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Car Manufacturers Question Senate’s Scrap-loot Proposal

us senateCar importers question the US Senate’s proposal to give $10,000 credit to people who would hand over their old motor vehicles in exchange for newer, more fuel efficient models.

This proposal is tagged the Harkin-Stabenow amendment, and most US lawyers have reason to believe that it violates important aspects of the World Trade Organization rules, as well as the North American Free Trade Agreement

Car manufacturing and dealing companies are fearful about the effects of this move on the US economy. With the new amendment, there’s a big possibility that car sales will drop drastically this year. The US happens to hold a big chunk of the world’s car manufacturing industry.

The other side of the coin

On the plus side, a lot of environmentalists and households are excited about the immediate effect of this amendment. Most people refuse to hand-over their 10-year-old faithful for newer, cleaner models simply because they can’t afford to pay for a new car.

With the $10,000 credit aid from the government, a lot of US households may see the possibility of owning new hybrid cars. The environmentalist dream of saving what’s left of the ozone layer can be made real.

Executioner’s Alley

The amendment states that households wishing to get the rebate should trade in cars that are over 10 years old. The car also needs to be functional, meaning you can’t trade in mere scrap metal. You have to trade in a car that you obviously still drive around the city. In exchange for the $10,000 rebate, your old car will be demolished to make sure that it won’t be used again.

The Senate allocated $16 billion for this project—just enough to make the rebate possible until September 2010.


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