A few hours ago, the American government adopted a bill enabling the resale of un-efficient vehicles and giving an interesting incentive for the purchase of a new car with a better fuel consumption rating.
Over one million vehicles will be retired with the program, around 150,000 of which will be replaced by cleaner vehicles by the scheduled end of the initiative on November 1, 2009.
Dubbed “Cash for Guzzlers”, the program will see consumers receive a $3,500 voucher if the vehicle they’re retiring consumes over 13.1 litres per 100 km on average according to the EPA’s estimates. However, it will have to be replaced by a new vehicle consuming less than 10.6 litres per 100 km.
Even better, if the replacement vehicle is more fuel-efficient, i.e., if the difference in consumption exceeds 10 miles per gallon between the old and new cars, consumers will receive a $4,500 voucher.
Interestingly, no restriction has been placed on the origin or make of the purchased vehicles. We all know that when Obama proposed his automotive plan he insisted that the cars be of American origin. Nevertheless, no such decision affects the Cash For Guzzlers program.
Several countries around the world have already adopted similar programs. Germany, for instance, introduced the same type of initiative and it was an immediate success. During the first month, with a German auto industry in a 51% free falling, a total of 150,000 requests were filed leading to as many purchases of new vehicles in just a few short weeks. The U.S. obviously hopes that the bill will have the same quick economic repercussions.
In Canada, several manufacturers like Ford Canada have petitioned the federal government for the introduction of a similar program. For the moment, consumers can receive $300 when they retire their old car – an amount that translates into cash, a bike or a monthly transit pass depending on the province!
In the U.S., Congress dedicated a billion-dollar budget to Cash for Guzzlers. The program will come into effect 30 days after the president signs the bill, scheduled for today.
photo:Cash for Guzzlers
Over one million vehicles will be retired with the program, around 150,000 of which will be replaced by cleaner vehicles by the scheduled end of the initiative on November 1, 2009.
Dubbed “Cash for Guzzlers”, the program will see consumers receive a $3,500 voucher if the vehicle they’re retiring consumes over 13.1 litres per 100 km on average according to the EPA’s estimates. However, it will have to be replaced by a new vehicle consuming less than 10.6 litres per 100 km.
Even better, if the replacement vehicle is more fuel-efficient, i.e., if the difference in consumption exceeds 10 miles per gallon between the old and new cars, consumers will receive a $4,500 voucher.
Interestingly, no restriction has been placed on the origin or make of the purchased vehicles. We all know that when Obama proposed his automotive plan he insisted that the cars be of American origin. Nevertheless, no such decision affects the Cash For Guzzlers program.
Several countries around the world have already adopted similar programs. Germany, for instance, introduced the same type of initiative and it was an immediate success. During the first month, with a German auto industry in a 51% free falling, a total of 150,000 requests were filed leading to as many purchases of new vehicles in just a few short weeks. The U.S. obviously hopes that the bill will have the same quick economic repercussions.
In Canada, several manufacturers like Ford Canada have petitioned the federal government for the introduction of a similar program. For the moment, consumers can receive $300 when they retire their old car – an amount that translates into cash, a bike or a monthly transit pass depending on the province!
In the U.S., Congress dedicated a billion-dollar budget to Cash for Guzzlers. The program will come into effect 30 days after the president signs the bill, scheduled for today.
photo:Cash for Guzzlers