Some Dealers Having Problems with Cash for Clunkers

by ekramer on August 24, 2009

The government’s Cash for Clunkers program, ends at 8 tonight.  Some local auto dealers say it’s definitely created a buzz — but they’re not quite ready to call it a success. WFPL’s Elizabeth Kramer has more.

Car dealers around the region say that the program has brought more customers to their showrooms and moved hundreds of cars off their lots. Louisville’s Sam Swope Auto Group reports it sold about 300 cars at its 15 auto outlets through the program.

Dan Bates is Sam Swope’s vice president and general manager. Still, he says problems have overshadowed the sales — particularly how one defines the word “sales.”

“Sales as defined by customers driving home in vehicles, it’s been great,” he says. “Sales if it’s defined as us getting paid — that’s a different story.”

Bates says the primary problem has been submitting the paperwork for the program via the National Highway Traffic Safety Administration’s web site. He says the site was down on Monday, and, so far, Sam Swope has received reimbursements for less than 10 percent of vehicles sold through the program. The government says it’s hiring more employees to process claims and assures car dealers they will be reimbursed.

Federal transportation officials are reporting dealers have turned in 625,000 vouchers to cover the rebates they offered customers for their old cars.

Bates says he’s found trying to work the logistics of the program very frustrating, including the way it has communicated with auto dealers, which, he says, has been primarily through press releases.

“Everything we’ve heard about the National Highway Traffic Safety Administration’s effort to ramp up their ability to process transactions hasn’t really resulted in much of an increase in the efficiency of their systems,” he say. “We’re having difficult submitting transactions now, and that’s been par for the course throughout the program.”

He says the problems with the program aren’t jeopardizing Sam Swope’s operations.

“Are we going to continue to operate? Yes, absolutely,” he says. “But, let me tell you, there are a number of dealers out there that’ll wind up going out of business if something isn’t done for them.”

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