‘Cash for Clunkers’ Yielded Almost 700,000 Sales

[Purveyor]

By Angela Greiling Keane

Aug. 26 (Bloomberg) -- The U.S. government’s “cash for clunkers” vehicle trade-in program produced almost 700,000 automobile sales, the Transportation Department said.

Rebate applications valued at $2.88 billion were submitted by the deadline, the department said today in a statement. The program, which offered buyers discounts of as much as $4,500 to trade in older cars and trucks for new, more fuel-efficient vehicles, ended Aug. 24. The government granted dealers an extra day to file repayment applications.

The initiative helped restore demand for the slumping auto industry, prompting General Motors Co., Ford Motor Co. and Chrysler Group LLC to boost production plans in the second half of the year. While sales are likely to fall to a “more sustainable level,” any offsetting effect on U.S. growth in future years is expected to be “gradual,” the White House Council of Economic Advisers said this week.

“This is a win for the economy, a win for the environment and a win for American consumers,” Transportation Secretary Ray LaHood said in the statement.

Dearborn, Michigan-based Ford’s Focus was the only vehicle made by a U.S.-based company among the top five purchased under the program. The others are Toyota Motor Corp.’s Corolla and Camry, Tokyo-based Honda Motor Co.’s Civic and the Elantra, made by Hyundai Motor Co. of Seoul.

The average fuel economy of the vehicles traded in was 15.8 miles per gallon and the average fuel economy of vehicles purchased is 24.9 mpg -- a 58 percent improvement, the Transportation Department said.

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BLOOMBERG: http://www.bloomberg.com/apps/news?pid=20601087&sid=ac0DtJxyfA.g