Dealers to keep offering Cash for Clunkers this weekend

Despite its confusion and funding concerns, Augusta-area new car dealers said they’ll continue to participate in Cash For Clunkers over the weekend.

“We decided that based on the latest information we have, we would at least continue today and tomorrow. After that, I’m not sure, but we’re going to continue the Cash for Clunkers through this weekend,” said Bud Lawrence, the general manager at Bobby Jones Ford.

“We may continue past that, but we’ll wait to hear from somebody from the Obama administration or GADA until we feel comfortable to continue or not continue past Saturday,” he said.

The House voted overwhelmingly today to rush $2 billion into the popular but financially strapped car purchase program, heeding calls from consumers eager to keep taking advantage of thousands of dollars in trade-in incentives.

House members approved the measure 316-109 within hours of learning from Transportation Secretary Ray LaHood that the program was running out of money.

Senate action is likely next week, ensuring the program won' be affected by the sudden shortage of cash.

Called the Car Allowance Rebate System, or CARS, the program is designed to help the economy and the environment by spurring new car sales. Car owners can receive federal subsidies of up to $4,500 for trading in their old cars for new ones that achieve significantly higher gas mileage.

There had been a $1 billion budget for rebates for new car sales in the program that was officially launched last week and has been heavily publicized by automakers and dealers.

House Majority Leader Steny Hoyer said the new money for the program would come from funds approved earlier in the year as part of an economic stimulus bill.

"Consumers have spoken with their wallets, and they've said they like this program," said Rep. David Obey, D-Wis.

At the White House, press secretary Robert Gibbs sought to assure consumers that the program was still running and would be alive "this weekend. If you were planning on going to buy a car this weekend, using this program, this program continues to run."

It was unclear how many cars had been sold under the program.

Sen. Debbie Stabenow, D-Mich., said about 40,000 vehicle sales had been completed through the program but dealers estimated they were trying to complete transactions on another 200,000 vehicles.

John McEleney, chairman of the National Automobile Dealers Association, said many dealers have been confused about whether the program will be extended and for how long. Many had stopped offering the deals Thursday after word came out that the funds available for refunds had been exhausted.

The clunkers program was set up to boost U.S. auto sales and help struggling automakers through the worst sales slump in more than a quarter-century. Sales for the first half of the year were down 35 percent from the same period in 2008, and analysts are predicting only a modest recovery in the second half.

So far, Bobby Jones Ford has completed 11 or 12 Cash for Clunkers deals, Mr. Lawrence said.

The program is confusing, however, and there have been issues since the beginning, he said. For instance, the dealership had difficulties bringing up some vehicles in the system, so they couldn’t determine if they would qualify for the $3,500 or $4,500 rebate, Mr. Lawrence said.

“Everything about it was way too complicated. There’s going to be a lot of mistakes, and all of them are really going to be the responsibility of the dealer. Once we commit to giving that customer the $3,500 or $4,500 for the clunker, then it’s our responsibility to collect from the government,” Mr. Lawrence said.

But it has brought people into the showroom, he said, and created opportunity for the dealership.

“It’s a good deal, and people are trying to capitalize on it. But because of the confusion of the program, the whole process has not been very smooth at all,” he said.

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