Senate reaches deal to extend ‘Cash for Clunkers’ program

August 6, 2009

(ChattahBox) — After lengthy negotiations, the Senate reached a deal late Wednesday, agreeing to vote on a plan today, that would infuse $2 billion into the program known as the Car Allowance Rebate System (CARS), but coined ‘Cash for Clunkers’ rebate program that awards car buyers up to $4,500 for trading in older gas-guzzlers for more fuel-efficient rides. Officials estimate the additional monies could fund an additional 500,000 vehicle sales and last until Labor Day. The agreement couldn’t have come soon enough President Obama said, If not replenished by Congress, the program would have gone broke by Friday. The House approved the $2 billion extension last Friday.

As of Wednesday, transportation officials estimate, more than $775 million of the $1 billion fund had been spent, accounting for nearly 300,000 new vehicles, since the program started July 24th. Dealers get reimbursed for the credits by the National Highway Traffic Safety Administration, which is operating the program. The amount of the credit depends on the level of gas-mileage improvement. A gain of 4 to 9 miles per gallon earns a $3,500 credit, and one of 10 miles per gallon or more earns a $4,500 credit.

Overall, General Motors, Ford and Chrysler have accounted for about 47% of the 157,000 new vehicles sold under the clunkers program. That figure is a little deceptive in that of the top 4 foreign cars on the list, only the Prius is built exclusively in Japan, while on the other side of the spectrum, 95% of Honda Civic’s sold in the states are built in Indiana or Ontario, Canada, and all of the engines are made in the U.S.


Comments

One Response to “Senate reaches deal to extend ‘Cash for Clunkers’ program”

  1. Billy Samford on August 6th, 2009 4:25 pm

    About time, now if they can just change it so it only allowed American car companies to benefit from it, we’ll be solid.

    It may sound a bit protectionist, but their direct investments in these car companies has me mildly concerned and I believe this would help, directly.

    Investing in ourselves, what a concept? : )

    Billy

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