The Senate "will pass" an additional $2 billion to keep the government’s cash for clunkers, or CARS, program going before leaving for its recess this week, Senate Majority Leader Harry Reid said Tuesday.
The rebate program has practically run out of money in the first week of operation. The House passed the $2 billion in extra funds Friday, The Detroit News reports. The additional money would continue the program at least through Labor Day, Transportation Secretary Ray LaHood said.
“This program is going forward,” LaHood said. “We have enough money to continue. We encourage people to continue going into showrooms. … The money will be there to be reimbursed by the dealer. And I believe the Senate will pass $2 billion.”
The fuel-efficient Toyota Corolla is the second best-selling car in the cash for clunkers program.
GM Spokesman John McDonald said, “We are starting to ramp production back up as demand builds into the system, not only because of ‘cash for clunkers,’ but as the economy starts to recover and demand starts to build.”
Auto industry analysts have been saying for months that there was a huge amount of pent-up demand to buy a vehicle. The $3,500 to $4,500 rebate given to consumers who trade-in a clunker for a new, fuel-efficient vehicle seems to have pulled some unsure buyers over the fence and into dealer showrooms.
Will Americans continue to buy new and used cars after the CARS program ends? Even without the $4,500 incentive, automakers are still giving big discounts and incentives to buy right now.
What do you think? Are people only buying new cars right now because of the government rebate? Let us know by leaving a comment below.