Cash-for-Clunkers May Be Suspended; We Hardly Knew Ya

The government's cash-for-clunkers program was suspended last night by the government as confusion reigns over how much has been spent and the process for dealers to submit rebate information.

The government's cash-for-clunkers program was suspended last night by the government as confusion reigns over how much has been spent and the process for dealers to submit rebate information.

The confusion extends to whether the program is still operating.  Some adminstration officials have told Congress the program is being suspended while others have stated that the program is still operating.

The program offers $3,500 or $4,500 for the trade-in of cars and trucks that get 18 mpg or below and the purchase of a more fuel efficient vehcile.  The Detroit Free Press reports that:

"A survey of 2,000 dealers by the National Automobile Dealers Association, the results of which were obtained by the Free Press, found about 25,000 deals not yet approved by NHTSA, or about 13 trades per store. With 23,005 dealers asking to be part of the program, auto dealers may have already arranged the sale of more than the 250,000 vehicles that federal officials expected the plan to generate."

The same article reports significant confusion about the paperwork needed to get the credit.  The National Highway Traffic Safety Administration has told dealers that the vast majority of paperwork submitted has been rejected for incomplete or illegible paperwork.

My bet is that the government is going to find a way to add more money to the program so that it can last for a few more weeks.  So, if you have a gas-guzzler and are ready to trade it in, get ready.  The window may open again - for a short period.

 

 

Sam Cass
Sam Cass: Sam Cass, MBA, JD, University of Texas at Austin. Always a fan of Leonardo Da Vinci.

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Comments

  • Sam Cass

    August 01, 2009

    Update: It looks like the adminstration and Congress may allocate an additional $2 billion for the cash for clunkers program. The bill was passed by the House and now goes to the Senate.

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