Dealers Get More Time to File for Clunkers

Government Extends Deadline to 8 P.M. Tuesday to Send in Paperwork

(AP)  Car dealers will have a bit more time to get reimbursed for their Cash for Clunkers deals after the government extended the deadline for filing applications for the $3 billion government incentives into Tuesday evening.

All sales under the program ended Monday evening. But after already pushing back the deadline to submit records for the car rebate deals to noon Tuesday, the Transportation Department said the deadline would be extended to 8 p.m. EDT because of problems with its Web site.

Government computers set up to handle the filings were deluged by dealers trying to send in their sales agreements at the last minute. Before the extension, all the paperwork was due to be submitted by Monday night, but the big rush of submissions shut down the government's computer filing system temporarily. That raised concern among dealers that they wouldn't be repaid for the $3,500 or $4,500 per vehicle incentives, and prompted them to push for an extension.

The government agreed to give dealers more time to provide the proper documentation and have ramped up staff to handle the influx. Transportation officials said the computer system was up and running on Tuesday morning.

Geoff Pohanka, who heads about 15 dealerships in Maryland and Virginia, said he had submitted about 910 clunker deals to the government and had only received payment for 16. He estimated the government owed his dealership about $4 million for the outstanding claims and was hopeful to get the final 90 voucher submissions into the system.

"Every 30 seconds, we're going back to the computer to see if we can get them in," he said.

"Cash For Clunkers": Did It Work?

Transportation officials said that, through early Tuesday, dealers had submitted 665,000 vouchers totaling $2.77 billion. Many dealerships have worked overnight in recent days to submit each trade-in vehicle's 13-page reimbursement application, including the title, proof of registration and proof of insurance. They have pressed employees to double- and triple-check their paperwork to ensure that applications won't be rejected.

"We've spent the better part of the last three days trying to hack our way into their computer program that has been down more than it's been up," said Alan Starling, who owns two General Motors dealerships in central Florida.

Cash for Clunkers has been wildly successful in spurring new-car sales and getting gas-guzzling models off the road, though some energy experts have said the pollution reduction is too small to be cost-effective. Customers received rebates of between $3,500 and $4,500, depending on the improvement in fuel efficiency from their old vehicle to their new one.

Transportation Secretary Ray LaHood, speaking to reporters in Norristown, Pa., said the program was an unprecedented success and a boon for car dealers, automakers, scrap yards and financial institutions. He estimated that by the sales deadline on Monday, "there will be 700,000 to 800,000 cars that have been sold, most of them fuel efficient," replacing gas-guzzling cars and trucks.

Dealers so far have only received a fraction of the reimbursement funds they are owed. Through last Thursday, the most recent data available, the Transportation Department had reviewed and processed more than 150,000 reimbursement applications and approved just $140 million in payments to dealers. At the time, DOT had processed about 30 percent of all the applications they had received.

"With the added staff and the better paperwork submitted and everybody being more comfortable with the process, it's like a logjam. It's going to break through," said Michelle Primm, managing partner of Cascade Auto Group in Cuyahoga Falls, Ohio.

[6591Hou]

We borrowed money from the Chinese in order to buy more energy efficient cars from the Japanese and make our U.S dealerships feel better - truly an international success story!

[bygrace101]

If I was a dealer I would not trash the car until I got my money. It's too bad that the people who cannot afford new cars can't trade in their really beat up clunkers for the good clunkers that got traded in .. for free .. and let the dealers trash the beat up clunkers.

[CyCarConsulting]

Where have all the Clunkers gone?

Apparently not that far. Dealers are holding on to them until they are reimbursed. Some have not disabled the cars yet for fear of being stuck without the money. So then what? If they end up at the yards, there is a 6 month period to strip the car of its saleable parts, excluding the drive train, before crushing the rest.
If the dealer is stuck with the car, and it runs decent, it will be remarketed ,or wholesaled at a dealer auction ,for much more than the salvage value.
From what information I can get ,I estimate that less than 1% of the cars were sent to the scrapper so far.

[sjc_1]

Business runs on 30,60 and 90 day terms for payment. In this case the government needs to get them the money in a few weeks at the most. Many dealers are counting on this money and it will get to them in a timely fashion, if they have filled out all the forms correctly.

Bush gave away $140 billion in checks to tax payers in January 2008 that did not show up for months. This time the money will go to dealers that got polluting gas guzzlers off the road. It did more than sell foreign made big screens at Wal-Mart.