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Cash for Clunkers: Automakers (and the Environment) Benefit

The Alliance of Automobile Manufacturers is very positive about the "Cash for Clunkers" (CARS) legislation, and for good reason: It is not only stimulating sales, but also getting people thinking about buying cars again. Especially clean ones: Results so far show a clear shift from gas-guzzlers to smaller cars.

According to the Alliance, Ford reports an average nine-mpg increase from trade-in to new cars under the program. GM has seen a 54 percent increase in small car sales in the week since the program was launched. The fuel-efficient Mazda3 was the most popular of the company's cars--57 percent of the total--to benefit from the program.

At Toyota, people traded up to such new cars as the Corolla, Prius, Camry, RAV4 and Tacoma--averaging a combined 30 mpg (the Corolla and Prius together average 39.5 mpg). Some 70 percent of Toyota's trade-ins are gas-guzzling vans, trucks and SUVs. VW has seen 60 percent of CARS customers buying clean diesel TDIs (34 mpg combined).

If half of CARS buyers got the four-mpg discount and the other half the 10-mpg, then the program saves 45 million gallons of gasoline a year (and an average savings among all the participants of $450 a year). Carbon dioxide emissions go down 500,000 tons.

The impact could have been even greater. Edmunds.com says that as many as 100,000 consumers waited for the program to go into effect, which is one reason why it ran out of money so fast. The site also said that, on any given month, 60,000 people trade in clunkers without any government money.

Alliance spokesman Charles Territo says, "Automakers hope that once Senators have an opportunity to see how this program is benefitting the environment and the economy, they will provide additional funding. He describes it as "a win-win-win-win; for the economy, for the environment, for energy security and most importantly for consumers."

Photo: Flickr/Bcostin