The Specialty Equipment Market Association (SEMA), the Tire Industry Association (TIA) and five other automotive aftermarket trade associations have joined in opposing ``Cash for Clunkers'' legislation being considered in Congress.
Cash for Clunkers is the industry's term for a plan to use federal funds to purchase older, ostensibly heavier-polluting vehicles to get them off the road and serve as a catalyst to new car sales.
The trade groups initially banded together to oppose the idea being included in the federal economic stimulus package, and they were successful in that endeavor. Since then, however, more legislation along the same lines is being proposed.
The first bill, ``Sell Fuel Efficient Cars Act of 2008,'' was introduced in mid-December by Sens. Tom Harkin, D-Iowa, and Richard Durbin, D-Ill.
The second bill, ``Accelerated Retirement of Inefficient Vehicles Act,'' was introduced Jan. 14 in the Senate by Sens. Dianne Feinstein, D-Calif., Susan Collins, R-Maine, and Charles Schumer, D-N.Y., and in the House of Representatives by Reps. Steve Israel, D-N.Y., Jay Inslee, D-Wash., Barbara Lee, D-Calif., and Dennis Moore, D-Kan.
The latter bill would establish a national voucher program offering vehicle owners a credit of $2,500 to $4,500 to voluntarily trade in their older, less fuel-efficient car, truck or SUV for a more fuel-efficient vehicle, according to a press release from Ms. Feinstein's office. Traded-in vehicles would be scrapped.
The traded-in vehicles must have a fuel economy of no more than 18 miles per gallon, be in drivable condition and have been registered for at least the past 120 days. Fuel-efficient is defined as getting at least 25 percent better mileage for the corporate average fuel economy (CAFE) target for its class.
Vouchers also could be redeemed for transit fares for participating local public transportation agencies. The program would operate for four years, from 2009-12, and is expected to encourage the early retirement of up to 1 million vehicles per year, according to a press release from the trade groups.
The aftermarket groups assert in a joint letter to Congress there is no evidence that the program will achieve the stated goal of boosting new car sales, reducing emissions or cutting fuel consumption and instead could end up hurting lower income car owners and automotive aftermarket companies.
``Cash for Clunkers programs threaten jobs in the automotive aftermarket since they remove the opportunity to repair and upgrade existing cars and raise the price of used cars and parts,'' the seven groups said in the letter.
Alternatively, the associations are pledging support for legislation to provide tax incentives to purchase new cars such as allowing deductions for interest on car loans and state sales tax. The groups also support tax credits to help owners upgrade, repair or maintain an older vehicle.
In addition to TIA and SEMA, the trade groups that signed the letter are: Automotive Aftermarket Industry Association; Automotive Engine Rebuilders Association; Automotive Parts Remanufacturers Association; Automotive Warehouse Distributors Association; and Automotive Transmission Rebuilders Association.
These groups represent a segment of the economy they peg at being worth $258 billion in annual sales revenue and providing about 4.5 million jobs. Among the businesses affected would be those that make, rebuild, restore, customize, distribute, retail and install vehicle parts and perform service on all types of motor vehicles, including the older vehicles this legislation targets, SEMA said.
The cash for clunkers idea first got legs in July 2008 when it was proposed by Alan Blinder, a professor of economics and public affairs at Princeton University and former vice chairman of the Federal Reserve, in an op-ed piece in the New York Times.
The idea is supported by the Center for American Progress Action Fund, a progressive think tank ``dedicated to improving the lives of Americans through ideas and action.'' It is headed by John Podesta, a professor at Georgetown University Center of Law, former chief of staff to President Clinton and a co-chair of the Obama-Biden Transition Project.
Among the objections the aftermarket groups raise are:
* Clunker programs focus on a vehicle's age rather than a vehicle's emissions, based on the perception that all older cars are dirty cars. However, the groups point out, no actual emissions measurements are taken for cars that are scrapped.
* Clunker programs rarely capture the ``gross polluter,'' an improperly maintained vehicle of any model year, which puts out dramatically more emissions due to poor maintenance.
* Clunker programs diminish the availability of affordable transportation and repair parts to lower-income drivers as more and older cars are crushed.
Most lower-income individuals will not be able to afford to buy new vehicles, let alone more fuel-efficient or cleaner vehicles, with the money provided by clunker programs.
* Clunker programs compete with charitable organizations that rely on used car donation programs to fund their programs.
* Auto restoration, customization and repair shops nationwide will suffer with the loss of older cars, trucks and parts they need to supply and service their customers.
It also will reduce the supply, and therefore raise the price, of second- and third-hand cars and trucks often purchased by lower-income citizens.
* Cash for Clunkers programs risk destroying classic, historic and special interest vehicles.
* Clunker programs do not guarantee a scrapped vehicle will be replaced with a more fuel-efficient vehicle. In fact, many older vehicles get better fuel mileage than the newer models.
* Cars turned in for scrappage often are rarely driven second or third vehicles that have a minimal impact on overall fuel economy or emissions.
* There is no evidence that clunker programs boost demand for new vehicles, drive traffic to new car dealerships or create or retain jobs.