Dealers wary of Cash for Clunkers final push
Photo 
A Cash for Clunkers sign hangs on a upside down automobile Friday, Aug. 21, 2009, in at a dealership in Detroit. The Obama administration will bring to an end the popular $3 billion Cash for Clunkers program on Monday, Aug. 24, giving car shoppers a few more days to take advantage of big government incentives.
WASHINGTON Auto dealers are bracing for a possible rush of last-minute shoppers before the Cash for Clunkers program ends Monday, but some buyers may find they won't be able to cash in on big government rebates.
Dealers are increasing staff for the last weekend of the $3 billion program. But many say they will stop Cash for Clunkers sales after Saturday to make sure they get reimbursed by the government for the rebates of up to $4,500. Some reported traffic at showrooms began to swell Friday after the government announced the end date.
The weekend will be the last big push for the program that has helped revive sagging auto sales by allowing drivers to trade in older, less fuel efficient vehicles for new cars and trucks. Originally expected to last for several months, the program is on track to exhaust its funds in just over four weeks. It's been a big hit with buyers, but has led to hassles for dealers who have been paid for only a fraction of the rebates they've extended to customers.
"It will be somewhat good to get it done," said Skip Davenport, whose South Carolina Ford dealership hasn't been reimbursed for any of the $150,000 worth of rebates it has given to customers. The dealership will stop sales Saturday. "We are all just stretched."
The Department of Transportation Thursday that it will end Cash for Clunkers at 8 p.m. EDT Monday in order to avoid going over the billions set aside for the program.
Dealers say they may be in the difficult position of having to turn away new sales despite what is expected to be heavy weekend.
"I think we are going to have a lot of interest in the showroom, but we are going to be in the uncomfortable position of giving some people disappointing news," said David McGreevy, sales manager for AutoServ, a New Hampshire dealer chain.
All paperwork on pending sales must be submitted to the government by the Monday deadline, meaning dealers will be hesitant to make new Cash for Clunkers sales when they are still trying to get approval for sales made weeks ago, said Peter Kitzmiller, president of the Maryland Automobile Dealers Association.
The Obama administration has declared Cash for Clunkers a success, saying it has reinvigorated the nation's listless auto industry and taken polluting vehicles off the road.
Much of the data on sales seems to support that, with 489,269 vehicles sold through Friday morning.
Smaller, more fuel efficient vehicles like the Toyota Corolla and Ford Focus are top sellers, while buyers are trading in SUVs like the Ford Explorer to be scrapped. The program has been so popular that Congress refreshed it with an additional $2 billion when the original $1 billion ran dry in early August.
But many dealers are nervous they won't be repaid. As of Thursday, only about 7 percent of rebates had been repaid.
There's fear that the government's Web system for processing dealer paperwork will be overwhelmed. That happened when the program looked likely to end earlier this month.
"The focus is going to be getting the deals that were already started into the system," Kitzmiller said.
Dealers reported problems accessing the system Friday afternoon, though a spokesman for the National Highway Traffic Safety Administration, which is running the program, said there was heavy volume but no major problems.
Citing the reports, the National Automobile Dealers Association called for an extension of the filing deadline to Aug. 31, while keeping the Monday cut off for sales. The group said that would provide enough time for dealers to enter their sales. But the Department of Transportation said there were no plans to extend the deadline.
For car buyers, the message from dealers is clear — come prepared.
—Many dealers say they won't make deals this weekend without all the proper documents for the car they are trading in. That means the title, proof of registration and proof of insurance. Dealers need those to file their 13-page application for reimbursement.
—Problems could arise if there is a lien against a vehicle. There may be little time to retrieve that title from the lien holder by Monday.
—Some dealers won't make new deals on Monday, saying they plan to spend that day trying to get their current deals in before the deadline. So Saturday could be the last day of the program at some showrooms.
That provides some relief for anxious dealers like Ford's Davenport.
"We can get back to business as usual."

Aug 25, 2009 at 2:46 a.m.
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You’re welcome Private cant-think-straight. As I stated discretionary spending is dependant on who is spending the money. Just as some people don’t buy cars until theirs are dead/dying, they won’t buy an appliance for the same reason; depends on the consumer’s wants/needs. Private cant-think-straight might want to look into what also happens during kitchen remodels if he thinks appliances are not seen as sexy cool or fun.
Aug 25, 2009 at 1:27 a.m.
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"There are thousands of people living in New York City that don’t own cars yet have refrigerators."
Thank you, Captain Obvious, but those "thousands" of people in New York don't determine discretionary spending for the entire nation. Appliances will never be sexy or cool or fun (the "want" part of your equation). The average person won't buy a new appliance until their old one dies.
Aug 24, 2009 at 10:43 p.m.
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Hey Hannah,
Just curious, about what % has your dealership gotten reimbursed thru the fed. govt or whomever the 3500 to 4500 voucher and is that going to hurt dealerships by not having enough money to float until 2-3 months from now probably when the dealerships finally get paid? I can see the vouchers taking 2-3 months for dealerships to get paid which is a long time. Nothing the govt. does is done quickly, but they sure deposit your income tax checks if you happen to pay into the govt. instead of getting a refund which takes forever to get back thru the mail with the feds.
Aug 24, 2009 at 10:12 p.m.
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“Appliance purchases are far less discretionary than cars.”
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Where did you learn this? Both cars and appliances are discretionary based on a consumers want, demand, or where the live. There are thousands of people living in New York City that don’t own cars yet have refrigerators.
Aug 24, 2009 at 4:42 p.m.
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oooohhhh and by the way the system crashed again all weekend and the goverment responce was "TOO BAD" they extended till noon Tuesday to submit but from there you are on your own
Aug 24, 2009 at 4:40 p.m.
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Guys you people sometime really amaze me. Yes was the program a partial succes yes it was. I say only in part because the "goverment" completely screwed the pooch on the administration of said program. Requirements hard to satisfy and a computor system from the stone age to administer a program of such magnitude and now turns its poor performance back at the dealer. What a joke. More finger pointing from such a lack luster administration. Yet you folks want to debate who bought what. I got news for you American car dealers did not have the inventory to continue. Hence the order out provision. The whole program could have been a nice touch but ended up a debacle because of very poor planning by the administration.
Aug 24, 2009 at 1:13 p.m.
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"wish the one of mine would break so i can get another that matches!!"
That brings up an interesting point. Appliance purchases are far less discretionary than cars. The appliance rebates are expected to be $50 to $200. I wonder how many people are going to jump if they don't really need an appliance right now.
Aug 24, 2009 at 1:10 p.m.
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Hey Hannah, who cares about your refrigerator needs? Your serial posting, misspellings and typos are getting old. So are the rude and insensitive comments you made this past weekend.
Aug 24, 2009 at 1:02 p.m.
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The appliance must be Energy Star certified to qualify for the rebate, and you won't have to trade in an old one.
Aug 24, 2009 at 12:42 p.m.
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No, tinkle-down economics favors tax breaks for the rich, hoping their goodness of heart will trickle down to everyone else. C4C actually stimulates sales, helps middle class folks (who spend the most money), and anyone else in the supply chain, including all those workers now getting overtime or being called back to work.
The biggest drivers of economic growth in this country are housing and auto manufacturing. The last tax cuts/rebates by Bush/Obama haven't done much to stimulate the economy, and create just as big a problem (lower revenues) down the road if spending isn't brought under control. Supply-side economics doesn't work in a recession.
Aug 24, 2009 at 11:04 a.m.
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Zoom; That $3 billion STIMULUS pulled forward 3-5 TIMES that amount in sales, which helps everyone in the supply chain and increases local tax revenues. That's a good result for a relatively small cost. I know this program didn't conform to conservative, tinkle-down economic principles, but it worked.
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Dont look now but your making the case for trickle down economics - this is the exact same thing except it only helped industry directly related to auto industry & those that chose to buy the cars. Tax Breaks help EVERYONE.
Aug 24, 2009 at 10:49 a.m.
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Yep steralership and insurance companies all are bad and only the government is good...hard to talk logically when you think this.
Aug 24, 2009 at 10:42 a.m.
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RAF, nobody dropped $3 billion in a pile, did they. That $3 billion STIMULUS pulled forward 3-5 TIMES that amount in sales, which helps everyone in the supply chain and increases local tax revenues. That's a good result for a relatively small cost. I know this program didn't conform to conservative, tinkle-down economic principles, but it worked.
Comparing C4C to health care reform is another straw man argument by the anti-reformers. Considering how insurance companies continue to screw us, it's time for a different solution.
Aug 24, 2009 at 10:22 a.m.
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Did anyone else notice that the cars being turned in as "clunkers" are American made and the cars being purchased are foreign cars? What does this say about the auto companies and the workers who made them? Ouch!
Aug 23, 2009 at 4:45 a.m.
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Zoom where did I or anyone object to short term loans? Nice try at deflecting. Any free money is going to be popular, that is a given, and was never doubted.
The ironic issue is you claiming this was going to keep dealerships out of bankruptcy and more dealerships are in trouble now than before the program started. So much so that the government backed GM is floating loans to dealerships while they wait for their money from the C4C program; vehicles sold and gone that dealers have not been fully paid for. Hundreds of dealers across the nation stopped participating because they have not been paid!
You call that a success? On what measure, because people went for free government money? News-flash that happens everyday in this country. If you dropped 3 billion dollars in a pile in any city or state millions of people would fight for it.
This debacle was with just 3 billion. Health care is said to be anywhere from 6-13% of national GDP (depending on which numbers you believe). You seriously want the same people to manage 1000 times the size of C4C program and expect it too work?
Aug 23, 2009 at 12:42 a.m.
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RAF, now you're objecting to short term LOANS to dealers? Keep stretching. Admit it. This GOVERNMENT program was wildly popular, even beyond the expectations of the dealers. The first $1 billion was expected to last until NOVEMBER by Republicans.
C4C is a stimulus program that was successful. You can argue the benefits of government stimuli (even though that is the mechanism that historically has pulled our economy out of recessions), but to argue that THIS stimulus was unsuccessful because of short term problems resulting from it's populariity are silly.
I find it sad that some dealers (well, hannah, anyway) are now complaining about selling TOO MANY cars. Hannah, there is a reason people call the type of place you work a stealership. Do you seriously think you would have sold more cars over the long run without this program? How do you figure you will be "behind", since you admitted your stealership didn't start with many cars to begin with? Maybe your boss just didn't plan well.
Aug 22, 2009 at 7:52 p.m.
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Zoom, what is truly funny, you said this program was to keep dealerships from going bankrupt. Now GM is floating loans to dealers waiting to get paid by the government so they don't go bankrupt; government owned GM loaning our taxpayer money to dealers waiting on C4C tax payer money from an ill run program?
Your blinders don't allow you to see how ironic the whole situation is.
Aug 22, 2009 at 5:46 p.m.
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Next thing you know the elitists will tell us we won WWII and got out of the Great Depression with borrowed money. Oh wait we did.
Aug 22, 2009 at 4:11 p.m.
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Good riddens CARS!
That sums it up!
Now lets wait for the layoffs and salesmen to get laid off at dealerships because they have no cars to sell and will be bored out of their mind once again, at least for awhile.
Aug 22, 2009 at 4:03 p.m.
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I put together some good resources, if you’re interested in the Cash for Clunkers program.
http://www.autostimulusplan.org/
I gathered a list of Pros and Cons for the individual (4-Pro, 6-Con), and Pros and Cons for the Collective Soul (6-Pro, 12-Con).
After the results are in, I’d like to post the statistics to show benefits vs. consequences.
Aug 22, 2009 at 3:28 p.m.
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This program was a success at giving away more borrowed money to prop up the auto industry. It isn't always this easy to give away money, but sometimes you get lucky and people will take it. Anyone with government health care is living in a parallel health care universe and cannot possibly be expected to understand what it is like to pay for health care.
Aug 22, 2009 at 10:46 a.m.
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No, RAF retired from GOVERNMENT employment. Too funny.
Aug 22, 2009 at 10:44 a.m.
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Leave it to stealerships to complain about selling TOO MANY cars.
This is what you call a high-class problem folks.
Aug 22, 2009 at 10:10 a.m.
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"But many dealers are nervous they won't be repaid. As of Thursday, only about 7 percent of rebates had been repaid.
There's fear that the government's Web system for processing dealer paperwork will be overwhelmed. That happened when the program looked likely to end earlier this month."
And these are the folks we're going to turn over our health care to, good luck.
Aug 22, 2009 at 9:31 a.m.
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The reason this is "messed up" as you call it, is because it was way more popular than anyone imagined. Plus, dealers were not forced to use this program, and they understood the delays involved after seeing the first wave of buyers.
Aug 22, 2009 at 8:51 a.m.
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Nope, not in the insurance industry.
Aug 22, 2009 at 8:48 a.m.
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Yeah, health care is running just fine in this country. What insurance company do you work for, RAF ???????
Aug 22, 2009 at 7:49 a.m.
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And so many people want government to "fix" health care...look how messed up this has become, think what our economy would be like with them controlling almost 16% of GDP; Yikes!
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