"Cash for Clunkers" Program a Success, But Out of Cash After Just One Week

The much-hyped federal "Cash for Clunkers" program may have been a victim of its own success. After just one week up and running, the program may have already run out of cash and some congressional officials have said that the House of Representatives may look into passing some kind of legislation to release more money into the program today, the last day of the session before the August recess begins.
Thursday evening the Department of Transportation told lawmakers it was suspending the "Cash for Clunkers" program at the stroke of midnight, but later the White House said it was still working to find other options. This created some confusion for both dealers and buyers.
The "Cash for Clunkers" program was supposed to run until Nov. 1, 2009, or until the money ran out. No one anticipated that it would run out so quickly. With the number of dealers participating in the program, the $1 billion would have been spend if each completed a dozen cash for clunkers deals. However, some dealers have made more in the range of 250 deals, 20 times what the government expected.
Now dealers are in a race to complete cash for clunker deals before the government runs out of cash and shuts down the program.
One of the problems, however, is that dealers entering information are experiencing a lot of technical problems. While the program's website still shows that funds are available, it is estimated than more than 25,000 transactions haven't yet been reflected there. Dealers are now worried that they will execute the deals, only to find out later that there is no money left and they will be left to deal with unpaid government rebates.









Comments
Post new comment