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Press Release

For Immediate Release
Contact:
Sean C. Bonyun
August 11, 2009
(202) 225-3761

Upton Hails Cash for Clunkers Benefits to Michigan Economy
Production lines are set to increase operations to meet demand triggered by Cash for Clunkers

WASHINGTON, DC – Congressman Fred Upton (R-St. Joseph), co-chair of the Congressional Auto Caucus, today visited car dealerships in Bridgman and Vicksburg to discuss the progress of the “Cash for Clunkers” program since it was replenished with an additional $2 billion last Friday. Although the “Cash for Clunkers” program was authorized for $4 billion, only $1 billion had been appropriated, and that amount had been quickly exhausted. The House passed emergency legislation July 31st and the Senate followed suit on August 6th. The program has been especially critical to Michigan’s economy, as of August 4th, Michigan auto dealers were leading the nation in program participation, taking advantage of $44.4 million in vouchers.

“‘Cash for Clunkers’ is fostering activity on the production side in the auto industry that we have not seen for some time – from assembly plants on down to the parts suppliers that dot southwest Michigan, production orders are up and folks are going back to work,” said Upton. “People across America are flooding dealer showrooms to take advantage of the successful program. In just two weeks, the shockwave through Michigan’s economy from ‘Cash for Clunkers’ has been remarkable. Folks would much rather be working and paying taxes than be unemployed and drawing benefits, and this program is providing new employment opportunities at a time when we need help the most.”

It has been reported that Chrysler has added shifts and overtime at some of its plants and General Motors has indicated that it is likely to increase production. According to the U.S. Department of Transportation, more than $1.15 billion has already been paid out to cover the 273,000 vehicles that have been traded-in under the program.

Yesterday, Upton joined with Rep. Candice Miller (R-MI) in urging the Secretary of Transportation to address the problem of dealers running out of inventory as a result of the program, and the lag in getting that inventory replenished because of the slow-down in manufacturing. Currently, a VIN number is required for a deal to take place under the program, which is not assigned to a car until production begins. This prevents buyers from ordering cars through dealers. As inventory dwindles, this becomes a bigger problem for dealers, especially small ones.

Upton and Miller wrote, “In this program’s short duration, the vehicle supplies of the three Detroit automakers have been already been cut by 2 ½ weeks. Certain vehicles that have proven to be extremely popular for new purchases under this program are quickly becoming scarce….We would ask that the National Highway Traffic Safety Administration (NHTSA) consider modifying the Car Allowance Rebate System to allow purchasers to reserve a voucher for a newly-ordered vehicle from an automobile manufacturer. This will allow consumers to purchase the vehicle they want, even if it is not presently on the dealer’s lot.”

View Upton and Miller’s letter [PDF].

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