Transportation | July 31, 2009 |
Cash for Clunkers Omits Conversion Option
With sales up at Ford and at other dealerships, the program can be viewed as an unabashed success for the auto industry. And the environment is also winning, as the vehicles being purchased are estimated to be 69 percent more fuel efficient than the vehicles being dumped, according to the website CashForClunkersInformation.org.
On average consumers will save $750 per year on gasoline, which will offset a few of the car payments for their new vehicles. About 70 percent of the cars being traded in were from U.S. car companies, and almost three-quarters of the vehicles were SUVs, vans, or pickups.
But the trade-in program has 2 flaws that should prompt legislators from a knee-jerk reaction to extend the program. First, while the vehicles will be recycled, it still wastes much of the value of functional vehicles. It will take a lot of energy to put the metal and other parts back into use, and most of the components will go for naught.
Many of the newer models being traded in could have been converted to run on natural gas or ethanol, which could reduce emissions to an even greater degree than a few MPG extra without wasting the vehicles. Shouldn't any program aimed at boosting the environment and economy also consider conversion companies or component suppliers, who are also hurting these days?
Also, hybrid vehicles can be converted to plug-ins for not much more than the $4,500 that some folks are getting for dumping a clunker. PHEV conversions would save emissions and reduce foreign oil dependence to a much greater degree than upgrading someone's clunker to a 25 mpg car.
Taking a breath before resuming funding to consider all of the options would make sense, but it's not likely to happen.
Update: The Renewable Fuels Association is not happy that money from the renewable energy loan program is being shifted by the House to the C4C program. Bob Dinneen, President and CEO of the RFA issued the following statement:
“The ethanol industry understands the trying economic times this country finds itself in and thus supports ideas like the “Cash for Clunkers” program, but is concerned to see the program paid for by depleting the renewable energy loan guarantee program. We hope Congress will move quickly to replenish the fund. One of the advantages of the “Cash for Clunkers” program is putting more fuel efficient cars on the road, however those new cars should also be running on renewable fuels like ethanol in order to benefit both the changing climate and the domestic economy. For the U.S. long term auto and fuel needs, it seems counterproductive to limit the renewable fuels industry.”