According to one company, if Americans were given an incentive to buy used cars, it may help improve the economy.

CarMax is urging Congress to consider including used vehicles in the proposed Cash for Clunkers legislation in an effort to have more Americans afford a car.

The proposal legislation aims to increase new auto sales by giving consumers a voucher to trade in their older car for a new one. The amount will reportedly depend on the make or model of the car.

However, if Congress allows used cars to be included into the legislation, the thinking is that it will allow more Americans to purchase a car, thus spurring the economy. Given the popularity of hybrid vehicles, it may also help get older model cars, which may not be environmentally friendly, off the road, which is another goal of the Clunker program.

Because of the current state of the economy, many people have looked into purchasing a used car instead of opting for a new one, citing their need to save money.

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That late-model used car you’ve been eyeing may have gotten better, at least in the eyes of some insurance companies.

A new report released by the Insurance Research Council has found that used cars with front and side airbag systems have a “beneficial impact” on auto injury insurance claim costs.

The increase of automobile safety was found in 2007 vehicles that filed various claims when compared to older models, such as ones from 1990 or 1980, where only seatbelts were found in the car, according to the report. Among the 2007 cars, 82 percent had front and side airbags, suggesting cars from that year and onward may be a safer used car to purchase.

The presence of the airbags was associated with less significant injuries and lower claim costs when the vehicles were involved in a crash.

“Motor vehicles are becoming safer, and these improvements are having a noticeable impact on the seriousness of injuries and the ultimate cost of auto injury claims,” said Elizabeth Sprinkel, senior vice president of the IRC. “These favorable trends have helped offset some of the pressure caused by the accelerating cost of medical treatment for auto injuries.”

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It appears that the auction General Motors had planned to rid itself of about 100 classic cars it had in storage and raise money for the failing automaker has been called off by the National Highway Transportation and Safety Administration (NHTSA).

GM, along with Barrett-Jackson Auction Company, was planning on auctioning off cars which it housed in its Heritage Collection.

Both companies have pointed out that many of the cars would not be able to be registered and would be sold with salvage titles as they would not be street legal vehicles, but apparently the federal government is concerned that people who purchase the cars will try to get them registered anyway.

Edmunds cites a story from Sports Car Market which says the NHTSA has halted the auction in Florida for fear of the rogue registration attempts.

A GM auction in January went through without reprisals from the federal government. At that auction more than 200 vehicles were sold including a 1969 Reggie Jackson Camaro which in a 2007 review Edmunds.com called “pure vehicular violence,” “a cranked-up 24-hour high,” and a “rolling onslaught of rawness.”

Although news of car dealers closing is not a good sign for the state of the economy, it may mean savings for used car buyers across the country as many car lots will be overfilled with vehicles.

According to Lang Marketing, at least 2,000 car dealers will shut their doors in 2009 with an estimated 32,000 dealer service bays also shuttering.

However, the company said the exact number of dealer closings can fluctuate as some may shift to the growing used car market.

Jim Lang, president of the company, said the shift will cause an increase in sales to independent automotive dealers and will be the largest change in the auto industry in about 60 years.

“This is part of the greatest restructuring of the automotive aftermarket competitive landscape since World War II, which will extend over a number of years,” said Lang.

The used vehicle market is already seeing growth as more Americans are turning to used cars as the recession continues. A recent survey from Cars.com found that 32 percent of car buys who would have normally purchased a new car in better economic times shopped for a used car instead last month.

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Yet another report finds that as the economy continues to sag, more Americans in the market for a car are turning to used cars.

The Federal Reserve’s Summary of Commentary on Current Economic Conditions, more commonly referred to as the Beige Book, finds that consumer interest in used vehicles remained strong in February, even while new car sales plunge.

According to the report, in many of the major markets the Fed tracks, used car sales outperformed their new car equivalents.

“Sales of new automobiles and light trucks remained exceptionally sluggish, with Philadelphia, Richmond, and Kansas City reporting further declines from an already slow pace of sales,” finds the report. “Used vehicles fared better in general, with Kansas City and San Francisco noting that they were selling well and Cleveland and Chicago reporting improvement over the previous period.”

This appears to be an ongoing trend for the car industry as Edmunds.com reported in February that in the three months prior, more than half a million people who would have bought a new car during a better economic period chose a used car instead.

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Lower gas prices have dropped the demand, and therefore the price of used hybrid vehicles, which may make it a good time for consumers to shop for a used hybrid.

Although gas prices have fallen from the high figures consumers struggled with over the last few years, experts expect prices to go on the rise again at some point. But until that happens, it appears the appeal of hybrids has waned in light of gas prices under $2 per gallon.

Juan Flores, director of vehicle valuation for Kelley Blue Book told USA Today that sales of used hybrids are down 23.5 percent since last summer when gas was at its peak price, and have fallen 4.5 percent since January.

This has caused an excess of used hybrids on lots around the country, which could be good news for drivers looking to get their hands on a used hybrid vehicle.

Earlier this week Toyota unveiled its 2010 Prius at the Geneva Motor Show which the company says will get an EPA rated 50 miles per gallon.

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For many people, the purchase of their first car is one of the most memorable moments of their life, but that purchase can also be costly. To help many first-time car buyers out, MSN Autos has come up with a list of practical, safe and reliable cars that are still fun to drive.

Honda topped the list as the site says the Civic, with its inexpensive price tag and fuel-efficient engine, makes for a good initial purchase. For those looking to increase their gas mileage, drivers can look for a Civic Hybrid that gets 45 miles per gallon on the highway.

The top ten cars on the website’s list are all foreign with the exception being the Pontiac Vibe, which in reality is a Toyota Matrix with a few more bells and whistles.

The most economical car on the list is the Suzuki SX4 Sport which starts around $13,000 and which comes with a standard navigation system.

Last week Consumer Reports released its list of the most reliable used cars with the Honda Civic topping the list in the small car category.

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It seems that in addition to paying more for having to fill up more often, owners of gas-guzzling cars in Massachusetts might need to pay an additional tax for the privilege to drive around.

Although Massachusetts governor Deval Patrick did not go into the specifics of the proposal, the so-called Hummer tax would place fees on the drivers of cars with low gas mileage, and give incentives to the drivers of more fuel-efficient vehicles.

The idea of taxing citizens for driving gas guzzling vehicles has been on the table in a number of states for some time, but if a law were passed in Massachusetts it would be the first in the nation.

Chris Britt, CEO of a Boston accounting firm says he already pays $450 extra each month to park his Hummer downtown and says neighbors at his condo are proud to be drive more “green” vehicles and think it’s absurd he drives a Hummer.

“But in the last snowstorm, I saw people spending hours digging out their Priuses,” Britt told the Boston Globe. “With my truck, I can drive through anything. I can park it on a snowbank.”

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Despite a slumping economy, people still often need to purchase a car and according to Edmunds.com, more people are turning to used cars to save some cash.

Edmunds, an online automotive resource, says that 511,000 of the used cars purchased in the last three months would most likely have been new car purchases in a better economy.

“It is safe to assume that many shoppers who normally would be tempted by ‘new car smell’ and the latest automotive technology made a more cost-conscious decision because of economic pressures,” said Edmunds.com senior analyst David Tompkins.

According to the research, more than two thirds of the people who bought used cars did not even consider a new car when they began looking at vehicles. In a normal economy they would have at least considered a new car, says Tomkins.

The remaining buyers did look at new cars, but at some point decided to make a used car purchase instead.

Those who did make a used car purchase seem to have chosen a proper time to make that buy as Dow Jones recently reported that used car prices fell by 8 percent in 2008.

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New legislation proposed to Congress may allow owners of gas-guzzling older vehicles to trade them in to get cash for the purchase of a newer vehicle. This is great news for anyone looking to swap their car for more fuel-efficient New York used cars.

The legislation, dubbed “Cash for Clunkers” is aimed at removing older, lower gas mileage vehicles from the road and replacing them with cars with better fuel efficiency ratings.

According to the Associated Press, the new law could save 40,000 to 80,000 barrels of fuel each day by the end of its fourth year.

Drivers could be eligible for up to $4,500 for their vehicle, which could then be used to purchase a newer used car. However, vehicles must have a suggested retail price under $45,000, must be drivable, 2004 or older and get less than 18 miles per gallon.

Maine senator Susan Collins, a co-sponsor of the bill, said it “would reduce our dependence on foreign oil, decrease greenhouse gas emissions and stimulate the economy,” according to the AP.

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