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Senate reaches deal on $2B 'clunkers' refill

WASHINGTON (AP) - The Senate reached a deal on saving the
dwindling "cash for clunkers" program late Wednesday, agreeing to
vote on a plan that would add $2 billion to the popular rebate
program and give car shoppers until Labor Day to trade in their
gas-guzzlers for a new ride.

Following lengthy negotiations, Senate Majority Leader Harry
Reid said Democrats and Republicans had agreed to vote on the plan
Thursday, along with a series of potential changes to the bill,
which was passed by the House last week. Reid has said Democrats
have enough votes to approve the measure and reject any changes
that would cause an interruption in the rebates of up to $4,500.

Reid said the agreement "accomplishes what we need to
accomplish."

Late Wednesday, it was not clear that any of the proposed
amendments stood a chance of passing. Some of them included placing
an income limit on those benefiting from the vouchers and requiring
the government to sell off its stakes in General Motors Co. and
Chrysler Group LLC.

Any Senate changes to the bill would require another vote in the
House, something that couldn't take place until the House returns
in September from a monthlong recess.

The government said Wednesday that more than $775 million of the
$1 billion fund had been spent, accounting for nearly 185,000 new
vehicles sold. President Barack Obama has said the program would go
broke by Friday if not replenished by Congress.

Administration officials have estimated the additional $2
billion could fund another 500,000 vehicle sales and last into
Labor Day.

That's the same day the Senate was to follow the House into the
August recess, a looming break that Senate leaders often use to
prod their colleagues past standoffs.

"We all acknowledge there's a significant majority that want to
move forward with this legislation," Reid, D-Nev., said earlier in
the day, adding that he has the votes to approve the House-passed
version as is.

His Republican counterpart, Sen. Mitch McConnell of Kentucky,
concurred that the matter would be settled soon. And objectors
conceded they do not have the votes to force all of the changes
they want, or to block the House version of the bill.

"My guess is, at the end of the day, it will pass," said Sen.
John Thune, R-S.D., who called it an example of "Congress choosing
winners and losers among industries."

The program offers car buyers rebates of between $3,500 and
$4,500 for trading in their gas-guzzlers for new, higher-mileage
models.

The new funding would triple the cost of $1 billion rebate
program and give as many as a half-million more Americans the
chance to grab the new car incentives through September.

Car companies have credited the clunkers program with driving up
sales in late July. Most consumers are buying smaller, more
fuel-efficient vehicles under the program, according to a list of
the top-10 selling cars released Wednesday by the National Highway
Traffic Safety Administration.

Among manufacturers, General Motors Co. had the largest share,
accounting for 18.7 percent of new sales, followed by Toyota Motor
Corp. with 17.9 percent. Ford Motor Co. was third with 16 percent
of the sales. Detroit automakers represented 45.3 percent of the
total sales while Japan's Toyota, Honda Motor Co. and Nissan Motor
Co. accounted for 36.5 percent.

The Toyota Corolla is the top-selling vehicle on the list,
followed by the Ford Focus, Honda Civic, Toyota Prius and the
Toyota Camry. There is one SUV on the list, the Ford Escape, which
also comes in a hybrid model that can get up to 32 miles per
gallon. Six of the top-10 selling vehicles are built by foreign
manufacturers, but most are built in North America.

Among states, Michigan has taken most advantage of the program,
requesting more than $44 million in vehicle vouchers. California
dealers had requested nearly $40 million in vouchers, and Ohio had
sought nearly $38 million.

Senate passage would send the legislation to the White House for
Obama's signature and assure consumers there will be no
interruption in the program that has led to packed car dealerships
nationwide.

The deals are aimed at boosting auto sales, which have been at
their lowest levels in two decades.

(Copyright 2009 by The Associated Press. All Rights Reserved.)


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