As the Senate considers all parts of the $800 billion economic stimulus bill, the proposal to help increase U.S. auto sales has been pulled from it.
Even though President Barack Obama fully endorsed the $16 billion amendment, Iowa Sen. Thomas Harkin, a Democrat, pulled it from the stimulus package. Harkin said he would postpone the "cash for clunkers" proposal, which had strong support from U.S. automakers, reports Reuters.
The amendment would have provided $16 billion in rebates to buyers of new fuel efficient vehicles who traded in their older gas guzzlers. Vehicles would have to be assembled in the U.S.
The Senate is still considering a $600 million plan for the government to purchase tens of thousands of fuel efficient vehicles to replace inefficient models in the fleet as part of the stimulus bill.
Now with no direct government rebate incentive to buy a car, manufacturers are going to have to offer some amazing deals that make buyers say “this is such a great deal that I must buy a car now!”