American steel firms anticipate increased demand from “Cash for Clunkers”

Leading US minimill Nucor Corp. CEO Dan DiMicco told Reuters Wednesday that he anticipates the federal "Cash for Clunkers" program –- officially the Car Allowance Rebate System or CARS -- to stimulate automobile sales and thus have a positive impact on US steel demand.

DiMicco said that while the firm hasn't seen the program result in new steel orders just yet, he expects to see an up-tick in orders within the next couple months as a result of the program's stimulative effect on new automobile sales.

Schnitzer Steel, a scrap recycler, used auto parts dealer and steel manufacturer, also anticipates an increase in business resulting from CARS, as its integrated business segments put the firm in a unique position to benefit from the program. Schnitzer reported this week that its “Clunkers Recycling Dealer Program” has gained a significant positive response from new car dealerships receiving trade-ins of “clunker” vehicles through the implementation of CARS. Schnitzer says hundreds of new car dealerships have registered with Schnitzer's program, with an expectation of more to come.

Under Schnitzer’s Clunkers Recycling Dealer Program, Schnitzer will provide dealerships an immediate quote for their “clunker” that is guaranteed for 15 business days and provide a certificate of destruction, free towing services, and quick payment.

Tom Klauer, President of Schnitzer’s Auto Parts Business, said, “Schnitzer is a large, well-established and trusted partner to the industry and the only vertically integrated auto recycling company that can handle the Clunkers across broad geographic reaches of the US.”

The Senate is expected to vote Thursday evening on whether to provide an additional $2 billion in funding for CARS, which would keep the program going through Labor Day.