Dealers: End Clunker Program

It’s been nice, brought a lot of people down to the lot, and got Ford and GM making more cars. But it’s time for the Cash for Clunkers program to end.

That’s what the National Automobile Dealers Association says. The dealers say in a press release that they’re worried about getting paid by the government for all those clunkers they’ve been taking in trade. Given the pace at which they’re taking on clunkers, the dealers say it’s impossible to calculate the “burn rate” of federal money set aside for the program.

Transportation Secretary Ray LaHood says everyone will get their money. "We have the money to provide to them. We have put an enormous number of people on the task of processing the paperwork. There will be no car dealer that won't be reimbursed," he said at a press conference Wednesday.

But the dealers say they’ve confirmed elsewhere that once the money runs out before a dealer is reimbursed, that dealer is out of luck. So the NADA, which represents 20,000 new-car dealers, is calling on the government to come up with an endgame for the program, including a possible suspension of Cash for Clunkers.

The Senate last week passed a $2 billion extension of the program after Cash for Clunkers quickly burned through it’s initial $1 billion in funding after its kickoff July 24. About $1.5 billion in claims have been submitted by dealers who have sold about 360,000 cars as part of the program.

With dealers worried about when they will be paid, GM announced this morning that it would advance cash to its dealers who are waiting on their government checks. The outlay is worth it to GM, which has sold 60,000 more vehicles in the past two months than it had internally forecast.