The alternative bill also gave a $1,000 voucher for the purchase of a more efficient used car the House bill completely excluded used vehicles. Pre-1999 work trucks would be eligible for the $2,500 voucher regardless of mileage improvements. Mileage improvement requirements would be less for light and heavy duty trucks. The alternative bill would have required that the trade-in vehicle have a fuel economy rating of 17 mpg or less and offered a three-tiered voucher system ranging from $2,500 for a new car that is 7 mpg more efficient than a trade-in to $4,500 for one that is 13 mpg more efficient. Proponents argued that the alternative bill would lead to 32% more efficiency improvements than the House-Stabenow-Brownback version of the program. In the Senate, Debbie Stabenow (D- Michigan), and Sam Brownback (R- Kansas) sponsored a bill very similar to the House's.Īn alternative bill proposed by Dianne Feinstein (D- California), Susan Collins (R- Maine), and Charles Schumer (D- New York) would have had a greater focus on increasing fuel economy. Betty Sutton (D- Ohio), allowed consumers to trade in vehicles with a combined fuel economy of 18 or less for new, more efficient vehicles. The House approved the creation of a cash-for-clunkers program with the 298 to 119 passage of the CARS Act ("Consumer Assistance to Recycle and Save Act", H.R. Jack Hidary of Smart Transportation and Bracken Hendricks of the Center for American Progress co-wrote a paper which was distributed to Congressional offices in November 2008 describing the multiple benefits of a cash-for-clunkers program.
Ī number of organizations advised Congress in developing the program including ACEEE, CAP Action Fund and. Blinder argued that a cash-for-clunkers program would have a tripartite purpose of helping the environment, stimulating the economy, and reducing economic inequality. 7.6 Exotic cars crushed under the programĮconomist Alan Blinder helped popularize the idea of a scrappage program, and the moniker "cash for clunkers", with his July 2008 op-ed piece in the New York Times.7.3.1 Rationale for removing the most inefficient vehicles.5 National Motor Vehicle Title Information System.4 Engine disablement and scrappage criteria.Another study by researchers at the University of Michigan found that the program improved the average fuel economy of all vehicles purchased by 0.6 mpg in July 2009 and by 0.7 mpg in August 2009. Ī study published after the program by researchers at the University of Delaware concluded that for each vehicle trade, the program had a net cost of approximately $2,000, with total costs outweighing all benefits by $1.4 billion. The Department of Transportation also reported that the average fuel efficiency of trade-ins was 15.8 mpg (miles per gallon), compared to 24.9 mpg for the new cars purchased to replace them, translating to a 58% fuel efficiency improvement. Meanwhile, Japan's own program excluded U.S. It led to a gain in market share for Japanese and Korean manufacturers at the expense of American car makers, with only Ford not taking a significant hit.
At the end of the program Toyota accounted for 19.4% of sales, followed by General Motors with 17.6%, Ford with 14.4%, Honda with 13.0%, and Nissan with 8.7%. On August 26 the DoT reported that the program resulted in 690,114 dealer transactions submitted requesting a total of $2.877 billion in rebates. In response, Congress approved an additional $2 billion. According to estimates of the Department of Transportation, the initial $1 billion appropriated for the system was exhausted by July 30, 2009, well before the anticipated end date of November 1, 2009, due to very high demand.
The deadline for dealers to submit applications was August 25. The program officially started on July 1, 2009, processing of claims began July 24, and the program ended on August 24, as the appropriated funds were exhausted. The program was promoted as providing stimulus to the economy by boosting auto sales, while putting safer, cleaner, and more fuel-efficient vehicles on the roadways. residents to purchase a new, more fuel-efficient vehicle when trading in a less fuel-efficient vehicle. federal scrappage program intended to provide economic incentives to U.S. The Car Allowance Rebate System ( CARS), colloquially known as " cash for clunkers", was a $3 billion U.S. The Ford Explorer 4WD was the program's top trade-in according to the U.S.