Apparently Cash For Refrigerators, Appliances Next

According to Business Week Cash for Appliances (also known Cash for Refrigerators) is a $300 million federal program, designed to promote energy efficient appliances. While the program brings hope to the stalled markets of washing machines and dishwashers, the 300 million dollars may not be enough to lift companies such as Whirlpool (WHR) and Electrolux out of a very low down cycle.

Cleveland based NewsNet5 reports that The Department of Energy is working with states to give out $300 million. The details of the program are still being worked out. We did a brief search in DOE's website and so far could not find any updated information about the details of Cash for Appliances program. The Association Of Home Appliance Manufacturers also has no update on its website. However, according to the association's information the shipments of washers, dryers, refrigerators, and ovens dropped 10% in 2008 and are down 15% through July.

The Cash For Appliances program is part of Obama's $787bn package to stimulate the US economy and, in an interview on Thursday, he said it had been "successful beyond anybody's imagination."

According to Guardian, the program is expected to work through rebates. Consumers will receive cash rebates of $50 to $200 for their old refrigerators, driers, washing machines and other appliances to replace them with more energy efficient machines. However, in the case of Cash for Appliances people don't have to bring their old refrigerators and washing machines for trade. The program will work in a rebate system.

The government's previous cash stimulus program Cash For Clunkers was a huge success. It helped to sell 450,000 cars in USA in the last three weeks. Now the Administration, encouraged by the success of the previous program is coming up with Cash for Appliances plan.

What comes next we don't know. According to Business Week and Guardian sources the plan will start in the Fall of 2009. In the meanwhile the stock market cheered Cash for Appliances introduction. "Whirlpool's shares rose 6% on Aug. 20 when news of the program circulated, and climbed another 5% the following session," reports Business Week. However, will the cash program help to sell enough Whirlpool refrigerators to boost the company's stock price six percent, remains an open question, as Cash for Appliances program is only 300 million dollars.

Written by Armen Hareyan