US Cash for Clunkers starts July 23

The US’s new Cash for Clunkers law comes into effect from July 23, encouraging Americans to trade in their old cars for newer, more efficient and less polluting models at a sizeable discount.

The introduction of the scheme, which was passed by President Barack Obama earlier this month, follows similar initiatives in the UK and Europe.

The new law could also help stimulate sales of vehicles in the US. The American auto industry has been hit hard by the global economic downturn.

Under the new legislation, dealers will be able to decide which vehicles are eligible and will take charge of scrapping the older vehicles.

To qualify for the scheme, old cars must not be older than 25 years and must have been owned for one year. Motorists will get up to $4,500 towards the purchase of a new vehicle. The full amount will go to those that plump for cars at least 10mpg more fuel efficient than the model they replace (5mpg for trucks).

The final details are being worked out by the US’ National Highway Transport Safety Administration.

Do you think such a scheme could work in the Middle East? Have your say by commenting below.