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Government To Purchase 17,600 Cars To Help Auto Industry

April 10, 2009

In hopes of creating a strong U.S. auto industry, President Barack Obama announced on Thursday the government would buy 17,600 new fuel-efficient vehicles from ailing American automakers by June 1, Reuters reported.

All of the automobiles of the U.S. government fleet will be purchased from General Motors, Chrysler and Ford, all of which had an existing contract with the federal government’s General Services Administration.

The GSA is set to spend about $285 million in funds from the $787 billion dollar Recovery Act approved by Congress earlier this year to buy the 17,600 commercially available fuel-efficient vehicles, Obama said.

The President released an official statement following the decision: “As a part of our commitment to the American auto industry, I charged my administration with using Recovery Act funds to purchase a new fleet of fuel-efficient government vehicles to increase demand for our American auto companies and stimulate the economy.”

Obama said the move would only be a first step, but he would continue to ensure that the government is working to support the American auto industry during such a difficult period of restructuring.

The Obama administration directed automakers to speed up planned purchases of vehicles for the U.S. government’s fleet of cars.

The White House said the plan would include the purchase of 2,500 hybrid sedans that will be ordered by April 15, the largest one-time purchase of hybrid vehicles for the government fleet in history.

The administration noted that swapping older federal cars for hybrids and fuel-efficient vehicles would reduce gasoline consumption by 1.3 million gallons per year and cut carbon dioxide emissions by 26 million pounds.

Some $15 million was set aside by the GSA to buy advanced technology vehicles for the government fleet, including compressed natural gas and hybrid buses as well as electric vehicles.

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