Government Ending 'Cash for Clunkers' Program Monday

WASHINGTON --

The Obama administration plans to end the popular $3 billion Cash for Clunkers program on Monday, giving car shoppers a few more days to take advantage of big government incentives.

The Transportation Department said Thursday the government will wind down the program on Monday at 8 p.m. EDT. Car buyers can receive rebates of $3,500 or $4,500 for trading in older vehicles for new, more fuel-efficient models.

Through Thursday, auto dealers have made deals worth $1.9 billion and are on pace to exhaust the program's $3 billion in early September.

The incentives have generated more than 457,000 vehicle sales. Administration officials said they have reviewed nearly 40 percent of the transactions and have already paid out $145 million to dealers.

Administration officials said applications for rebates will not be accepted after 8 p.m. EDT Monday and dealers should not make additional sales without receiving all the necessary paperwork from their customers. Dealers will be able to resubmit rejected applications after the deadline.

President Barack Obama said in an interview Thursday that the program has been "successful beyond anybody's imagination" but dealers were overwhelmed by the response of consumers.

He pledged that dealers "will get their money."

Dealers have complained of delays in getting reimbursed and backlogs of vehicle paperwork getting processed in the program. Dealers have said they face a risk of not being reimbursed

but LaHood has pledged that dealers will get paid for the incentives.

I wonder if they will get paid before their car lots look like the below picture!

The administration has said it has tripled the number of staffers sorting through the dealer paperwork.

Meanwhile, hundreds of local car dealerships are pulling out of the program because of the many delays of getting paid back from the government.

The greater NY automobile dealers association says the dealers cannot afford to offer more rebates while waiting for reimbursement.

Most dealers are worried they won't get paid at all.

The above signs will be seen all over if payments aren't made soon!

"The Federal Government hasn't even told them whether their transaction they just sold is going to be "paid or funded" at all.

Dealers pay the rebates out of pocket, then must wait to be reimbursed by the government. But administrative snags and heavy paperwork have created a backlog of unpaid claims.

Many dealers have waited so long to get reimbursed they don't have the cash to fund any more rebates.

"The program is a great program in the sense that it's creating a lot of floor traffic that a lot of dealers haven't seen in a long time," he said.

"But it's in the hands of this enormous bureaucracy and regulatory agency," he added.

"If they don't get out of their own way, this program is going to be a huge failure."

Obama says he's adding three times the staff to process the claims. Either they planned for failure or don't know how to plan at all.

A lot of claims are being rejected for information that is wrong or missing.

Typical government program make it so difficult that people cant even fill out the paper work properly to get paid.

After Taking In the Clunkers, Car Dealers Report an Extended Wait for the Cash

Cash for Clunkers is killing the car industry.

Car dealers are growing increasingly impatient with the government's slow pace in reimbursing them for accepting trade-ins as part of its popular "Cash for Clunkers" program, even though Transportation Department officials say they are working to address the delays.

The National Automobile Dealers Association estimates that dealers have hundreds -- and in some cases thousands -- of applications pending that are "worth hundreds of thousands or millions of dollars."

In Maryland alone, dealers have put in $36 million in claims under the clunkers program but have been reimbursed for only about 2 percent of the total, said Peter Kitzmiller, president of the 325-member Maryland Automobile Dealers Association.

"It is ludicrous at this point," Kitzmiller said. "We've got deals that are just sitting there waiting to be reviewed. The customer is gone, the car is gone, and you don't have your money."

Under the program, people who scrap their gas guzzlers can get a voucher worth up to $4,500 toward a new, more fuel-efficient vehicle.

Dealers essentially front the money for the cash incentive with the understanding that the government will reimburse them once they file the necessary paperwork online and the deal is approved.

Fitzgerald Automotive, one of the largest Washington area dealerships, says it is owed $2.7 million from the government. Darcars, another large area dealership, says it is owed $5 million after taking in roughly 1,300 vehicles.

To deal with the issue, the National Highway Traffic Safety Administration said it is tripling the number of workers who are processing claims to 1,100 contract and federal employees. Trade groups are offering Web seminars to help dealers figure out how to properly submit paperwork so they get their money faster.

In the roughly three weeks since the program officially began, 411,624 transactions, worth $1.7 billion, have been submitted, according to government numbers released Tuesday.

Most of the clunkers traded in were trucks and sport-utility vehicles. Toyota Corolla, Honda Civic and the Ford Focus have been the top three new vehicles bought under the program.

To keep up with demand some automakers have said they are increasing their production.
For the first time since filing for bankruptcy, General Motors is hiring back workers to meet higher-than-expected demand for cars and trucks. The company will reinstate 1,350 workers and add overtime for about another 10,000, the result of a broad surge in sales at least partly due to the clunkers program.

The rehires represent only a small portion of the tens of thousands of GM workers who have been laid off in recent years, but the news is a marked turnaround from just months ago when the company was undergoing bankruptcy proceedings.

"We're running much hotter," said Mark LaNeve, GM's vice president of U.S. sales.
Most of the jobs will be added at the company's Lordstown, Ohio plant, where the Chevy Cobalt, a small car, is built, while others will be added in Ontario.

The news from GM follows Ford's announcement last week that it is boosting North American production to meet the increased demand spurred by the clunkers program.

Ford said its third-quarter output would rise by 10,000 vehicles to 495,000, primarily because of increased demand for Escape small utility vehicles and Focus small cars, the two most popular Ford vehicles under the federal incentive program.

The problem here is that the "promised" incentive money is not being produced. What is going to happen is that the lay offs are going to increase if the funding does not come in soon. The car companies will have to claim bankruptcy as they will not be able to pay the employees what is owed to them and then of course with the large surplus of cars they will have just sitting around...well you see the point here.

I said from the beginning that this was a good idea gone really bad. With the national debt being what it is...how and or where will this agreed upon funding come from?

I Never Agreed to This...I never Said this was a good idea...Did You?

Clunker Program is a Clunker!

Cash For Clunkers program

fully loaded with debt!

The cash for clunkers program has given taxpayers a valuable lesson...

The lesson can be taken two ways.

1. How to get our county in more debt

2. Or how to put ourselves in more debt

Either way we lose.

I recently read of 5 different mistakes that were made with this incentive program and decided to share this here.

1. 
   
   
   

   Taking a good idea and making it bad: The government should encourage good behavior and we all should work at making this country better. However the clunker program should have had a cap of $1000 or maybe even $2000 per buyer. Rather the offer was up to $4500 per buyer and the market force was distorted.



2. 
   
   
   

   An inability to simply say NO: The program quickly burned through the first billion that was set aside and then rather they saying Yeah, congress acted as if they were in Vegas and shoveled out another $2 billion into the pile. Remember they are playing with our money.



3. 
   
   
   

   This was focused on the short term and not the long term: Everyone ran out and cashed in their old car for a new one...sales skyrocketed for auto makers. Now what about the 4th quarter? Most buyers have already bought what they wanted and we don't buy cars every month...its not like bread, milk or eggs. The car dealers are now going to be sitting on a lot of inventory as sales plummet.
   

   Ironically this was designed to boost American Auto makers and Ford Focus did lead the pack in sales. Directly following Ford came Toyota corolla, Honda Civic and Toyota Prius and Camry all FOREIGN models. I wonder if Japan will send us a thank you?



4. 
   
   
   

   Taking credit for what is going to happen anyways! Lets face it...old cars are junked anyways as they quit working. The cars that qualify for this are old smoking burnt out clunkers that will be off the road anyways.



5. 
   
   
   

   Ignoring the deficit: While everyone was slapping each other on the back and praising what a good idea this is they seem to have forgotten the key point: Our government is not funding this we are...and since they forked out the now $3 billion dollars and this money is borrowed from our future...thus adding to the enormous debt we have already racked up.

With the above mistakes, people losing their jobs and becoming homeless...I guess those new car owners can live in their cars...that is until the dealership comes to repo for it for lack of monthly payment.

Many sales under the clunkers incentive appear to be deferred purchases from buyers who otherwise would have bought a new car before the program started. They just held out to receive the extra money. I guess you and I can pay for someone else to have a new car...No wait that will end of being the burden of our children and their children.

I NEVER AGREED TO THIS! I NEVER SAID THIS!.....DID YOU?