U.S. ‘Cash-For-Clunkers’ Proposal May Cover Cars From Overseas

U.S. ‘Cash-For-Clunkers’ Proposal May Cover Cars From Overseas

April 17 (Bloomberg) -- U.S. lawmakers may let cars made overseas qualify for a proposed “cash-for-clunkers” program in a bid to secure passage of the measure, designed to help revive domestic auto sales at a 27-year low.

An option under consideration would distribute subsidies to new-car buyers based on manufacturers’ U.S. market share, said Representative Betty Sutton, sponsor of the proposal. The approach may overcome objections that Sutton’s original plan subsidizes North American-made products only.

“There are a lot of ideas out there on the table and certainly we’re exploring them,” Sutton, an Ohio Democrat, said in an interview yesterday. “I’ve always been open to finding mechanisms, avoiding wrinkles, if people have differing views.”

Spurred by the success of a similar program in Germany, backers say they want to speed the measure through Congress soon after it returns from a recess next week. The goal is to stoke sales at automakers including General Motors Corp. and Chrysler LLC, which are surviving on taxpayer aid and face bankruptcy deadlines imposed by the Obama administration.

New autos sold at an annual rate of 9.86 million units in March, the slowest pace since 1982, according to Autodata Corp. of Woodcliff Lake, New Jersey. The rate averaged 16.8 million this decade through 2007.
“What I have been looking for is a solution that would treat all manufacturers fairly,” Representative Edward Markey, the Massachusetts Democrat who crafted the market-share idea, said in an e-mail. “I am hopeful that this could prove to be a constructive way forward that all sides could agree on.”

$5,000 Vouchers

Consumers would receive vouchers worth as much as $5,000 for trading in models from 2001 or earlier for a new vehicle, under the legislation Sutton proposed March 17. The program may spur sales by more than the 21 percent increase witnessed in Germany in February, Sutton has said.

Read More:
http://www.bloomberg.com/apps/news?pid=20601109&sid=arRGEXPmOojA&refer=home