The nation’s cash for clunkers program is still weeks away from officially kicking off but lawmakers on Capitol Hill are said to be mulling an extension for the scrappage program. Congress could revisit the incentive program as soon as this fall.
The federal government has set aside $1 billion for the current cash for clunkers program but some say that won’t be enough to kick start the U.S. car market. “I think it’ll go very quickly, and Congress may have to revisit it in the fall,” Dave McCurdy, president of the Alliance of Automobile Manufacturers, told Automotive News. In its current form, the cash for clunkers program is expected to generate about 250,000 new vehicle sales.
Although some automakers are already accepting clunker trade-ins, the officially program doesn’t take effect until July 23rd.
However, the cash for clunkers program is far from guaranteed an extension. Per the terms of the program, a vehicle must average 18 mpg or less in order to be eligible, heavily favoring owners of trucks and SUVs. If the majority of clunkers purchases prove to be light trucks, Congress will quickly pull the plug on any kind of scrappage extension.
