SEMA Urges President Obama to Oppose Vehicle Scrappage Programs

FOR IMMEDIATE RELEASE

Media Contact:Della Domingo
SEMA 909/396-0289, ext. 130
dellad@sema.org

SEMA Urges President Obama to Oppose Vehicle Scrappage Programs

WASHINGTON, D.C. (April 1, 2009) – In a letter to President Barack Obama, the Specialty Equipment Market Association (SEMA) applauded recent initiatives by the Administration to rebuild the U.S. auto industry, but opposed inclusion of a vehicle scrappage program as part of the solution.  The letter was also sent to the leadership of both parties in the U.S. Congress along with the Congressional Automotive Caucus.  In February, Congress expressly rejected vehicle scrappage when it passed the economic stimulus bill last February.

Scrappage programs accelerate the demise of older vehicles which are then typically crushed into blocks of metal.  Sometimes referred to as “cash for clunkers,” the programs focus on a car's age or fuel efficiency rating rather than its actual emissions or how much it is driven.  

“SEMA has consistently warned against wasting taxpayer dollars on a program that may produce an artificial spike in sales, but does not reduce emissions or increase fuel efficiency.  We encourage you to help the entire auto industry with programs that focus the incentive where it counts – on the purchase of new vehicles and not destroying older cars,” wrote Chris Kersting, SEMA’s President & CEO.  

In the letter to the President, SEMA discussed the need to help consumers, automakers and dealerships with a program to stimulate new car sales.  The association supports the Administration’s plan to assist consumers with government–issued vouchers toward the purchase of fuel-efficient new vehicles.  In addition, SEMA urges the government to allow consumers to deduct the car interest payments on their taxes.  

The letter also addressed environmental arguments put forth to justify scrappage programs.  “While supporters tout a similar German program as evidence of success, the European Federation for Transport and the Environment has urged Germany and other countries to abandon scrappage subsidies because they do more environmental harm than good by artificially accelerating the car life cycle.”  

Under the proposed scrappage program, millions of consumers who may be eager and able to purchase a new car but don’t have an eligible older car to trade would be denied access to the vouchers.  SEMA also noted that someone who owns just one older car does not normally purchase a new car.  However, people who own two or three cars may take advantage of the taxpayer give-away.  Many of these cars are infrequently driven, if at all, so destroying them will not clean the nation’s air or make us less dependent on foreign oil.  

“Cash for Clunkers will hurt thousands of Americans working for independent repair, restoration and customization shops across the country, while reducing the number of vehicles available for low-income individuals and driving up the cost of the remaining used cars and parts,” said Chris Kersting.  “It is time to help the entire auto industry by creating incentives for all that will increase vehicle sales.  Leave the valuable and affordable older cars available to those who need and appreciate them.”

ABOUT SEMA

SEMA represents the $38.1 billion specialty automotive industry.  Founded in 1963, the trade association has 7,358 member companies.  It is the authoritative source of research data, trends and market growth information for automakers and the specialty auto products industry. The industry provides appearance, performance, comfort, convenience and technology products for passenger cars, minivans, trucks, SUVs, crossovers and recreational vehicles. For more information, contact SEMA at 1575 S. Valley Vista Dr., Diamond Bar, CA, 91765-3914; call 909/396-0289; or visit www.sema.org or www.enjoythedrive.com.

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