Senator Bayh on Cash for Clunkers

“Cash for Clunkers” program will create and preserve Hoosier auto jobs, reduce dependence on oil

June 18, 2009 -- Washington – Senator Evan Bayh is supporting congressional efforts to boost car sales in Indiana and across the country, stimulate the struggling automotive sector, and reduce the nation’s overall dependence on foreign sources of oil.

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Bayh is a cosponsor of the Drive America Forward Act of 2009, known more commonly as the “Cash for Clunkers” program. The legislation would provide financial incentives for the purchase of new, more fuel-efficient cars for consumers who trade in older vehicles with poor fuel-efficiency ratings.

Nationwide lightweight vehicle sales have stalled dramatically in recent years, dropping from 16 million units in 2007 to a projected 10 million units for all of 2009—a 40 percent decline.

“This ‘Cash for Clunkers’ legislation is a win-win-win proposition for hardworking, middle-class consumers, struggling auto dealerships and manufacturers, and the ongoing effort to reduce our country’s dangerous dependence on foreign sources of oil,” said Sen. Bayh. “By providing common-sense financial incentives for consumers to trade-in obsolete gas guzzlers for more fuel-efficient cars, our proposal will encourage customers to get back in the showroom and take another look at a new car while protecting jobs in our auto communities.”

“Cash for Clunkers” targets drivers whose cars have a combined fuel economy of 18 miles per gallon (mpg) or less. The bill offers a $3,500 voucher for a new passenger car with at least a four mpg improvement or $4,500 for a 10 mpg improvement. New passenger cars must have a minimum fuel economy of 22 mpg.

For light sport utility vehicles (SUVs) and trucks, new vehicles with a two mpg improvement are eligible for a $3,500 voucher and $4,500 for a five mpg improvement. New SUVs and trucks must have a minimum fuel economy of 18 mpg. Vouchers may only be used for vehicles with a maximum suggested retail price of $45,000.

Source: Senator Evan Bayh