Americans are lining up to snap up rebates for "cash for refrigerators" and "dollars for dishwashers," as part of a US government program aimed at both economic stimulus and reduced emissions. The effort, modeled after the "cash for clunkers" auto trade-in program, includes nearly 300 million dollars to encourage consumers to dump older appliances in favour of newer, energy-efficient models.
US officials say the effort, a small part of the nearly 800-billion-dollar economic stimulus measure enacted last year, will help reduce the US carbon footprint because of the heavy electrical consumption of big appliances, and at the same time pump money into the economy that can create jobs. One one level, the program, which is being administered by individual states, appears to be succeeding in jump-starting sales.
In Iowa, which offered rebates up to 500 dollars on refrigerators, washing machines and dishwashers, the 2.7 million dollars in federal funds was exhausted in less than a day by stampeding consumers. Minnesota needed less than three days to give out five million dollars in appliance rebates.
In Ohio, which launched its program Friday with 10.5 million dollars, the state agency administering it said it "anticipates the rebates will be exhausted in a few weeks." As of this week, New York still had 5.6 million dollars remaining from its 18.7 million dollars even though some waited in line on the opening weekend. "It's been a boon to consumers and retailers," said Francis Murray of the New York State Energy and Research Development Authority.
The biggest of the state programs will be launched in California April 22, with 35.2 million dollars. And more states will be launching rebate programs in the coming months. To qualify for rebates, consumers must buy appliances which meet energy standards set by the federal government and are up to 30 percent more efficient than existing models. Some states are offering extra rebates if consumers recycle old appliances. Some see the program as a natural follow-up to the "clunkers" program, which boosted new car sales, and in turn lifted auto production and jobs to help pull the US economy out of its slump.
Economist Ryan Sweet at Moody's Economy.com said the appliance program probably had an impact on sales and orders for durable goods, big-ticket items expected to last at least three years that are critical to the manufacturing sector.
"Eight states launched rebate programs last month, which would help explain some of the strength in sales at both electronic and building material stores," he said. "This also argues for strong gains in subsequent months and lends some upside risk to our forecast for real durables spending."