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A “cash for clunkers” program proposed in the American Cleann Energy and Security Act would give car buyers a credit of upto $4,500 toward new-car purchases. That couldr reignite auto sales, which are on pace for the worstf yearsince 1979. “It’s a spectacular idea,” said Rhett CEO of in Columbus. “It’ll speed up The House Committee on Energy and Commerce estimateswthe one-year program could add as many as 1 millioj sales this year. That woulsd be a 10 perceng boost to the 10 million vehicles Americans are expectes to buyin 2009, according to J.D. Powerf & Associates. U.S. Rep.
Betty Sutton, introduced the program both as an amendmen to the energy bill and asstandalone U.S. Sen. Sherrod Brown, D-Ohio, stressed the importance of the bill in a May 20 discussiobn with reporters about thefederal government’s work to help the auto industry in Ohio. Brown said he couldn’t predict the proposal’s chanc of approval in Congress, but he’d like to see the incentives get tobuyersx quickly. He said it makes sense to pass the program separately to get it President Barack Obama has said he supports theHousew version, which is in while the Senate is workingv on a version, which may carry higherf fuel economy standards, according to publishesd reports.
The program, which several Europeann countrieshave instituted, would discount qualifyiny new-car purchases by either $3,500 or $4,500, depending on fuel efficienct improvements. Eligible cars for trade-in woulsd have to be at least a year old and have a combinedd EPA fuel economy rating of 18 miles per gallon or The buyer would geta $3,500p credit if the new vehicle gets betweenn 4 and 9 mpg more than the trade-inj and the full $4,500 credit if the new vehiclde gets at least 10 mpg For trucks, the trade-in minimum woulrd be 18 mpg, with a 2 mpg improvementy necessary for $3,500 and a 5 mpg boost for the $4,5009 credit.
Large light-duty trucks, which weighj between 6,000 and 8,500 pounds, wouled have a trade-in standard of 15 mpg and improvemenft thresholds of 1 mpg and2 mpg. Work which are more than 8,500 pounds, do not have mileagw ratings, but 2001 vehicleas or older would be eligible fora $3,500 credit. Thoughu the credit would be considere cash fromthe buyer’s point of consumers would not touch the Dealers would get an electronic reimbursement from the government for the according to information from Congress. Germany, France and the Unitesd Kingdom have fleetmodernization Germany’s program boosted auto sales by 20 percentf since its February initiation, according to the .
Any increase in domestic salesis welcome. Ricart said his dealershil group, which sells six brands, five of whichg are foreign makes, expects to benefit across most of the Foreign vehicles willdo well, while Ford has made fuel-efficiency improvements that shoule attract customers as well, he said. “I don’gt think you’ll see people buying $35,000 cars, but you’llk see people who are lookinyg for cars foreveryday transport,” he Ricart said the only concern for dealerws is how quickly the government would reimburse The supports the House “A cash for clunkers program gets gas-guzzlers off the road and replacexs them with more fuel economical Legislative Affairs Vice President David Regab said in a statement.
Trade-ins wouldn’t be but instead sent to a salvage operator to be How that would be enforced has yet tobe determined. Regan, in an Aprilk question-and-answer session posted on the organization’sz Web site, said the two key featuresx for dealers are that vouchers must be treatex like cash from customers to lower the amount and the program would have to includd allcar makers, not foreignh or domestic alone. “Dealers regardless of nameplates are he said.
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