Senate OK's $2 billion more for Cash for Clunkers

Lawmakers pass an extension of the popular program aimed at boosting auto sales.

EMAIL  |   PRINT  |   SHARE  |   RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By Jennifer Liberto and Ben Rooney, CNNMoney.com staff writers

Find your next Car


WASHINGTON(CNNMoney.com) -- The Senate voted 60-37 passing a $2 billion extension of the popular Cash for Clunkers program Thursday evening, as lawmakers rushed to finish business before their August recess.

The House had already voted to extend the program, which blew through its $1 billion in initial funding, before it adjourned for the summer last Friday.

"This will be a great weekend to go out and buy an American made auto," Sen. Debbie Stabenow, D-Mich. said.

During the debate, Senate Republicans offered a half dozen amendments to the program. One would have banned all future bailouts and another would have provided tax credits to spur more home sales.

But Sen. Carl Levin, D-Mich., warned that any attachments would bounce the bill back to the House, delaying the program until after the summer break in September.

Although the vote mostly went along party lines, seven Republicans voted for it and four Democrats voted against the measure.

President Obama is expected to sign the extension into law as early as Friday.

"Now, more American consumers will have the chance to purchase newer, more fuel efficient cars and the American economy will continue to get a much-needed boost," President Obama said in a statement.

But getting Senate votes to extend the program was no easy task. Levin said late Thursday that this clunkers extension is likely the last Congress is willing to give.

"Never say never, but at this point, this is probably the extent of the program," he said.

How it's going

Under the Clunkers program as enacted, vehicles purchased after July 1 are eligible for refund vouchers worth $3,500 to $4,500 on traded-in gas guzzlers. The trade-in vehicle has to get a combined city and highway fuel economy rating of 18 miles per gallon or less.

According to government figures, compact cars and hybrids have been the top sellers so far.

The top-selling car had been the Ford Focus, but new figures released Wednesday show that the Toyota Corolla captured the top spot. All three of the top sellers, including the Honda Civic, are all compacts.

The list also includes three vehicles that are available as hybrids. One, the Ford Escape, is a small crossover SUV also available as a hybrid.

The sales results indicate that consumers are buying more fuel-efficient vehicles than most people expected. The average combined city and highway fuel economy of the 10 cars ranges from at 27 to 33 miles per gallon, depending on which versions people choose.

While critics had feared that car shoppers would use the program mostly to buy trucks, in fact 83% of the vehicles traded in have been trucks and SUVs while 60% of vehicles purchased were passenger cars, according to Secretary of Transportation Ray LaHood.

The broad category of SUVs includes many small car-like crossover SUVs, including the Escape.

Last month, many of the vehicles with the biggest reported year-over-year sales gains were small crossovers, a fact that several of the top automakers attributed to the Cash for Clunkers program.

The average fuel economy of new vehicles being purchased under Cash for Clunkers is 25.4 mpg, LaHood said, and the average fuel economy increase from the old vehicle to the new is about 61%.

--CNN congressional correspondents and White House senior correspondent Ed Henry contributed to this report.

Are you part of a Detroit-area family with a tradition of working in the automotive industry? Send an email to gmannes@moneymail.com and you could be included in an upcoming Money magazine story. To top of page

Features
They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
8 of the world's craziest fast food items American food chains operating abroad must cater to local tastes to succeed. The results are spectacular. More
Inside the $50,000 Emmys swag bags If getting nominated or presenting an Emmy award isn't prize enough, celebrities come away from TV's big night with luxury goods and vacations worth $50,000. Take a peek at some of this year's luxe giveaways. More
10 most expensive cars sold at Pebble Beach These multi-million-dollar cars sold for top dollar at this year's Pebble Beach collector car auctions. More
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.