By Peter Whoriskey
Washington Post Staff Writer
Saturday, August 15, 2009
The biggest single beneficiary of the $3 billion "Cash for Clunkers" government program so far is the Japanese automaker Toyota, according to federal figures released Friday.
Three of the five most popular vehicles purchased under the program are Toyota models: the Corolla (No. 1), the Camry (4) and the Prius (5).
Controversy over the program has focused in part on how much of the U.S. tax money will go toward stimulating business for foreign automakers.
Halfway through the program, Toyota is getting the largest share of the new purchases under the program with 19 percent, according to the figures released Friday by the National Highway Traffic Safety Administration.
Two U.S. automakers follow closely behind Toyota, however, with General Motors at 18 percent and Ford at 15 percent of the new business. And about 54 percent of top 10 models purchased under the program are manufactured in the United States, according to the figures. The Corolla, Camry and the Honda CR-V 4WD are all manufactured domestically.
"I've always been confused by the 'Buy America' thing when there are plenty of Hondas built in Atlanta," said Neil Kopit, director of marketing at Criswell Automotive which owns Chevrolet, Nissan, Honda and Hummer dealerships in Maryland. "There is a profit leaving and going overseas. But who is it enriching before it goes there? The dealers and the salespeople and the mechanics all live and work in the community."
Designed to revive the economy by stimulating auto sales, the Cash for Clunkers program offers the owners of older cars $3,500 or $4,500 if they turn in their vehicles and buy a new, more fuel-efficient ride.
An initial version of the legislation, introduced by Rep. Betty Sutton (D-Ohio), limited the new purchases to vehicles built in North America. That way, the spending would directly benefit U.S. workers. But critics said the restriction violated trade law.
"To avoid any kind of complications with the World Trade Organization, we made adjustments that allowed our companies to robustly compete, and they are, as the new figures show," Sutton said Friday. "The majority of cars being purchased are being built in the United States. This is an unmitigated success."
So far, more than 350,000 vehicles have been purchased under the program and about half of the $3 billion budget has been spent, according to the new figures.
The average fuel economy of the cars being traded in is 15.8 miles per gallon and that of the new cars replacing them is 25 mpg.
The program has led many car buyers to downsize their vehicles, with about half of the nearly 300,000 people turning in SUVs, minivans, pickups and other trucks for a car.
The new vehicles being purchased are 19 percent more efficient than new cars currently available, according to the federal figures.
"It's quite a revelation to see consumers moving in droves from trucks to high-efficiency cars -- it's just not something the auto industry has led us to believe is possible," said Therese Langer, transportation director at the American Council for an Energy-Efficient Economy.