The U.S. House of Representatives approved on Friday a $2 billion extension of the Cash-for-Clunkers automobile sales incentive program.
The Democratic proposal would run through September 30, 2010, and tap funds from an Energy Department loan guarantee program included in the economic stimulus package enacted in February.
An initial $1 billion in funding approved this summer to boost stagnant industry sales has already been exhausted, officials said.
Consumers stormed dealers over the past month to take advantage of federally backed rebates of up to $4,500 on trade ins of gas guzzlers for more fuel efficient vehicles.
Unofficial government and industry estimates show that close to 250,000 vehicles were sold under the program.
The Senate is expected to act on the House bill.
Already a key senator, Energy Committee Chairman Jeff Bingaman, said he opposes using Energy Department funds for the auto program.
Another senator, auto industry ally Debbie Stabenow, said pushing the measure out of Congress would potentially take a lot of work compared to the extraordinarily swift action in the House.
The White House supports new funding for the program on grounds the initiative so far has provided a viable, national economic stimulus amid recession.
(Reporting by John Crawley and Rick Cowan; editing by Gunna Dickson)