Cash For Clunkers

According to CBS News website “Pressure is mounting for House Energy and Commerce Chair Henry Waxman (D-Calif.) to bring the legislation to the House floor by Memorial Day, as he promised. The committee could vote on the bill next week.”  Read full story

If this is correct, then in just weeks auto dealers will know if they will be getting a much needed boost from the US government, with tax payer dollars.  The bill has many advocates and opponents. Some US consumers, sharing their opinions on blogs are calling these types of programs Obama socialism.  The blogshere is a buzz with commentary on the bill which is also referred to as the “Cash for Guzzlers” program.

Cash For Clunkers to Generate 1 Million New Car Sales

According to the New York Times, some details on the proposed government voucher program are still not clear.  “The fact sheet did not say how much the government would commit for the program, which would run only for a year. Yet Congressional Democrats expect about 1 million older cars to be taken off the road, an ambitious number considering that fewer than 100,000 cars have been scrapped in California and Texas, where programs have been in place for several years. “ Read full blog post in the NYT Wheels Section.

Car Dealers Seeking Relief

In a random poll of car dealers, all are hoping that the bill would pass which would give them a much need shot in the arm.  With dealership experiencing drops in new cars sales 30-40% and used car sales outpacing new car sales, this stimulus bill is just what the doctor ordered. 

In the past 9 months, most car dealers have been selling more used cars than new cars.  The bill would be a way to move a large backlog of new car inventory that is sitting at US ports.  The question at hand is how long will taxpayers need to prop up the US auto industry.  Consumers are growing impatient with the number of bailout packages being offered.   Some Lawmakers, like Rep. Jay Inslee (D-Wash.),  are convinced that this bill will be delivering the right medicine for both the auto industry and the US consumer.