(Source: Wall Street Journal)

Efficient Drivers Cut Emissions, but Stir Up Hot Air

Cruising around this desert metropolis in her four-door pickup truck, Morgan Dresser doesn’t look like an environmental trendsetter.

Click here to read the entire article.

 (Source: Time)

A Lot Full of Old Clunkers For Sale

It’s no secret that one of the biggest reasons the U.S. auto industry is teetering on collapse is that, quite simply, Americans have stopped buying cars. U.S. auto sales were down 37% in March from 2008, the latest in a nearly unbroken year-and-a-half streak of falling sales. And if the cratered economy is the main culprit behind backed-up inventory at U.S. car dealers, another is that American automakers have failed to produce the more fuel-efficient vehicles that gas-price-conscious car buyers are beginning to demand. As a result, the U.S. still sends hundreds of billions of dollars overseas for oil — and adds ever more greenhouse-gas pollution into the atmosphere. 

Now what if there were a way to tackle both these problems with one policy: to stimulate demand for American cars while making the U.S. auto fleet cleaner, greener and more efficient? It sounds like the kind of slick two-for-one pitch you might hear from a used-car salesman, but that’s exactly what proponents of a “cash for clunkers” program are promising.

But is cash-for-clunkers really two-for-one? That depends. There are currently two main bills in the House and Senate, which, according to greens, are not created equal. One, sponsored by Democratic Ohio Representative Betty Sutton, allows any car from model year 2000 or earlier to be traded in, without any restriction on fuel economy. In return, car buyers will get $4,000 if they buy a new U.S. car that gets a minimum mileage of 27 m.p.g. and $5,000 if they buy a U.S. car with at least 30 m.p.g. Crucially, the new cars have to be made in the U.S. — foreign brands can qualify, but only if they’re manufactured on U.S. soil, which would disqualify super-efficient vehicles like Toyota’s Prius hybrid, made only in Japan.

Whichever bill is chosen — and others are being circulated as well — a successful cash-for-clunkers program wouldn’t be cheap. Germany’s program may end up costing the government some $6 billion, three times the initial price tag. Since Obama has said that money for the cash-for-clunkers program needs to come out of existing stimulus spending, that might take some creative accounting. But a cash-for-clunkers program, whatever its environmental benefits, would provide the government with a way to aid the domestic auto industry without giving Detroit any more direct handouts. “There’s a lot of justifiable taxpayer reluctance to keep helping the auto industry,” says Goldstein of the Center for American Progress. “Politically this is a viable alternative to sending them additional loan money.”

(Source: Washington Post) 

Without higher gas taxes, ‘cash for clunkers’ won’t do the job 

CAR SALES in Germany jumped an astonishing 40 percent in March, thanks in large part to a “cash for clunkers” program in which the government gave those handing over old-model cars roughly $5,000 toward the purchase of newer, more fuel-efficient vehicles. Lawmakers in the United States have crafted similar proposals, hoping both to provide a boost to the U.S. auto industry and to spur sales of environmentally friendlier cars. But even the best of these proposals is not likely to provide the punch of the German initiative.

Click here to read the entire article (free regn. required).  

Note:  Below is a list of articles on this issue, previously published on TransportGooru.  This compilation of articles offer an insight into state of various “Cash for Clunkers” style programs implemented (or currently being debated) across the globe (Germany, UK, etc,). Stay plugged in to TransportGooru for more on this topic in the days to come.

 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 

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

(Source: Tree Hugger)

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

(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

(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.

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”

(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:

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

(Source: Bloomberg)

Cars and light trucks will be required to meet a U.S.fuel-economy average of 27.3 miles per gallon for 2011 models, a 2 mpg increase from the previous year’s level, the Transportation Department said.

The 8 percent gain announced today in Washington carries out a 2007 law intended to curb emissions and fuel use. The change, being put in place asGeneral Motors Corp. and Chrysler LLC face possible bankruptcy, isn’t as aggressive as the 27.8 mpg target that President George W. Bush proposed in April 2008.

“This isn’t going to be a stretch for them to meet this,” David Kelly, former acting head of the National Highway Traffic Safety Administration under Bush, said of automakers. New-car fuel economy already averaged 31.3 mpg by 2007, NHTSA said in today’s rule.

Cars must average 30.2 mpg, up from 27.5 currently, under the rule. Light trucks will average 24.1, up from 23.5 mpg for 2010 models. The December 2007 law called for vehicles to meet a 35 mpg standard by 2020 models, a 40 percent increase from the average in 2008.

“The bad news is that the 27.3 mpg standard means that they’ll have to make up for it in future years,” said Dan Becker, director of the Safe Climate Campaign, a group in Washington that works for environmentally “clean” cars. “The goods news is that they have promised that they will.”

President Barack Obama’s administration had a March 31 deadline for setting the standard, giving the industry about 18 months to prepare its 2011 models to meet the requirement. Bush never issued his proposed standard before he left office.

Click here to read the entire article.