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Cash for Clunkers Bill Moves Ahead

The White House and the House Energy and Commerce Committee reached an agreement on proposed legislation, which now moves to the full House for consideration.

“Cash for Clunkers” legislation has gained traction on Capitol Hill as competing bills in the House have been consolidated and moved out of committee. The White House and the House Energy and Commerce Committee reached an agreement on proposed legislation, which now moves to the full House for consideration.

"'Cash for clunkers' is a common-sense proposal that will help provide a shot in the arm for the American auto industry at a crucial time for our economy, reduce the emissions that cause climate change, and make America more energy independent,” said House Speaker Nancy Pelosi. “By helping Americans trade in their old, less fuel efficient cars and trucks for newer, higher mileage vehicles, consumers will save money at the pump, help protect our planet, and create and save jobs for American autoworkers.”

Numerous automotive aftermarket associations including AASA, AAIA, CAWA, CARE, SEMA and others, have expressed opposition to the plan. SEMA yesterday issued a statement expressing its disappointment in the measure.

"The Specialty Equipment Market Association (SEMA) is disappointed that today lawmakers and the Administration have taken another step toward establishing a national “Cash for Clunkers” program. SEMA recognizes the urgent need to direct economic stimulus towards automakers and dealerships, and protect the environment. SEMA has consistently supported the concept of government–issued vouchers and other incentives to purchase new, fuel-efficient cars as a mechanism to achieve that goal. With a program that includes scrapping cars and trucks, Congress is simply taking the wrong approach.

"SEMA will continue to work with lawmakers to find ways to minimize the harm a motor vehicle scrappage program will needlessly impose on thousands of independent repair shops, auto restorers, customizers and their customers across the country. SEMA will promote instead a government incentive program that will help clean the environment, provide for vehicle and parts recycling, and preserve collector cars for future generations.
 
"We are in contact with Congressional offices working toward that goal now. Automakers and dealers need to sell cars in order to survive, but potential buyers have hit the brakes in these tough economic times. Scrappage programs actually would deny vouchers to the majority of people who may want to buy a new car but don’t have an eligible older car to trade. Instead, these programs will be misused by those who own two or three older cars and seek to take advantage of the taxpayer give-away. Many of these cars aren’t frequently driven, if at all, so destroying them will not clean the nation’s air or make us less dependent on foreign oil.

While supporters tout a similar German program as evidence of success, the European Federation for Transport and the Environment, (the pan-European federation of environmental groups), has urged Germany and other countries to abandon scrappage subsidies because they do more environmental harm than good by artificially accelerating the car life cycle.

"Scrappage programs hurt thousands of independent repair shops, auto restorers, customizers and their customers across the country. This industry provides thousands of American jobs and generates millions of dollars in local, state and federal tax revenues. We encourage the President to help the entire auto industry with programs that focus the incentive where it counts – on the purchase of new vehicles and not destroying older cars."