Congress is once again kicking around the idea of giving people an incentive to trade in their old car or truck for a newer, more fuel efficient model. It's an idea that has sparked demand for new cars in other countries around the world. And frankly, it is one of the few incentive programs that is a win/win situation.
Here's how the proposal from Representative Betty Sutton of Ohio would work.
If you are driving a vehicle at least eight years old, you would have to trade that in and buy a vehicle that is more fuel efficient and costs $35,000 or less. Depending on the type of new car you buy, you would be eligible for thousands of dollars. For example, buyers of vehicle assembled in the U.S. could get a voucher worth up to $5,000 compared to a check totaling up to $4,000 for those built in North America, outside the U.S. If you bought a car made outside North America, you could not collect a voucher.
Starting in 2010, if you buy a plug-in electric hybrid that gets 100 mpg or more, you could collect a $7,500 voucher.
I think these programs are a win/win/win for buyers, auto makers, and the environment.
* Buyers will get a sizable voucher to upgrade their vehicle into a ride that gets better mileage and provides better performance.
* Auto makers and dealers would benefit from greater demand that is desperately needed right now.
* The environment will be helped by the potential for thousands of less efficient models being taken off the road. Yes, I know that those models traded in could be re-sold and would not get trashed, but the would eventually replace other older models, so eventually there is a benefit.
This is not the first "cash for clunker" proposal that we've seen thrown out in Washington, and it may die before Congress can approve it. Still, it is smart way of helping the auto industry while also providing a spark to consumers.
Click on Ticker to Track Corporate News:
- Ford Motor
- General Motors
- Toyota Motor
- Honda Motor
Questions? Comments? BehindTheWheel@cnbc.com