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Where the US stands in pushing “Cash for Clunkers”- Four bills in Congress; Details Needed

April 13, 2009 at 4:09 pm

There are currently four bills in Congress focused on stimulating car sales by allowing people to trade an old car for a new one. There’s been lots of buzz, but not so many details. That’s starting to change as people such as Rep. Betty Sutton goes on the offensive for her own proposal .

There are currently four different proposals in Congress to stimulate stimulate car sales by way of incentives from the government to buy older, less fuel-efficient vehicles. Three are from the House of Representatives and one from the Senate . Already the topic has lit up the blogosphere with buzz about the opportunity for people to get $3,000.00 to $5,000.00 for exchanging that junker for a shiny, new automobile.Rep. Betty Sutton was on CNBC’s Squawk on the Street today talking about her version of the bill. With an official title of “To accelerate motor fuel savings nationwide and provide incentives to registered owners of high polluting automobiles to replace such automobiles with new fuel efficient and less polluting automobiles or public transportation” it’s easy to see why few details are in the media as of yet. The bill’s short title as introduced is Consumer Assistance to Recycle and Save Act of 2009. Anchors Mark Haines and Erin Burnett posted questions about how the proposal may work.

Leader in the Pack
Rep. Sutton’s Consumer Assistance to Recycle and Save (CARS) Act would give consumers incentives of $3,000 to $5,000 for turning in vehicles that are 8 years or older to buy more fuel-efficient vehicles or to obtain a transit voucher. She says that support is growing every day. The bill has gathered 21 co-sponsors so far, up from 19 a couple of weeks ago. The bill is still working out the metric of how cars would need to be traded in and what fuel efficiency would need to be for the new car. Sen. Dianne Feinstein has a similar proposal (with a short title of Accelerated Retirement of Inefficient Vehicles Act of 2009) that would mandate that the new car be 25% aboveCAFE standards . There has not been anything mentioned about how many cars one person or family can switch for the credit. Also, some states already have incentives for buying cleaner cars, so will individuals be able to get both state and federal credits? If so, in places like Texas , a person could get a combined total of as much as $8,500.00 for a new car.

Click here to read the entire article. Here is the CNBC video of the Cash for Clunkers featuring industry experts Dave McCurdy, Alliance of Automobile Manufacturers and John Wolkonowicz, IHS Global Insight.

Note: Below is a list of articles published on TransportGooru, offering insight into state of various “Cash for Clunkers” style programs implemented (or currently being debated) across the globe (Germany, UK, etc,).

Consumer Assistance to Recycle and Save (CARS) Act revives “Cash for Clunkers” scrapping plan in U.S

Germany plans to extend Abwrackprämie aka “Environmental Bonus”

The bickering starts over the implementation of the Cash for Clunkers legislation

Obama Favors “Cash for Clunkers”

Germany increases subsidy to 5 Billion Euros, tripling incentives for its “Cash for Clunker” (Abwrackprämie) program

Britain mulls implementation of “Cash for Clunkers” scheme to boost ailing auto sales

Britain mulls implementation of “Cash for Clunkers” scheme to boost ailing auto sales

April 13, 2009 at 3:23 pm

(Source: Spiegel Online via Business Week)

To boost ailing carmakers, the British government is expected to offer customers a premium to exchange clunkers for new vehicles—as Germany has done

The paper writes that Darling and officials in the Treasury have been impressed by the results the programs have delivered in other countries. Last month, Britain experienced a 30 percent drop in new car registrations at a time when Germany recorded 40 percent more vehicle sales than during the same period a year earlier. In Germany, Treasury officials noted, the precipitous drop in auto sales has been reversed.

The Times reported that details are still being hashed out between the Economics Ministry and the Treasury in London, but that the plan will look a lot like Germany’s. According to the paper, a £2,000 (€2,200) scrapping premium is to be given on trade-ins of any car over nine years old.

In contrast to Germany, though, Darling and Economics Minister Peter Mandelson are also seeking industry participation in the program. At the very least, they want a binding commitment that existing rebates will not be dropped because of the government program. So far though, the paper reports, the British automobile industry is resisting the government’s push for it to support the program with its own means.

In addition to Germany, a number of European countries including Austria, France, Italy, Portugal and Spain also have stimulus programs in place for carmakers suffering from thecredit crunch and global financial crisis—and the success of these stimulus efforts has been measurable. China and Brazil have also succeeded in increasing car sales again.

“A scrapping scheme will provide the incentive needed and the evidence is clear that schemes already implemented across Europe do work to increase demand,” Britain’s Society of Motor Manufacturers and Traders (SMMT) chief executive Paul Everitt told the Times. “The UK is the only major European market not to implement a scheme.” SMMT estimates the one-year program would cost about £160 million.

Last week, the United States also said it would adopt the successful European recipe. During a dramatic speech to the auto industry, US President Barack Obama praised the scrapping premiums as exemplary and “successful” and pledged to introduce a similar program in the US. But the program could be a lot more expensive for the United States than Britain: Already, an estimated 250 million cars and trucks are driven in America. Of those, close to 30 percent are at least 15 years old, meaning the country could have as many as 75 million candidates for scrapping.

In Germany, demand has been so strong that the government plans to extend its scrapping bonus through the end of the year. Last week, Chancellor Angela Merkel’s cabinet moved to extend the scheme until Dec. 31 and to provide €5 billion in government funding—enough to cover up to 2 million cars.

Click here to read more. Transportgooru has already published a number of articles on this topic in earlier months. Please feel free to explore them:

Consumer Assistance to Recycle and Save (CARS) Act revives “Cash for Clunkers” scrapping plan in U.S

Germany plans to extend Abwrackprämie aka “Environmental Bonus”

The bickering starts over the implementation of the Cash for Clunkers legislation

Obama Favors “Cash for Clunkers”

Germany increases subsidy to 5 Billion Euros, tripling incentives for its “Cash for Clunker” (Abwrackprämie) program

US Government put its money where its mouth is; Orders $285 Million In New Cars From Detroit

April 10, 2009 at 11:01 am

(Source: Jalopnik, Freep & World Car Fans)

Looks like American automakers have found at least one more buyer for their vehicles. The U.S. government is planning on the purchase of $285 million worth of fleet vehicles that get better gas mileage than the current fleet. Under the plan, the General Services Administration will purchase more than 17,500 vehicles as a part of their existing deals with Chrysler, Ford, and General Motors.

U.S. President Barack Obama, and his administration, have said the purchases will take place by 1 June. Although it is unclear what will happen to the older fleet vehicles being replaced, many will likely be sold at government auctions.

The purchase is hardly a surprise. In the much talked about stimulus package approved by Congress, $300 million was included for the automotive purchase. This is not a gigantic purchase in the grand scheme of things, as the Big Three sold a combined total of 380,000 vehicles for March 2009. Still, the move may help to bolster confidence in the sector, while even a marginal increase in revenue would be welcomed by the automakers.

More than 14% of the vehicles will be hybrid sedans. 2,500 orders for the vehicles, which will likely include the Chevy Malibu, Ford Hybrid Fusion, and Saturn Aura, will be placed by the end of next week.

Image: Jalopnik

If nothing else, the move underscores the administration’s willingness to put its money where its mouth is: Last week, Obama sent GM and Chrysler back to the drawing board, saying they needed more aggressive restructuring plans if they were to get more government loans to survive.

But he also promised this big government buy of fuel-efficient vehicles and created a special office to help communities in Michigan and elsewhere struggling with the downturn in the industry. In a prepared statement released today along with details of the planned purchases, Obama said, “The problems that caused this economic crisis weren’t created in a day and it will take time and hard work to get our economy back on track. But I am 100% committed to a strong American auto industry, and we will stand with America’s auto workers and their families during these difficult times.”

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Germany increases subsidy to 5 Billion Euros, tripling incentives for its “Cash for Clunker” (Abwrackprämie) program

April 8, 2009 at 7:20 pm

(Source: Telegraph, UK) Germany is more than tripling the incentives on offer to buyers of new cars as it attempts to boost its auto industry, which employs around 15pc of the nation’s workforce.

The scheme offers German consumers €2,500 for trading in vehicles more than nine years old if they buy a car that is less than one year old.

Chancellor Angela Merkel’s coalition government, which is facing re-election on September 27, agreed proposals that will increase the amount of government funds available for car subsidies to €5bn (£4.5bn) from €1.5bn.

The programme was due to expire on May 31, but the government has extended it until the end of 2009.

Ulrich Wilhelm, Mrs Merkel’s spokesman, said the new funding level would cover 2m cars, compared with 600,000 under the previous plan. The scheme has given a vital boost to German car sales, with new registrations in March hitting the highest level since 1992. “This is a massive election gift. Car dealers and buyers will be completely over the moon,” said Ferdinand Dudenhoeffer, director of the Centre for Automotive Research at the University of Duisburg-Essen in an interview with Bloomberg.

Click here to read the entire article.

TransportGooru has compiled several articles in the past reporting on similar efforts in UK (which is now contemplating introduction of a similar program after watching the Germans successfully implement the program) & USA. Here are the links to some of the earlier articles:

Consumer Assistance to Recycle and Save (CARS) Act revives “Cash for Clunkers” scrapping plan in U.S

Germany plans to extend Abwrackprämie aka “Environmental Bonus”

The bickering starts over the implementation of the Cash for Clunkers legislation

Obama Favors “Cash for Clunkers”

Smart police have fast cars – May be in Europe but not in the USofA! European Police get highway patrol cars manufactured by Ferrari, Porsche & Lamborgini cars

April 8, 2009 at 7:06 pm

(Source: Telegraph, UK)

From a Ferrari to a Smart Car, police forces around the world are spoiled for choice for fast cars when it comes to patrolling their patch.

There is fierce competition for the world’s fastest police car with the Italians and Germans vying for the title.

Up until now the police prix d’or has been held by a Lamborghini Gallardo which an Italian police patrol is using on the Salerno-Reggio Calabria highway.

It is capable of hitting a top speed of 192mph, which is probably ample to keep up with the most reckless of motorists.

But the Germans have their eye on a car which would leave the Lamborghini trailing in its wake.

It has placed an order for a Brabus CLS V12 S Rocket which has a top speed of 225mph. It will be used on the fastest stretches of the autobahn.

In San Diego officers are using a custom made police car with integrated shotgun mounts and a top speed of 155mph.

This article states that some of the British police officers drive the Greenest, if not the meanest, among all forces – the tiny SmartforTwo cars.

TransportGooru wonders if this San Diego squad car is a silly Dodge Charger. American police officers should think about doing some police work in Europe! It will make a great cinema when California Highway Patrol chasing some Hollywood superstar’s Lamborghini Gallardo with his Dodge Charger with integrated shot gun mounts!

On a releated note, few days back a South Carolina Trooper, J.D. McGaha, was cited for speeding in his unmarked patrol car. Guess what he got for mashing his Dodge Charger – 3 days suspension, possible fine worth $355 & 6 points on his license. Oh, his Dodge Charger was taken back by his Department. Trooper McGaha is definitely not driving a Charger like a Ferrari anymore. Read the TransportGooru article on this incident here.

McKinsey Quarterly: Andy Grove, former CEO of Intel, proposes an electric plan for energy resilience

April 3, 2009 at 1:04 pm

(Source: McKinsey Quarterly ;Video: The Auto Channel @ YouTube)

The fastest way to reduce America’s dependence on oil imports is to convert petroleum-driven miles to electric ones by retrofitting the SUVs and pick-ups now on the road with rechargeable batteries. Here’s how.

Every president since Richard Nixon has vowed to reduce the United States’ dependence on foreign oil. None has succeeded. Imports—and thus America’s vulnerability to disruptions—have increased to where now they supply two-thirds of consumption. As former Secretary of State George Schultz asked: “How many more times must we be hit on the head by a two-by-four before we do something decisive about this acute problem?”

Our aim should not be total independence from foreign sources of petroleum. That is neither practical nor necessary in a world of interdependent economies. Instead, the objective should be developing a sufficient degree of resilience against disruptions in imports. Think of resilience as the ability to absorb a significant disruption, bigger than what could be managed by drawing down the strategic oil reserve.

Our resilience can be strengthened by increasing diversity in the sources of our energy. Commercial, industrial, and home users of oil can already use other sources of energy. By contrast, transportation is totally dependent on petroleum. This is the root cause of our vulnerability.Our goal should be to increase the diversity of energy sources in transportation. The best alternative to oil? Electricity. The means? Convert petroleum-driven miles to electric ones.

Electric miles do not necessarily mean relying on all-electric cars, which would require building an extensive and expensive infrastructure. They can be achieved by so-called plug-in electric vehicles (PEVs). (Since many plug-in cars are modified hybrid automobiles, they are sometimes called PHEVs.) PEVs have both a gasoline-fueled engine and an electric motor. They first rely on the electricity stored onboard in a battery. When the battery is depleted, the vehicle continues to run on petroleum. The battery then can be charged when the vehicle is not in service.

The engineering and organizational issues involved in retrofitting on a large scale are far from trivial. The biggest problem, however, is the availability of batteries. The most suitable battery technology, which offers both a sufficient range and enough power to provide the acceleration required by today’s drivers, is the lithium-ion battery system. Current battery-manufacturing capacity is limited, and nearly all of it is dedicated to supplying batteries for the nearly 200 million laptop computers and other handheld electronic devices built each year. Making the batteries required for one million vehicles would mean doubling current manufacturing output.

Click here to read the entire article (Register for Free to read and hear the entire discussion).

NOTE:

TransportGooru is proud to share Andy Grove’s keynote address on the critical importance; and business opportunity and viability; of moving transportation from oil to electricity.

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Obama Favors “Cash for Clunkers”

April 1, 2009 at 7:43 pm

(Source: TreeHugger); Video: YouTube)

Yesterday President Obama told Chrysler and GM that it is time to shape up or ship out. He also said he supports a program that would pay people to trade in older cars for newer, more fuel efficient vehicles. Europe has successfully tried this, but could it work here and would it be good for the planet?

Speaking about a so called “cash for clunkers” program, Obama said:

“Such fleet modernization programs, which provide a generous credit to consumers who turn in old, less fuel-efficient cars and purchase cleaner cars, have been successful in boosting auto sales in a number of European countries.”

Here is an analysis from a News portal on what it could mean for consumers.

This is especially true in Germany, where new auto sales are said to have risen 20 percent last month. Of course, Europe has much higher gas prices than we do, increasing the desire to go with a greener car. They are also taxing people for their carbon output, again incentivizing people to get rid of heavier, more inefficient cars and trucks., A gas tax and other complimentary taxes that would bring our prices in line with Europe’s is politically unlikely, so a trade-in program may have some political legs given Congress’s new found attention on the climate.

Another supporter is Ohio Rep. Betty Sutton, who sponsors the CARS Act, which creates vouchers of between $3,000 and $5,000 for people to trade-up. Given the president’s announcement yesterday, it’s suddenly a viable question to ask if there will be any American cars to buy if a cash for clunkers plan was enacted.

Here are some of the related posts from TransportGooru:

Consumer Assistance to Recycle and Save (CARS) Act revives “Cash for Clunkers” scrapping plan in U.S

Germany plans to extend Abwrackprämie aka “Environmental Bonus” (in plain english, car scrapping program)

The bickering starts over the implementation of the Cash for Clunkers legislation

Attention All Men: Study Says Women More Attracted To Men In Expensive Cars

March 27, 2009 at 1:14 pm

(Source: Jalopnik)

A UK university’s released a study proving what any car salesman’s ever told us, women judge men primarily by wealth and status, digging guys in expensive cars more than those driving an econobox.

The survey, run by researchers at the University of Wales Institute in Cardiff, claims it shows women rate a man higher if he is behind the wheels of a “fancy motor rather than in an old banger.” The University team showed women pictures of the same man sitting in two cars — a $100,000 silver Bentley Continental and a battered Ford Fiesta. The women, aged between 21 to 40, picked the man sitting in the Bentley ahead of the same man in the Ford.

The source article on Telegraph UK quotes the study’s author, Dr Dunn, that he believes this basic human trait will not change in the future – even as women become more independent and wealthy in their own rights. He said: “It appears that the stereotype of women being positively influenced by a man’s status is true and, evolutionarily speaking, this makes sense. “However, even with the growing number of women in high-paid careers and the fact that they can be highly successful has no effect on how attractive they are to men. “What you find is that these new, wealthy women still show a preferment for high-status males.”

Now his researchers plan to carry out further studies – to guide men buying expensive cars in their mid-life crisis. Dr Dunn, who admits to driving an old Ford Ka, will examine if high-status items like expensive cars can help make up for “the attractiveness-diminishing effects of age.”

Click here to read more.

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To buy American or Foreign? The Argument for Buying Domestic Over Foreign

March 19, 2009 at 12:39 pm

(Source: TreeHugger; Photo via: Mike Licht, NotionsCapital.com)

The American auto industry has gotten a bad wrap over the years, and justly so in many ways. While a lot of negative responses continue to circulate around the Big Three, their Bailout, and their past inferior vehicles, they have actually risen above this ridicule and at the very least deserve a second look.

Bankruptcy
While a lot of consumers may be hesitant to purchase a vehicle from any manufacturer who is talking the possibility of bankruptcy, you should know that they are obligated to their warranty coverage no matter what happens to them. It is a binding contract from both sides of the pen. And while a lot of consumers are under the dilution that the foreign manufacturers are doing that much better than the American manufacturers, in truth they are also beginning to feel the pinch of the recession and have been asking for their own brand of bailout from their government.

Quality Rivals Japan
The Japan manufacturer has enjoyed being the top dogs for many years among the consumer ratings and ranking. However a very unsuspecting competitor has risen from the depths of gas guzzling SUVs and has begun to rival Japan’s quality, reliability, safety, and environmental friendliness… the domestics. In fact, both the ChevroletMalibu and Ford Fusion are ranked right along with the Honda Accord and ToyotaCamry according to U.S.News. Aside from these, J.D. Power and Associates second this praise, rating American brands as equivalent to such heavy hitters as Audi, Acura, BMW, Honda, Nissan, Toyota, Lexus, and Mercedes-Benz in overall quality.

Click here to read the entire article.

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Changing attitudes — Bye Bye Car :(, says Kyle Aevermann on CNN’s iReport

March 10, 2009 at 10:36 am

(Source: CNN iReport)

The society’s adjustmentsto the changing economic climate has some positive implications for the global climate. Listen to what the younger generation has to say .. I am sure Kyle is not alone..Refreshing to see more people abandoning the “need a car” attitude and starting to think “Yes, I can do without a car”..Kudos to Kyle for sharing his thoughts and Transportgooru wishes you the very best for your “no car” life..

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TransportGooru

Where the US stands in pushing “Cash for Clunkers”- Four bills in Congress; Details Needed

Britain mulls implementation of “Cash for Clunkers” scheme to boost ailing auto sales

To boost ailing carmakers, the British government is expected to offer customers a premium to exchange clunkers for new vehicles—as Germany has done

US Government put its money where its mouth is; Orders $285 Million In New Cars From Detroit

Germany increases subsidy to 5 Billion Euros, tripling incentives for its “Cash for Clunker” (Abwrackprämie) program

Smart police have fast cars – May be in Europe but not in the USofA! European Police get highway patrol cars manufactured by Ferrari, Porsche & Lamborgini cars

From a Ferrari to a Smart Car, police forces around the world are spoiled for choice for fast cars when it comes to patrolling their patch.

McKinsey Quarterly: Andy Grove, former CEO of Intel, proposes an electric plan for energy resilience

The fastest way to reduce America’s dependence on oil imports is to convert petroleum-driven miles to electric ones by retrofitting the SUVs and pick-ups now on the road with rechargeable batteries. Here’s how.

Obama Favors “Cash for Clunkers”

Attention All Men: Study Says Women More Attracted To Men In Expensive Cars

To buy American or Foreign? The Argument for Buying Domestic Over Foreign

Changing attitudes — Bye Bye Car :(, says Kyle Aevermann on CNN’s iReport

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Post Tagged with: "Cars"

To boost ailing carmakers, the British government is expected to offer customers a premium to exchange clunkers for new vehicles—as Germany has done

From a Ferrari to a Smart Car, police forces around the world are spoiled for choice for fast cars when it comes to patrolling their patch.

The fastest way to reduce America’s dependence on oil imports is to convert petroleum-driven miles to electric ones by retrofitting the SUVs and pick-ups now on the road with rechargeable batteries. Here’s how.

Recent Posts

Archives

Trending For @Transportgooru

Favorite Blogs

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