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House Quickly Sends $2 Billion More to ‘Cash for Clunkers’

2:43 PM PDT on July 31, 2009

The "cash for clunkers" rebate program, which promises new auto buyers up to $4,500 for fuel-efficiency upgrades as small as 2 miles per gallon, is back to life after burning through $1 billion in taxpayer cash.

ago, the House approved $2 billion more in auto rebates by transferring
cash that was already headed for loan guarantees at the Department of
Energy -- averting the need to add the new spending to the deficit. The
vote was 316-109.

The last-minute race to keep auto-industry benefits alive, which President Obama is strongly backing,
now moves to the Senate. A bipartisan group there is already
threatening to oppose new "clunkers" money unless its fuel-efficiency
requirements are improved and used cars are approved for purchase

Right now buyers can get
a $3,500 discount on new cars that get as little as 22 mpg. Small truck
buyers are only required to improve 2 mpg to receive the same rebate,
achieving a combined city and highway efficiency of 20 mpg.

early version of the plan would have allowed the rebate value to be
taken in transit coupons, but the DOT said earlier this week that no
such option would be available.

Meanwhile, one environmental group that supported
a stronger version of the "clunkers" plan that became law is now urging
members to encourage the purchase of more efficient cars than the

"These are taxpayer dollars to help sell new cars,"
the Sierra Club wrote to its members. "It is up to consumers to put
these dollars toward the purchase of highly efficient new vehicles not
just a new guzzler."

Statistics on the early performance of
the "clunkers" program, released by Rep. Ed Markey's (D-MA) office,
follow after the jump.

Late Update: 14 Democrats joined 95
Republicans in opposing the $2 billion. The 14 were Reps. Earl
Blumenauer (OR), Stephanie Herseth Sandlin (SD), Brian Baird (WA),
Lloyd Doggett (TX), Kurt Schrader (OR), Scott Murphy (NY), Jim Marshall
(GA), Gabrielle Giffords (AZ), Allen Boyd (FL), Harry Mitchell (AZ),
John Tierney (MA), Collin Peterson (MN), Jared Polis (CO), and Ann
Kirkpatrick (AZ)

    • During the week thatthe program was launched, GM’s small carsales increased 54.8 percent over the preceding week.
    • The leading Fordvehicle being purchased under the program is the 28 mpg Ford Focus at nearly 30percent of all Ford sales.
    • Toyotareports 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 a59 percent increase in fuel economy compared to the old vehicle -- whichaveraged 140,000 miles.

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