Reply to "Cash For Clunkers Program is a Clunker!"

...just posting a couple of "clunker news" updates:

One-third of clunkers buyers weren't in market, study says
Chrissie Thompson
Automotive News
September 21, 2009 - 12:01 am ET

About a third of customers who participated in the cash for clunkers program would not have purchased any vehicle without the government incentive, a new study says.

In a survey conducted by consumer site Cars.com, 30 percent of cash for clunkers buyers said they had not planned to buy a vehicle at all, but were lured to showrooms by the $3,500 or $4,500 government rebates.

The survey showed the government rebate appealed to consumers who were waiting for better economic times to buy new vehicles, along with those who had not previously intended to buy a car, Cars.com Editor-in-Chief Patrick Olsen said.

“The program certainly had its desired effect,” he said in a statement.

The program helped boost August U.S. light-vehicle sales to their first year-over-year increase since October 2007. Demand hit an 11.1-million-unit annual rate in July and a 13.7-million-unit rate in August. Through June, the sales rate hand not exceeded 9.9 million this year.

Cash for clunkers buyers made up two-thirds of the 1,056 study participants, who had all either purchased a vehicle in the past three months or plan to buy one in the next six months.

Eighty percent of those surveyed said they were satisfied with the way the cash for clunkers program operated. That compares with complaints from dealers, many of whom are still waiting for reimbursements for the consumer vouchers, about problems with the program's online system, customer service line and paperwork.

Fifty-five percent of survey respondents said they wish the government would continue the program, which officially ran from July 24 to Aug. 24. It gave consumers rebates for turning in gas guzzlers for new vehicles with better fuel efficiency.



U.S. says 90% of clunker claims have been approved
Neil Roland
Automotive News
September 21, 2009 - 3:59 pm ET
UPDATED: 9/21/09 5:10 p.m. ET


The U.S. Transportation Department says it has paid or approved $2.6 billion in cash-for-clunkers transactions, or 90 percent of the $2.9 billion submitted, as accelerated payments to dealers continue.

A total of 534,598 claims for $2.3 billion were paid as of Sept. 18, said a posting today on the federal cars.gov Web site. An additional 76,775 submissions for $322.3 million have been approved but not paid yet.

A claim approval is the next-to-last step before the Treasury Department wires payment to the dealer's bank.

The latest figures show that Transportation may have to pay 146,828 claims for $615.1 million if it is to meet Secretary Ray LaHood's Sept. 30 deadline for payment of all properly filed submissions.

Many of these unpaid claims include those that were rejected and resubmitted. Claims that were rejected before the Aug. 25 filing deadline can be re-entered at any time.

"There's no question that DoT is pushing the 'pay' button significantly more as of late," said Bailey Wood, a spokesman for the National Automobile Dealers Association spokesman. "They're likely to come very close to meeting the Sept. 30 deadline."

LaHood's spokeswomen did not immediately respond to a request for comment today.

A total of 681,426 deals for $2.9 billion were entered between July 27 and Aug. 25.

Coming soon

Earl Stewart, a Toyota dealer in North Palm Beach, Fla., said he expects to be totally reimbursed for his $1.2 million in claims either today or tomorrow.

As of Sept. 10, Stewart had been paid only $464,500 and was owed $774,500, he said.

"Somebody really fired the retro-rockets!" he said.

The Sept. 18 figures posted today show that $190.6 million in claims were paid or approved in the two days since LaHood said the agency would make extra efforts to process claims.

He said last week that to resolve potential problems more quickly, federal employees would be calling dealers rather than just e-mailing them with questions about individual claims.

A number of dealers have complained that their initial claim was rejected for one reason by one processor, then resubmitted and rejected for another reason by a different processor.

The reimbursement rate started accelerating in early September after LaHood doubled the staff that is processing dealer applications.