The Automotive Aftermarket Industry In Opposition To Federal Vehicle Scrappage Legislation

WASHINGTON, May 15, 2003 -- Representatives of the automotive aftermarket industry vow to fight federal funding of old vehicle scrappage ("car crusher") programs included in the U.S. Department of Transportation's "Safe and Flexible Transportation Efficiency Act of 2003" (SAFETEA) which was released yesterday.

Title I, Section 1601 of the SAFETEA would reverse a long-standing prohibition on federal funding of state-run vehicle scrappage plans through the Congestion Mitigation and Air Quality Improvement Program (CMAQ), administered by the Federal Highway Administration. In this case, U.S. taxpayer dollars would be used to purchase and crush cars made in 1979 and before.

Scrappage will not achieve its intended goal of improving air quality, but it will damage automotive aftermarket businesses and eliminate American jobs.

Under the ill-conceived program, states would use federal CMAQ funds to turn pre-1980 vehicles into blocks of scrap metal. "Classic" or "parts cars" would not be spared from the crusher. Salvageable used parts would be lost rather than being rebuilt and reused to keep other vehicles running.

In reality, the federal dollars would likely purchase 24+ years old cars that are not frequently driven. The program would also have a disproportionately adverse effect on lower and fixed-income Americans who depend on older vehicles and their replacement parts for daily transportation.

In addition, there is no guarantee scrapped vehicles would be replaced by cleaner running or more fuel-efficient models. Scrappage programs typically offer owners who surrender vehicles for crushing a cash payment towards the purchase of another vehicle. However, the payment hardly is enough to cover the cost of even a down payment on a newer used car; and there is nothing to prevent someone from receiving payment for scrapping a clean-running and fuel- efficient 1979 compact car and replacing it with a potentially more-polluting, and likely less fuel-efficient light truck or SUV.

"Old car" scrappage programs sound good but they don't work. Congress has abandoned at least nine such measures over the past decade once they became educated to the fact that scrappage programs are not cost-effective and do not positively impact air quality emissions. In addition, the automotive aftermarket industry's substantial experience with state-level scrappage proposals indicates that most states elect not to use or discontinue implementation of vehicle scrappage programs as a method for meeting air- quality goals based on their cost and failure to demonstrate real benefits.

The automotive aftermarket industry supports the nation's clean air goals. In fact, we manufacture, rebuild, market, retail, service and install products that produce cleaner emissions, and we are always looking for ways to improve these products and services. Federally funded scrappage programs will not improve air quality. They will, however, wreak havoc in the automotive aftermarket and cost American jobs.

This bulletin is written on behalf of the Alliance of Automotive Service Providers (AASP), Automatic Transmission Service Group (ATSG), Automotive Aftermarket Industry Association (AAIA), Automotive Engine Rebuilders Association (AERA), Automotive Parts Rebuilders Association (APRA), Automotive Warehouse Distributors Association (AWDA), Production Engine Remanufacturers Association (PERA), SEMA, the Specialty Equipment Market Association, Service Stations Dealers of America and Allied Trades (SSDA-AT) and Tire Industry Association (TIA)

The automotive aftermarket is a nearly $250 billion industry which employs approximately four million Americans in all 50 states. It is comprised of independent businesses that manufacture, rebuild, distribute, retail and install vehicle parts and perform service on all types of motor vehicles, including the older vehicles this legislation targets. Vehicle owners throughout the United States depend daily on aftermarket parts and service.