Cash for Clunkers ends 24 August 2009 A.D.
Government Motors…um, I mean GENERAL Motors…will see their best month of the year due to the government’s Chaos for Clunkers program. Sadly, only 2% of claims have been paid to dealerships nation wide. Even the National Automobile Dealers Association was leery of the program and many dealerships pulled out of it due to the fact that the government hasn’t reimbursed them, yet!
Maybe this is the government’s “you can’t fire me, I quit!” way of handling their failed process. Can’t wait to see how they’ll handle healthcare…
Full story here, bits below.
The U.S. “cash for clunkers” vehicle trade-in program, credited with reviving auto sales and criticized by dealers for slow reimbursements, will close on Aug. 24, Transportation Secretary Ray LaHood said.
The deadline will give car dealers and buyers time to complete purchases and submit applications for rebates from the remainder of the $3 billion provided by Congress, the department said. Dealers have complained of difficulty running their businesses while awaiting payment in the program, and the agency said it’s adding workers to help process claims faster.
Officials from the National Automobile Dealers Association trade group met yesterday with the Transportation Department to discuss concerns that payment delays add to the burden on retailers of trying to recover from a sales slump. NADA also urged the agency to outline a plan to wind down the effort so retailers know when to stop accepting trade-ins.
Representative Joe Sestak, a Pennsylvania Democrat (emphasis mine), said last week the effort had paid retailers for only 2 percent of their claims.
The program is formally known as the Car Allowance Rebate System, or CARS.
Senate Majority Leader Harry Reid, a Nevada Democrat(emphasis mine) , asked LaHood in a letter today to speed up payments, saying “dealers have been forced to effectively finance the CARS vouchers for buyers until the dealers are reimbursed by the federal government, placing a strain on dealers’ balance sheets that, if prolonged, could eventually offset some of the benefits of the program.”
The government’s initiative may give GM its best sales this year in August. New-vehicle retail sales in the U.S. will top 1 million in August for the first time in the past 12 months, J.D. Power & Associates forecast today.
