Stimulus Keeps America Motoring
Private cars are not going anywhere anytime soon but I like to see policies designed to take away the massive advantage the car has over say mass transit.
Stimulus funds, as we know, are going toward many road projects. Yes, the road projects were “shovel ready” but only because that is all we seem to plan for.
The cash for clunkers program (officially the car allowance rebate system) has been well received:
According to a survey of car dealerships and 2,200 consumers by CNW Research, the average fuel economy of vehicles traded in last week was 16.3 miles a gallon, which is not much less than the 18 m.p.g. needed to qualify for a government rebate of $3,500.
The relatively small differential suggests that consumers have not been turning in the oldest, dirtiest and least fuel-efficient cars, but instead have been getting rid of their second and third cars, according to Art Spinella, who ran the survey.
The vehicles that consumers bought with their credits had average fuel efficiency ratings of 24.8 miles a gallon, he said.
Lawmakers hoped the cash for clunkers program, formally known as the Car Allowance Rebate System, would reduce America’s dependency on imported oil. But the early results of the program suggest that may not happen. The vehicles turned in were driven about 6,000 miles a year, he said. If the new vehicles are driven about 12,000 miles a year, the rough annual average, then consumers will actually use more fuel, not less.
“The energy independence argument did not ring true, at least so far,†Mr. Spinella said. (source)
There is much debate about the program. True, 2nd & 3rd cars are used as the trade in vehicle.  The new car will become the primary vehicle and the old primary vehicle will become the new secondary car in the household.
Some say the fuel efficiency requirements should have been higher. I agree. My guess is if they had been too high many of the new vehicles would have been foreign rather than domestic makes. Domestic makers simply focused too heavily on trucks & SUVs.
My 2004 Toyota Carolla, built in California, has a combined EPA of 28mpg. It is worth more than the rebate anyway. A 1994 Carolla still wouldn’t have qualified due to a combined EPA of 25mpg.
I looked up many other cars at fueleconomy.gov to see if they qualifed based on MPG. A 1994 Ford Crown Victoria just barely qualifies but a 1994 Ford Taurus does not. On one hand I’d like to see 20mpg cars be replaced with 30mpg vehicles. On the other you have to draw a line somewhere.
And clearly there has been no shortage of qualifying trade ins. You have to wonder if buyers are going to cheap used car lots to purchase a $1,000 clunker so they’d have a vehicle to qualify for the $4,500 rebate?
The clunker program is certainly a fast way to stimulate the economy. But it also shows how important the auto industry is to our economy. How will we ever change that fact?
At one time the St. Louis we made streetcars used by many cities. No reason why the shuttered Chrysler plant in Fenton couldn’t build modern low-floor streetcars for use in the Loop Trolley line and in many others. Someone has to build the trains for the high-speed rail lines being planned in the US.
Stimulus money needs to make it easier to use our private cars less often. Where is the rebate for trading in a clunker and buying a 90mpg scooter as a replacement? Or a 10-year transit pass?
– Steve Patterson
