From Harkin's office:
Harkin, DURBIN push MEASURE That Would Spur Demand for American Cars
Legislation would provide buyers with a trade-in a $10,000 credit towards purchase of a new car
WASHINGTON, D.C. – Senators Tom Harkin (D-IA) and Dick Durbin (D-IL) introduced a bill today that would help American automakers sell their cars to individuals and families with lower incomes and take older, less fuel-efficient cars off the road. The Sell Fuel Efficient Cars Act would provide a rebate of $10,000 to buyers who trade in a car more than ten years old for a new American car.
“A critical component is missing from the bridge loans for the Big Three automakers – reasons for Americans to buy American cars. This bill is designed to create demand for cars, help preserve jobs, and create profits for the car companies,” said Harkin. “It will also jump-start the nationwide transition to more fuel efficient vehicles and take polluting older cars off the road. If we can help the auto companies put their future back on track, we can certainly also help regular folks buy a more fuel efficient vehicle. ”
"Anyone who filled up their tank when gas prices were hovering around $4 a barrel knows that we must make the transition to more fuel efficient vehicles," said Durbin. "This bill helps consumers by offering them a good deal on an American-made car, it helps the American automakers by creating a demand for their products and we all benefit from having more fuel efficient cars on the road."
Eligibility for the rebate would be limited to families with an adjusted gross income below $40,000 on their prior year’s income tax return, or individuals with an adjusted gross income below $25,000. There would be a one car limit per individual or family and the program would expire in 2009.
Those who are eligible would be required to trade in a car that is over 10 years old and still operational. The rebate must be used to purchase a new, fuel-efficient GM, Ford or Chrysler car assembled in the United States.
The car must have an average fuel economy above 25 miles per gallon measured under the stricter five cycle EPA standard, and more than five miles per gallon better than the trade-in.
Nearly 17 percent of automobiles made by the Big Three would qualify for this standard. But, that percentage could significantly rise if smaller engines were chosen for some models and people chose more fuel efficient vehicles.