. That translates into “Homogeneous Charge Compression Ignition” but what it means is that it allows a gas engine car to run as efficiently as a diesel engine. These cars won’t be out next year, but it will be in the next five years. Companies have the ability to cut fuel consumption in half. Many just haven’t tried. So, there are good things happening, including in the United States. But we need to continue on this path and continue separating ourselves from foreign oil sources. If you read the quotes of the Iranian president in recent weeks, you’ll realize how important it is that we assert our independence in the oil world.

We are paying the highest gas prices we’ve ever paid and, as a country, we need to get serious about how much energy we’re using as a country. Yet, the automakers have twisted the arm of the Bush administration to come up with wimpy mileage standards for their vehicles. It’s all in an effort to protect GM, Ford and Chrysler. But these “rules” are doing no favors for the American auto industry or for consumers. The administration did nothing about how much fuel these vehicles burn, which is the real issue here. Instead of figuring out how to get the government to give them a free pass, auto makers in Detroit should building vehicles that get better fuel economy. People want cars that are more fuel efficient these days. That’s why so many people are buying scooters these days.

Clark owned a 1987 Acura Integra, and he’s glad he sold it awhile ago. That’s because the Acura Integra is the most popular car to steal these days, according to insurance industry reports. Apparently, people like to race them legally and illegally, so Integras are very hot cars to steal and soup up. On the list were the 1999, 1998, 1996, 1997 and 1995 Acura Integra. The second most popular vehicle to steal is the 2002 BMW Roadster and fourth car on the list was the GMC V-2500. The 2002 Audi S4 was also on the list. But the majority of cars are various years of Acura Integras. If you have one and you want to hold onto it, be careful.

These days, more people want small cars or “mini” cars because gas is costing them so much money these days. Clark has a Scion XB that gets great fuel mileage and has tremendous room on the inside. He admits the car is very ugly, but he spends the majority of his time inside and does not really care about the outside appearance. You are going to see a lot uglier, mini cars in the next 18 months. Car companies believe there will be a lasting market of people looking for fuel efficient vehicles, meaning the car gets over 30 miles a gallon.

There is a lawsuit pending against Ford Motor Company, which alleges that the company has been overcharging and cheating black customers at certain Ford, Jaguar, Mazda and Land Rover dealerships. There are always undisclosed mark-ups in the loans dealers give you when you do financing at the dealership. It’s typically about 2 to 2.5 percent higher than the offer they get from the actual lender. But Vanderbilt University found that black customers were charged $862 more for a loan, while white customers had only a $475 mark-up . Vanderbilt also found that blacks were uncharged two-thirds of the time, while whites were charged more one-fourth of the time. Ford claims that it had no idea this was going on. But it did happen. Avoid mark-ups all together by financing with your bank or credit union instead of the dealership. You can’t get taken if you don’t do business with these people. If you think the car dealership can beat the offer you get from your credit union, offer it up. Maybe the dealership can beat it. But make sure you have an offer when you go in. Never conduct business the other way around.

Clark talked recently about cars from China that would soon be available in the United States. He predicted that it would be about a year from now when they would make it here. But that has changed. It will probably be early 2007 when the new Chinese cars make it to the States. But the price of these cars will start at $6,995, which is fabulous. They will also come with 10-year warranty, according to the Detroit News. The Chinese are doing that to instill confidence in buyers, so we’ll see if it works. The cars will also cause additional pricing pressure in the market, which is always a good thing for consumers.

A while back, Clark talked about a law suit against Ford motor company, which was allegedly discriminating against black customers. Ford was accused to charging black customers more to finance a car. The company chose to fight the allegations and lost the case. So, Ford now has to set up a procedure that it is not cheating black customers anymore. And it’s not just Ford. Many companies have had to settle in court over this issue, but most people out there don’t know anything about it. Clark first learned about this back in 1999 when a disgruntled finance worker sent Clark some documents showing huge loan mark-ups for black customers. The whistle blower told Clark that when someone didn’t know his or her credit score, the dealership marks up the loan as much as 15 points. The typical mark-up is 3 to 5 points. Let’s hope that era of dealers marking up loans is over, as people become smarter and mark-ups are capped at a certain amount. If you haven’t joined a credit union yet, the time to do it is before you buy a car. Credit unions offer much better rates and you won’t have to deal with the possibility of finance mark-ups.

Consumers have an amazement with transportation these days. Because of all the technology out there, vehicles are becoming almost like a second home to us. Land Rover is no exception. The car company is building a vehicle that has a built-in “Wi-Fi” system that will allow people to surf the Web while they drive. OK, let’s hope the driver isn’t the one on the Web. But you will have your own Internet café in your SUV. And, anywhere there is a Wi-Fi hotspot, your car’s computer will connect to the Internet. What will they think of next?

There is a lawsuit pending against Ford Motor Company, which alleges that the company has been overcharging and cheating black customers at certain Ford, Jaguar, Mazda and Land Rover dealerships. There are always undisclosed mark-ups in the loans dealers give you when you do financing at the dealership. It’s typically about 2 to 2.5 percent higher than the offer they get from the actual lender. But Vanderbilt University found that black customers were charged $862 more for a loan, while white customers had only a $475 mark-up. Vanderbilt also found that blacks were uncharged two-thirds of the time, while whites were charged more one-fourth of the time. Ford claims that it had no idea this was going on. But it did happen. Avoid mark-ups all together by financing with your bank or credit union instead of the dealership. You can’t get taken if you don’t do business with these people. If you think the car dealership can beat the offer you get from your credit union, offer it up. Maybe the dealership can beat it. But make sure you have an offer when you go in. Never conduct business the other way around.

Clark talked recently about cars from China that would soon be available in the United States. He predicted that it would be about a year from now when they would make it here. But that has changed. It will probably be early 2007 when the new Chinese cars make it to the States. But the price of these cars will start at $6,995, which is fabulous. They will also come with 10-year warranty, according to the Detroit News. The Chinese are doing that to instill confidence in buyers, so we’ll see if it works. The cars will also cause additional pricing pressure in the market, which is always a good thing for consumers.

GM used to be dominant in the American car market, but now the company only has about one-quarter of the American made cars on the road. GM has 1.25 million new cars that they have not been able to sell. The only thing GM can do to try to sell these cars is offer customers deal after deal. They are now offering a deal that says if you own a GM, they will let you buy a new GM and they will give you $1500 off. This just goes to show how much control the consumer has in the car market.

Luxury carmakers and designers are feeling a need to lower their price points in an effort to make more money. Mercedes and BMW, for example, are trying to create entry-level vehicles because other companies have made a fortune off of these cars. The Japanese were the first on board with this trend, building the entry level Infiniti, Lexus and Acura. They were coined as “near luxury” cars and . Now, Mercedes has a car that starts in the 20K range. The average price of a car today is about $25,000. So, people are very excited about getting into a luxury label car for just a few thousand dollars more. Clothes designers are also starting to create entry-level brands. Target, for example, sells Isaac Mizrahi, a couture designer, at bottom basement prices. It’s hot, but Clark wonders if it devalues the brand when a designer starts offering entry level “designer” clothes for much less money and discount stores.

GM used to be dominant in the American car market, but now the company only has about one-quarter of the American made cars on the road. GM has 1.25 million new cars that they have not been able to sell. The only thing GM can do to try to sell these cars is offer customers deal after deal. They are now offering a deal that says if you own a GM, they will let you buy a new GM and they will give you $1500 off. This just goes to show how much control the consumer has in the car market.

Clark has a fascination with tiny automobiles. He was an investor in a Minneapolis car company that manufactured 3-wheel cars, and he had one of the cars himself for many years. There are more of these “mini” cars coming on the market. In India, for example, a company is making a $2,000 mini car that is based on a modified motorcycle platform. It will get fantastic fuel economy and cost only a couple thousand dollars. In Europe, people in large numbers are buying tiny Micro Cars that routinely get about 70 miles to the gallon. Several of these companies are prepared to bring these cars to the United States, according to NewsDay. Automakers have no idea what the demand will be for these cars, but they will get about 70 miles to the gallon. If you get hit or are in an accident driving one of these cars, there could be some severe damage. But Clark will definitely buy one when they get to the U.S. because the benefit to the country will be so great.

Clark has a Honda Civic Hybrid and he loves it. It’s not as hot as the Prius, the hybrid for which people are bidding on eBay. Clark thinks that’s because it looks so futuristic. People like the different look it has, and Clark’s Civic frankly looks pretty plain. There is also a trend of “vegan” car owners. If they own a hybrid, they don’t want leather seats or any kind of animal-related products in the car. So, automakers are designing cars with the environmentally-conscious in mind.

A long time ago, Clark was involved with a Minnesota-based company that made a three-wheel car known as the “Freeway.” It was designed to get 100 miles to the gallon and would go up to 75 mph. It was an interesting car because it didn’t have reverse and was basically very quirky looking. Clark loved his Freeway and drove it everywhere. Eventually the company shut down, but apparently the concept lives on. Once a year colleges and universities compete in an national engineering contest called the “Super Mileage Competition.” The objective is to build cars that get great gas mileage, and the car with the best fuel economy wins. The students who won built a car that got more than 1,700 miles to the gallon. They were from Canada and have become the talk of the country. Some students from Cal Tech came close with a car that got about 1,600 miles to the gallon. It’s incredible, but also obviously very feasible. Yet American companies claim they can’t increase the mileage cars get. Maybe some of the automakers in Detroit need to take a page from the book of these students to improve their cars.

You’ve probably heard of hybrid cars. They have two engines - gas and electric - and they alternate between both. When Clark bought his first hybrid, it cost a little more because it was such a new concept. Well, now the same thing is happening with the Toyota Prius. Dealers are charging way above list price and there are very long wait lists to get these cars. People are even bidding on eBay to move up in line on the waiting lists. People buy these cars to save money on fuel. But they’re spending so much money on these cars that they won’t ever make up the difference in fuel savings. The Prius averages about 40 to 50 miles to the gallon, so that is a deal. There are also a number of other hybrid vehicles coming into the market including the Honda Accord hybrid, the Ford Escapes hybrid and the Lexus SUV hybrid. That one could cost you $50,0000. So you’ll have to buy tons of fuel before that makes sense. You don’t want to dump your current car for a hybrid if it runs fine. But if you need to replace a dying car, buying a car that gets better fuel economy is smart.

The sale of SUVs is pretty low right now, and automakers are singing the blues. Because of high gas prices, people are choosing not to buy. It’s changing the mix of what people are interested in. But if you’ve had your heart set on an SUV, now is the time to buy. The overall SUV inventory is more than 20 percent above what dealers consider ideal. Automakers are cutting the production of SUVs and many vehicles are what are known as a “100-day supply.” Automakers want a 60-day supply, which means that as soon as cars get from the manufacturer to the dealership the cars are sold. Every day after 60 is too many, and breaking 100 means there are tons too many in supply. Car dealerships don’t have the money to keep vehicles on its lots for too long, so they will be offering discounts to get rid of them. Dealerships may also throw money at you to buy an SUV. But just remember that gas can cost a bundle.

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In other car news, about one-third of people are upside down in vehicles as much as $4,000. People are taking out longer loans, and they’re buying new vehicles before they’re done paying off the old loans. Long term, this is going to cause you a lot of financial pain. If you get bored with a car, don’t bail on it. Keep driving it and you’ll be better off in the future.

Clark likes to drive ultra high fuel economy cars for several reasons. The cars get great gas mileage and they put out almost no air pollution. He’s driven one kind or another of these cars for the past four years, and he loves them. Apparently, he’s not the only one. Toyota’s hybrid, the Prius, is now has the hottest selling car in the United States. The company has increased the price of the car because it’s in such high demand. And Ford is now getting into the hybrid game. Economists at Ford think the gasoline price crisis is going to last for a while, so the company will soon release three different vehicles. One of them will be an SUV, and it will come out later in the year. Lexus, the high-end Toyota product, will also release a hybrid SUV later in the year. As more production occurs, the cost of making each unit goes down and these cars will become more mainstream. So, if you’re feeling it from the gas price increase, don’t react emotionally and dump your current vehicle. But when your car has run its natural course, you may want to consider a hybrid. Volkswagen has also had great success with diesel cars. The cars get gas mileage in the mid 40's, and they burn much cleaner fuel than older diesels. So, you have several options out there to save gas money.

In our show meeting today, we talked about minivans. According to USA Today, some thirtysomethings associate minivans with family-oriented vehicles that only mothers and senior citizens drive. But some car companies are trying to get us to overcome the “uncool” stigma. And according to the story, mini-van sales are climbing quite nicely. There are even some on the market that are considered very hip. One is the Nissan Quest. What do you think?