Washington, D.C. – The U.S. has signed into law a “Cash for Clunkers” bill that will provide vouchers of up to US$4,500 for consumers who purchase new, more fuel-efficient vehicles when they trade in a less-efficient vehicle.
The program, called the Car Allowance Rebate System (CARS), will be administered by the National Highway Traffic Safety Administration (NHTSA). Vehicles traded in under the program will be crushed or shredded. Some parts of the vehicle can be recycled, but not the engine or drivetrain, with exemptions for vehicles 1985 and older to safeguard collector vehicles for hobbyists.
The CARS Act will make transactions on or after July 1, 2009 potentially eligible for credits under the program, which is expected to be fully in place around July 23 once issues that must be addressed in the implementing regulations are resolved and NHTSA passes a final rule.
The controversial bill was signed into law by President Obama following its passage through the House of Representatives and the Senate.
The program is similar to those implemented in several other countries, including Germany, which reported a 39.7 per cent rise in new-vehicle sales attributed to the fleet renewal scheme.
For more information on the program, visit.