With the end of the government Cash for Clunkers program in sight, auto dealers are asking "where's the cash". Around the U.S. dealers are speaking up.
This government program was to provide payment to dealers who participated within 10 days after they sold a car under this program. Some dealerships are holding invoices due from the government of up to one million dollars!
Meanwhile, the program was refunded because the public was told the money had been used in the first week of the program. How was it used if the payments aren't being made?
This program was popular with those people who could afford to buy a new car in this economy and had squeaky clean credit. They got $4500 off the price of a new car.
The use of the word clunker is a bit misleading. Many of the cars taken in trade - and destroyed - were perfectly usable vehicles. It's likely future reports will reveal many abuses of this program and black market selling of the cars or parts taken from them. That's the opinion of both dealers and critics of cash for clunkers.
Had this program resulted in significant savings of natural resources, it might have been worthwhile. In fact, many of the cars traded in were rated only 4-5 miles per gallon less than the new models.
The numbers don't add up. The government reports 457,000 sales under the Cash for Clunkers program - but even if every sale was at the maximum payout of $4500 (unlikely) there should have been over 650,000 sales. It would seem about one billion dollars of borrowed money has just disappeared.
The Cash for Clunkers program is being called a "success". That's an interesting designation for a program where usable, inexpensive vehicles were destroyed, 3 billions dollars of borrowed money spent and the bills haven't been paid.