One of the hidden secrets about this ‘Cash For Clunkers Government Plan’ is that auto dealers pay the rebates from their own pockets and has to wait for the government to repay them. Obama has taken great credit for this plan, (the media really trying to make him look good) problem is, the government is so far behind that hundreds of auto dealers around the country have withdrawn from Cash for Clunkers, citing delays in getting reimbursed. The Greater New York Automobile Dealers Association, which represents dealerships in the New York metro area, said about half its 425 members have left the program because they cannot afford to offer more rebates. They’re also worried about getting repaid. AutoNation CEO Michael J. Jackson claims that the government owes his company about $45 million in rebates from the program. They have ran out of money once, good luck trying to get your $45 million Jackson. Obama earlier this month signed a bill adding $2 billion more.
Bruce McConnell, whose Healdsburg Chrysler/Chevrolet dealership has not been reimbursed for any of the more than 30 vehicles he sold in the “cash for clunkers” program that began last month, said he’s now on the hook for more than $100,000.
Henry Hansel, whose company sold more than 260 vehicles and is awaiting more than $1 million in reimbursements, said he’s asking customers to return their new cars and take their old cars back “if for some reason this thing backfires.”
Ryan Barth/GM, Bill Barth said “Its been well over a week since we submitted our first claim and we haven’t gotten a single penny from the government.” It’s been nearly three weeks since the Cash for Clunkers program began. While, thousands of people are driving away in their new cars…it’s the government that’s leaving dealers in the dust, adding “We are kinda of fronting the government the money. We’re sitting here, they owe us 80-100 thousand dollars.” (Justin Theel/GM, Cedric Theel) “We’ve done pushing 75 of the Cash for Clunkers deals and I think we have been paid on 5 or 6 of them so far.
Bob Kupper/ GM, Ressler Chevrolet said “We’ve done 65 clunker deals. This morning we got more payment. I think we have gotten paid on 9 of them. So you know thats what, 13/14 percent that we have gotten paid on.” Until now, roughly 300 people have been processing the more than 400-thousand requests. The government tripled the number of workers hoping to speed things up, adding “Once they say that its payment approved then its usually about 3 days before it hits our bank accounts.” Many local dealers say they aren’t worrying just yet because the program is beginning to slowing down
Justin Theel/GM, Cedric Theel said “There is a lot of money outstanding. We were hoping to get these deals approved and authorized and turned around and paid within a timely manner roughly 10-14 days as stated earlier in the program.”
The program offers rebates of $3,500 or $4,500 for trading in older vehicles for new, more fuel-efficient models. Dealers pay the rebates out of pocket, then must wait to be reimbursed by the government. Despite hundreds of sales where buyers received the instant discounts reimbursements to car-sellers have been few and far between.
Auto dealers have made clunkers deals worth $1.81 billion, resulting in 435,102 new car sales, according to the DOT.
Is this another one of Obama’s plans that is failure?