Cash For Clunker Incentives Plan to Vote Today by Senate

The U.S. Senate may vote today on competing plans to boost U.S. auto sales by paying owners to crush old, inefficient models.

The plan spearheaded by Sen. Debbie Stabenow, D-Mich., has the backing of automakers, dealers and President Barack Obama. But a competing proposal from Sen. Dianne Feinstein, D-Calif., would set tougher mileage standards after complaints from environmental groups that the consensus plan won't save enough fuel.

Following another month of weak sales, and forecasts for sales of only 10 million new cars and trucks this year, automakers and their allies on Capitol Hill have pressed Congress to act quickly.

"It's critical that we pass this," Stabenow said Tuesday. "This is an opportunity to immediately stimulate auto sales across the country."

Under the Stabenow plan, owners of cars and trucks that get less than 18 m.p.g. could get a voucher of $3,500 to $4,500 for a new vehicle, depending on the mileage of the new model. The voucher would replace any trade-in value, since the old model would be scrapped.

Backers say the compromise would cost about $4 billion -- paid for with money from the economic stimulus plan passed earlier this year -- and could boost sales by 1.3 million vehicles over a year, according to industry officials.

But critics note that the plan favors owners of trucks over cars: even 15 years ago, only five models of midsize sedans managed just 18 m.p.g.

The Feinstein plan would add a $2,500 voucher, require old models to get less than 17 m.p.g., and require larger mileage improvements for the larger voucher. It would also offer a $1,000 voucher for buying efficient used models.

+ "Cash for Clunkers' Incentives Program to Buy New Car
+ Cash-For-Clunkers: Pickup Trucks Buyer to Be Winners

The U.S. Chamber of Commerce backed the Stabenow bill in a letter to Congress on Tuesday, saying it would offer the best mix of economic and environmental benefits.

Stabenow offered the plan as an amendment to a Senate bill setting new controls on tobacco products. It wasn't clear Tuesday evening when Feinstein might offer her plan.