Customers Scramble for Cash for Clunkers

(CBS)  Late Saturday morning, Ron Holmes drove off in his new van from a New Jersey dealership. After driving 250 miles yesterday from his home in Maryland, he was afraid he'd missed out on trading in his clunker, a 1995 Chevy van. But it all worked out, reports CBS News correspondent Randall Pinkston.

Holmes discount will amount to about $7,000, and that includes $3,500 from the Car Allowance Rebate System, known as Cash for Clunkers.

Its success was a major surprise.

"We sold nine cars since the program started," said Kamil Askhar, the general manager of Englewood Chevrolet. "That's within a week."

The $1 billion program, launched nine days ago, was supposed to last until November. Then on Thursday - a scare - reports the money had run out in just one week, making dealers like Ashkar very nervous.

"I'm not going to sell the car based on Cash for Clunkers unless I know I was guaranteed the money," Ashkar said. "There is no way the dealership can have $3,500 to $4,500 loss on a sale."

The White House guarantees the program at least through the weekend, so Ashkar is continuing to provide the clunker discount.

Saturday morning, Transportation Secretary Ray LaHood sought to reassure dealers and prospective car buyers that the plan would continue.

"No one should worry," LaHood said. "Go out and buy a car."

Click here to find out if your car's gas rating qualifies as a clunker

Click here for general information about the program

Analysts believe the Senate will have to follow the House's lead and guarantee the additional $2 billion to continue the program.

"The valid deals that are on the table right now I think the government will fund, because otherwise, they're leaving the dealership holding the bag," said Rebecca Lindland, an automotive industry analyst with HIS Global Insight.

While dealers like the program, they don't like the 136-page rulebook and a constantly-crashing Web site that dealers must use to register clunkers and get the government reimbursement. But there are no complaints about the ability to bring in more potential buyers.

"If there was no Cash for Clunkers program, would you be doing this trade in?" Pinkston asked Holmes.

"No, not today," Holmes said.

And no complaints from junkyard owners, who get the old cars from the dealers after the engines have been disabled.

"It's double the business," said Ed Malone with Brookfield Resource Management. "We're getting a lot more cars in. It's good for my business."

The government isn't sure yet whether the first billion has actually been spent yet. But if it has, it means the additional $2 billion Congress is expected to appropriate could be gone in less than a month.

[JayAdlerMusic]

Please review my clunker blogs where some time ago I predicted cobweb conundrums for the dealers and customers. This whole episode was sort of like when I was a young man finding a new date who appeared to be Teri Hatcher for the first two weeks evolving into Tug Boat Annie in week three. The bloom is off the rose and I do not want a public plan fiddling with my PSA tests. Also on something else, a nuclear plan is a dismissive maneuver to obviate my input in my future as an American citizen. I am a voter, as a Republican, I deserve representation. Same as 3 card Monte in my old neighborhood.

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I would like to bring up perhaps a whimsical and admittedly speculative question about the controversial White House website where American citizens are asked to inform on others exhibiting fishy dispositions on Obama's health care initiative. What if a scorned woman attempting to get vengeance against her boyfriend living now on the other side of town decides to get revenge. She goes to a library or a college campus and gains access to a public computer so that her home IP address cannot be determined. Can you imagine what horrible allegations she could send by e-mail to the federal government. Would the authorities, in receipt of this false information be compelled to investigate the guy if the angry woman gave them his contact information? I would guess if she accused him of some heinous, high crime, what else could they do. If they in any way allow ad libbing on this site or allow people to describe the healthcare event in their own words, Kafka will return to force innocent Americans into untenable siuations.
































































which could cause innocent citizens a ton of trouble.

[JayAdlerMusic]

The times we live in remind me of a Green Day concert. People are suffering immeasurably from an unrelenting recession which in a 3 year hindsight analysis might actually be characterized as a Depression. Despite the dog and pony show beer party, I will agree that although racial issues and mistrust can never be stamped out completely, I know, having lived through the 1950's that we are in far better shape together than we ever were and even elected a Black President. I am beginning to see a breakdown in government and the beginnings of some civil unrest that are starting to be more intimidating than when the tea parties started.A governemnt website is asking us to turn in our friends for expressing their views. I saw this as a thirteen year old when in 1964 the whole nation was glued to their Philco and Sylvania analog television sets as we viewed a protest phenomena that was peaceful and although fundamentally secured by a far different subject, still displayed the sheer frustration and exclusion from government that we collectively feel today. That was the March on Washington and you know something, it sure did work.

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It is becoming apparent to me that issues concerning the future effectiveness of our air traffic control system, FAA safety oversight and the feared mess that going to the airport with your family to go on vacation is becoming more and more of a better issue to focus on especially today. The public plan that is hog tying the administration and extending campaigning beyond its natural life should be minimized as we receive reports of 12 NW Airlines planes subject to defect. I am sure that higher taxes could insure the individuals and future individuals who have no plan, I am all for it as long as it stops there. Subjects like improving airline safety which affects 4 billion passenger miles is far more important than beer parties with unknown residents and pushing a health plan that will never come in as presented.

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I indicated that I would submit a follow up blog to a post of mine citing a report issued by all the news organizations concerning a proposed Internet site designed to enable American citizens to report to the White House individuals making "fishy" comments about Obama's health care initiative. While I was shocked at the description of this preposterous and wholly unconstitutional being noted for public information, it all disappeared overnight as I suspected it would. Just the usual untenable misinformation we often are subjected to.

[JayAdlerMusic]

It is possible that due to the shock value of what I heard on the news tonight there is some chance that I misunderstood the content of the reporting. Apparently we as Americans are being asked to forego our unique and cherished Constitutional First Amendmendment rights by informing on our friends and neighbors and reporting to the White House. Millions of Joe Villachis (stoolies as we used to call them in the old days). At this point should this be true, we would be correct in renaming our Capitol Pyongyang 2. So at this point because I still am not convinced that I heard this right, I will reserve judgement in preparing a future blog until such time as I can verify this issue.

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My wife and I have been fighting every day and sometimes it gets loud, for 28 years now. If Mr. Obama had received a complaint about the two of us and invited us for a beer party, our kids are grown so we realistically could have jumped in the Hyundai and accomplished just as much as Gates and Crowley did. We still would have battled it out on the way home. Wouldn't be more conducive to what is sensible for President Obama and his diplomatic corps {should Hillary be okay and willing to join in spite of the injury and her aspirations, fine} to head off a nuclear Iran. It is not clear to me when the prediction regarding a nuclear capable Iran will come to fruition but it could be not too far away. If Obama positively has notions of actually preventing this catastrophic reality with slick diplomacy then I think in the interests of all parties concerned,which is the entire global community he better get going. I am citing a condition that in truth for all we know is being disposed of behind the scenes. In the absence of clandestine talks that will be absolutely successful and held while the program is not simultaneously proceeding.I would suggest that Mr. Obama concentrate on mediating the big issues now. Gates, Crowley, my wife and I can be settled down at a later and more peaceful time.

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Typos plague me sometimes so let me make this clear: The cars that will soon be offered to the public from China will retail for about $2,000 (Two Thousand dollars). Thank you.

[JayAdlerMusic]

A retail price is not the dealership's cost basis. Packed into the retail are fixed and and variable costs. So this entire Clunker program is not as simple as it sounds. As I have mentioned, because you had better file all of that new paperwork error free, even though the salesman are being briefed I heard about these returns taking hours to do. That is more employee time subtracted from the net and more time an employee is taken away from what they normally would be doing. Additionally, I will bet we are now going to have a problem with the junk industry who have to be the disposal sources. The old American way will be for them to jack up prices for a captive audience. Again, all these new and extenuating cost inputs subtract from the net. Why do we not all have programmed lifestyles and let our government pay it all based on our tax payments? Managing businesses does not seem to be their strong suite.

[JayAdlerMusic]

How much comprehensive planning was conducted when during the evolution of this Cash for Clunkers plan? There is a Chinese car company coming to America replete with a dealership network offering brand new vehicles for maybe $2,0000. We could have given each candidate a brand new car for perhaps $2500 less and I do not know of any dealer actually getting a check when the car he sent out was not owned but margined. Many potential buters were either sent home for not understanding the deal or crying bait and switch because they stayed anyway. No body can predict because of political infighting after the fact how long we will continue this bailout. Another thing, the dealers are nervous about their net profit because there is a load of paperwork that has to be filed by numbers people who now will eat up hourly costs in addition to the obligation of disposing of the clunkers. Is this the same administration that is going to manage our health care?