In the wake of General Motors and Chrysler filing for bankruptcy, layoffs of auto workers, and the closure of car dealerships, Congress passed the “Cash For Clunkers” program last month to provide consumers who trade in their old, gas-guzzling vehicles with vouchers worth up to $4,500 to help pay for new, more fuel efficient cars and trucks. After reports yesterday that “Cash For Clunkers” was so successful in its first week of implementation that it was running out of money, the House voted 316 to 109 this afternoon to extend the program with an additional $2 billion in funding.
More than 200,000 cars have already been bought through the program, and it is expected to spur the sale of up to 800,000 more fuel-efficient cars and trucks, while stimulating the ailing auto industry and reducing our dependence on foreign oil. The funds to immediately extend the “Cash For Clunkers” program are coming from a clean energy fund appropriated in the American Recovery and Reinvestment Act and will be returned so as to further our nation’s long term clean energy and innovation goals.
Statistics from carmakers and cashforclunkers.org show that the oil-savings results thus far have been phenomenal:
79% of clunkers being traded in so far are SUVs, trucks and vans with over 100,000 miles
84% of the new vehicles purchased are passenger cars
Clunker consumers are getting an average 69% MPG improvement, which will result in an average savings of $750 in gas bills per year
During the week that the ‘Cash for Clunkers’ program was launched, GM's small car sales increased 54.8 percent over the preceding week
The leading Ford vehicle being purchased under the program is the 28 mpg Ford Focus at nearly 30 percent of all Ford sales
Toyota reports that 78% of their Cash for Clunkers volume were the Corolla, Prius, Camry, RAV 4 and Tacoma, with a resulting average of 30 mpg
Hyundai is reporting a 59 percent increase in fuel economy compared to the old vehicle–which averaged 140,000 miles
In about six days, it is estimated that 250,000 cars were sold. On both sides of the aisle, people acknowledged the effectiveness of this initiative. And that is why yesterday, as we were seeing what was happening this week, the Obama Administration asked us to help consumers who have yet to have the opportunity to take advantage of trading in their old cars for new energy efficient models. When they do that, they strengthen the auto industry, strengthen our economy at large, and help preserve our environment.
Chairman Ed Markey (D-MA):
This program is a win for consumers who are trading in old gas guzzlers for hybrids, a win for our economy and a win for energy independence and the environment as the new vehicles are averaging 60% more fuel efficiency than the junkers being taken off the road.
Rep. Jay Inslee (D-WA):
I want to just make a point that this program has been spectacularly successful from an environmental perspective. It was originally criticized that we did not call for a high enough efficiency improvement of these cars. The people have fixed this problem for us. We are seeing average increases of efficiency of 60% — well, well above what was required by Congress. One car company 78% of the cars that they’re buying are over 30 MPG, 39% above 30 MPG. The American people have had spectacular improvements in the efficiency and the environmental performance.
Rep. Steve Israel (D-NY):
Many of us knew that it would work well, few of us realized how well it would work. This program has been truly stimulative…we have doubled car sales over the past five years…it is creating jobs, it is a creating a surge for car dealers. The American consumer is satisfied with it — the American consumer has taken cash for clunkers on a test drive and they want to continue driving cash for clunkers.