As car shoppers rave about $4,500 cash-for-clunkers rebates, dealers revel in sales spikes, and automakers like GM start re-hiring to meet demand, Sandy Blalock just wonders how she’ll handle the 20 jalopies with defunct engines coming to her auto-recycling facility from two local dealerships.

“I don’t foresee making a lot on these vehicles,” says Blalock, president of Capo’s Truck and Auto Parts in Albuquerque, New Mexico. It typically costs her full-service facility, which sells salvaged parts exclusively to body and mechanic shops, between $1,200 and $1,500 to process a vehicle, remove toxic materials, pull off parts for resale, and store the stripped hull on her 10-acre facility for up to 36 months.

Self-service salvage companies that let consumers wander the lot and harvest their own parts might not have overhead as high as Blalock’s, but some are still concerned about the flood of “clunkers” from car dealers triggered by the Consumer Assistance to Recycle and Save Act (CARS). The main reason is that their engines will be useless by the time they arrive, as dictated by the Department of Transportation.

Every gas-guzzler that consumers trade for a rebate toward the purchase of a new, more fuel-efficient vehicle must have its engine destroyed at the dealership. And there’s a specific way it must be done: Replace the oil with a liquid-glass solution called sodium silicate, then run the engine until it seizes.

It’s the DOT’s way of ensuring that the engines don’t make it back on the road. And so the cars’ steel carcasses don’t get back into circulation either, the DOT requires that they be crushed after six months.

Both measures have unfortunate consequences for auto recyclers. Crushing the engine renders useless the most profitable part of a salvaged vehicle, worth up to 30 percent of a car’s overall value at the end of its life; and sending the cars to the compacter after six months significantly shrinks the window of opportunity to monetize parts from vehicles.

Both rules are environmentally counterproductive, because they mandate the scrapping of parts that could have otherwise been reused to offset energy and raw materials required to produce new ones.

What’s worse, destroying a clunker’s engine could make an entire vehicle not worth messing with, says Michael Wilson, president of the Automotive Recyclers Association, because a recycler might already have the 10 or 20 parts it would have taken from the car when removing the engine. “So those vehicles may…just go right to a scrap processor,” he says.

That fate awaits the scores of clunkers piling up at Paragon Honda in Woodside, New York. “Paragon is like a machine,” says Anthony Ambrosio of A&J Scrap Metal in Jamaica, New York. “I haven’t seen a dealer yet that produces the volume of clunkers that they do. You pick up 10 from there, there’s 20 left. You pick up 20, there’s 30 left. They just pump them out.”

Ambrosio’s company crushes cars as soon as they’ve been stripped and drained of hazardous materials. After that, they’re sent to a shredder and reduced to small chunks of metal to be sold on the commodities market.

So far, Paragon has taken 150 clunkers in exchange for new cars. On average they get 14.6 miles per gallon. Cars must get 18 miles per gallon or less to be considered for a rebate. (Visit www.cars.gov/faq for a complete list of rules.) The new Hondas that customers bought get 27 miles per gallon on average—which is considerably more than the minimum 4-miles-per-gallon improvement the program requires.