‘Cash for Clunkers’ pulled from stimulus

An amendment to spend $16 billion to encourage buyers to purchase new, fuel efficient autos was pulled from the bill.

WASHINGTON (Reuters) — One proposal to help jump start U.S. auto sales was withdrawn late Thursday and the fate of another was unclear, despite a vigorous endorsement from President Barack Obama, as Senate consideration of economic stimulus legislation accelerated.

Sen. Thomas Harkin, an Iowa Democrat, pulled an amendment that would have provided $16 billion in rebates to buyers of new fuel efficient vehicles who traded in their old, poor performing models.


Harkin said he would defer the so-called “cash for clunkers” proposal, which had strong support from U.S. automakers.

Lobbyists for those companies this week called it a genuine stimulus for a depressed market. U.S. auto sales plunged to a 26-year low in January.

There was no backing, however, for the plan from foreign manufacturers whose operations are clustered in states represented by conservative Republicans.

CNN