Top Cash for Clunkers Trade-Ins and New Cars

Dealers are also stealing money from customers by offering 2 prices. 1 with and 1 without a cash for clunkers car.

The markup is about 1000-1500 for a car purchased with cash for clunkers to "cover their costs". :rolleyes:
OH well i mean if customers are stupid enough to pay for that then so be it.
 
Cash for Clunkers success limited by program flaws

http://autos.yahoo.com/articles/aut...vZGF5BHNsawNjbHVua2Vycy1zdWNjZXNzLWxpbWl0ZWQ-

Cash flows to car buyers, but the government bureaucracy proves to be biggest clunker
By Stephen Manning
WASHINGTON (AP) -- It's revived business at car dealerships, taken gas-guzzlers off the road and given a badly needed boost to struggling auto factories. By many measures, the government's Cash for Clunkers program has been a success.

Yet as it winds down, there is another lasting image: the hasty planning and troubled execution that nearly derailed the program early on and, lately, has led some frustrated dealers to drop out amid long waits for the government money.

The responsibility for the $3 billion stimulus program's flaws is widely spread.

Congress relying on auto industry forecasts that the program wouldn't have a major effect on moribund sales -- deeply underestimated how many people would be lured to dealerships by rebates of up to $4,500. Initially, lawmakers committed just $1 billion, an amount that was burned through in just a few weeks.

Transportation Department officials, presented with just 30 days to get the program up and running, didn't set aside enough staff or resources and were overwhelmed by the heavy response from consumers. Systems set up to handle and reimburse dealer claims were swamped.

Government rules to prevent fraud created paperwork requirements that many dealers didn't fully understand.

Hungry for sales, dealers made Cash for Clunkers deals weeks in advance even though they were advised against it. This created a big backlog the moment the program officially began. And many are still filing bad paperwork that is holding up their claims, despite repeated government attempts to clear up the confusion.

Dealers are thrilled with the revived sales, but say the lesson learned is clear -- more time and planning was needed to make Cash for Clunkers a true success.

"I love the sales, but the bureaucratic end of it is very problematic, very frustrating and very unnerving," said Scott Addison, an executive with the suburban Washington-based Fitzgerald Auto Mall dealership chain.

Cash for Clunkers will end Monday evening, the Transportation Department said Thursday, saying dealers must have all their claims filed by then in order to be repaid.

President Barack Obama declared the program a success Thursday, and government officials stress that dealers who get their claims in will be repaid.

Approved in June, the program seemed straightforward. Dealers would offer rebates to customers seeking to trade in older vehicles for new, more fuel efficient car and trucks. The dealers would front the money and then be reimbursed by the government.

It has been a huge hit with car buyers. About 450,000 new vehicles have been sold so far under the program, worth nearly $2 billion. That is far more than original expectations of analysts, who believed that Cash for Clunkers would provide only a small bump in sales.

Automakers are scrambling to fill depleted inventories of the Fords, Toyotas and Chevrolets that are the most popular sellers. General Motors has added shifts at some plants to handle the extra demand.

But Cash for Clunkers, has also been a bureaucratic headache.

Congress only set aside about a month for the program to get up and running and picked the National Highway Transpiration Safety Administration, which specializes in road safety and vehicle recalls, to run it. The agency, known as NHTSA, had never run a program like this before. It devoted 30 employees and 200 contractors to handle the program -- and they were swamped almost from the moment dealers' applications began rolling in.

"We were not anticipating the number of transactions would be anywhere near what it is at this point," said Daniel Smith, the NHTSA associate administrator overseeing the program in a recent information session with dealers.

The agency has tried to fix problems as they arise. It has tripled the staff working on the program to 1,100, beefed up the computer system and eased some rules that dealers found especially time consuming. Dealers say the agency has been responsive to problems.

Part of the reason for the backlog in paperwork is that dealers ignored government warnings and started cutting Cash for Clunkers deals weeks before the program officially began. There were thousands of sales waiting to be processed when the program began July 27.

Moreover, many shoppers were buying vehicles that were much more fuel efficient than their trade-ins making them eligible for the higher $4,500 credit. That meant the original $1 billion couldn't go as far.

The government's computer system was also overwhelmed. Some dealers brought staff in after midnight to try to scan and send documents, only to have the online system crash. Transportation officials eventually improved the computer system to smooth the claims process.

But many of the problems lie with the dealers. For example, many cash for clunkers deals weren't approved because dealers didn't write "Junk Automobile, Cars.gov" in black magic marker on the title of the older cars that buyers were trading in.

Government officials say the tough rules are needed to prevent fraud.

"Part of the problem is...some of the information was not provided to us. The application or the form that needed to be filled out by the car dealer was inadequate and we had to send it back to them. That caused a great deal of delays," said Transportation Secretary Ray LaHood.

Regardless, dealers often have to wait up to 10 days just to find out that a claim has been rejected, meaning they have to start over. And just 167,000 of the 458,000 applications had been reviewed as of Thursday, creating a huge backlog.

The government had estimated each dealer would make only about 12 sales under the program. But a NADA survey showed that dealers were making about 14 sales each, with some making more than 100. The survey, sent to lawmakers and the White House late on July 30, showed that the program was running out of cash fast.

In Washington, that news created broad confusion, prompting Congress to add another $2 billion. But problems persisted, as dealers reported they were fronting rebates worth millions of dollars without getting repaid. That created a cash crunch for many.

LaHood said this week that all dealers will be repaid, and companies like GM are stepping in to help dealers with cash flow. But some in states like New York are starting to pull out of Cash for Clunkers, saying they can't afford the long waits.

"The program is choking on its own success," said Connecticut Attorney General Richard Blumenthal, who sent a letter Thursday to LaHood asking it to reform Cash for Clunkers. "It expanded exponentially without sufficient basic preparation."

Associated Press Writer Ken Thomas in Washington contributed to this report.

Copyright © 2007 The Associated Press. All rights reserved. The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press.
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Dealers can bitch and moan all they want, I am sure they will get their money soon. They were upcharging (raping) customers on the C4C program as of late... They are going to come up quite on top.
 
oh well, really was never a supporter of the program so no big for me.

I am confused though, I wonder why there is not a single diesel model on that top ten bought list. If I had a clunker, and was looking to get a nice daily driver that would get good mileage, I'd get a Volkswagen Jetta TDI (only non truck diesel I can think of that is sold stateside).
 
So I took the dog for a walk and the Chevy dealer's lot around the corner from me look almost empty. Anyone else see dealers by them with almost empty lots too? The program ends tomorrow at 8:00 PM.
 
jbird97 said:
oh well, really was never a supporter of the program so no big for me.

I am confused though, I wonder why there is not a single diesel model on that top ten bought list. If I had a clunker, and was looking to get a nice daily driver that would get good mileage, I'd get a Volkswagen Jetta TDI (only non truck diesel I can think of that is sold stateside).
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Mercedes, too. Also, BMW diesels seem to be making their way here, finally. I saw an X5 drive away last week that sounded like a school bus....
 
Cash for Clunkers generates 700K new car sales

http://news.yahoo.com/s/ap/20090826/ap_on_bi_ge/us_cash_for_clunkers

Cash for Clunkers generates 700K new car sales
By KEN THOMAS and STEPHEN MANNING, Associated Press Writers Ken Thomas And Stephen Manning, Associated Press Writers 11 mins ago

WASHINGTON – Cash for Clunkers generated nearly 700,000 new car sales and ended under its $3 billion budget, the Transportation Department said Wednesday.

Releasing final data, the government said dealers submitted 690,114 vouchers totaling $2.88 billion. New car sales through the program ended late Monday and dealers were allowed to submit paperwork to the government until late Tuesday.

Japanese automakers Toyota, Honda and Nissan accounted for 41 percent of the new vehicle sales, outpacing Detroit automakers General Motors, Ford and Chrysler, which had a share of nearly 39 percent. Toyota Motor Corp. led the industry with 19.4 percent of new sales, followed by General Motors Co. with 17.6 percent and Ford Motor Co. with 14.4 percent.

The Toyota Corolla was the most popular new vehicle purchased under the program, followed by the Honda Civic, Toyota Camry and Ford Focus.

Transportation Secretary Ray LaHood said U.S. consumers and workers were "the clear winners" under the program. "Manufacturing plants have added shifts and recalled workers. Moribund showrooms were brought back to life and consumers bought fuel-efficient cars that will save them money and improve the environment," he said.

The White House Council of Economic Advisers said the program will boost economic growth in the third quarter by 0.3 to 0.4 percentage points because of the increased auto sales in July and August. An estimated 42,000 jobs will be created or saved during the second half of the year, the White House said.

The program, which began in late July, offered consumers rebates of $3,500 or $4,500 off the price of a new vehicle in return for trading in their older, less fuel-efficient vehicles. The trade-in vehicles needed to get 18 miles per gallon or less and were then scrapped.

It proved far more popular than lawmakers originally thought. Congress was forced to add another $2 billion to the original $1 billion budget when the first pot of money nearly ran out in a week. The extra money was supposed to last through Labor Day, but in the end, Cash for Clunkers ran only about a month.

Dealers loved the new sales, but reported major hassles trying to get the government to repay them for the rebates they gave customers. The government extended the deadline for them to file deals, but many still haven't received their money.

Peter Kitzmiller, president of the Maryland Automobile Dealers Association, said most dealers appeared to get their paperwork in by the Tuesday night deadline. He expressed hope the pace of repayments would pick up now that government officials are working through the backlog.

The Transportation Department said Wednesday that 2,000 people are processing dealer applications, but Kitzmiller said the rate of repayment hasn't increased. "I'm a little concerned that we haven't seen any improvement," he said.

The government said 84 percent of the trade-ins were trucks and 59 percent of the new vehicles were passenger cars. New vehicles bought through Cash for Clunkers had an average fuel-efficiency of 24.9 miles per gallon, compared with an average of 15.8 mpg for trade-ins, a 58 percent improvement.

American companies accounted for all the top-10 traded-in vehicles. The Ford Explorer four-wheel-drive was the most popular, followed by the Ford F-150 Pickup two-wheel-drive, the Jeep Grand Cherokee four-wheel-drive and Ford Explorer two-wheel-drive.
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steve said:
Why is that? They still had to trade it in for something new that got better MPG.
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Only marginally better mileage was required for non-passenger vehicles(trucks and SUVs).

I ran through the math before and the DOT's supposed numbers do nothing to convince me this was anywhere near as good as they would like to purport.

If the new vehicle did not get 2-3 times the mpg of the old vehicle, it was not a trade up that has any significant rebate for mileage. When one considers just the interest, increased insurance and taxes, the new owner will be in the red all the while thinking the mileage increase will make up for any additional costs.
 
But now they probably got cars with ABS, TC, front & side air bags, and headlights that they can see with at night. You can’t put a price on your life and safety. :D
Not to mention the savings from longer service intervals, a new car warranty, etc. :)
And nothing beats the new car smell over that of a clunker :p

You can't go by the DOTs MPGs anyway, look how some Marks VIII were eligible and others not and no difference in mileage for LSC gearing. And I know I don't get the same MPG with 134K as I did when I got I new. With my mixed city and highway driving when newer I would get around 20 mpg, now I get around 18.

If people traded in because they thought they would be seeing big money in gas savings then those are the people who probably got a mortgage they could not afford as well. But some people who were on the fence about getting something new anyway probably got helped with the program.

Anyway, if the government is going to use my tax dollars for a bailout, I rather see it go to my working neighbors then the Wall Street companies and their executives. Also they should have just given more rebates to all tax payers to buy a car then bail out GM and Chrysler.

driller said:
Only marginally better mileage was required for non-passenger vehicles(trucks and SUVs).

I ran through the math before and the DOT's supposed numbers do nothing to convince me this was anywhere near as good as they would like to purport.

If the new vehicle did not get 2-3 times the mpg of the old vehicle, it was not a trade up that has any significant rebate for mileage. When one considers just the interest, increased insurance and taxes, the new owner will be in the red all the while thinking the mileage increase will make up for any additional costs.
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Because the 41% of trucks only needed 2mpg more to be "eligible" this program was supposed to get ppl out of SUVs and into gas mising ****boxes ;)

So if you had a 1990 F150 that according to the EPA got 12mpg you can get a new one that averages 14 and get $4500 and you'll continue driving a gas hog.
 
maxmk8 said:
Because the 41% of trucks only needed 2mpg more to be "eligible" this program was supposed to get ppl out of SUVs and into gas mising ****boxes ;)

So if you had a 1990 F150 that according to the EPA got 12mpg you can get a new one that averages 14 and get $4500 and you'll continue driving a gas hog.
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It was not all about MPG but to also boost the economy, but I agree most of what was said was about MPG. And to get the $4,500 on a truck it needed to be 4 MPG better, not 2, the 2 got you the $3,500. With your accurate reporting you can get a job in one of the cable news channels. :p
 
steve said:
If people traded in because they thought they would be seeing big money in gas savings then those are the people who probably got a mortgage they could not afford as well.
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Rest assured there are many who have under-estimated their former mileage and used the over-estimated mileage on the new car to deduce they could AFFORD the payments. Nevermind the interest rate, nevermind the taxes and fees, nevermind the stretched out term - they have been sold a monthly payment for an econobox.

steve said:
It was not all about MPG but to also boost the economy, but I agree most of what was said was about MPG.
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IMHO it was political payback, period.

All the other fluff was such as "improving fuel mileage" to reduce our dependence on foreign oil, "reducing emissions" to help battle global warming, "safer cars" to improve highway safety and "improving the economy" during a recession was pure 'window dressing' on an ill-conceived financial boondoggle financed by the taxpayers.
 
Clunkers aid Ford, Toyota sales; GM, Chrysler fall

Clunkers aid Ford, Toyota sales; GM, Chrysler fall
By KIMBERLY S. JOHNSON and DAN STRUMPF, AP Auto Writers Kimberly S. Johnson And Dan Strumpf, Ap Auto Writers 10 mins ago

DETROIT – The Cash for Clunkers program boosted sales at Ford, Toyota and Honda in August as consumers snapped up their fuel-efficient offerings, but rivals Chrysler Group LLC and General Motors Co. withstood another month of falling sales.

The program, which ended on Aug. 24, drew hordes of buyers into quiet showrooms by offering up to $4,500 toward new, more fuel-efficient cars and trucks. The hefty rebates gave automakers and dealers a much-needed lift, spurring 690,114 new sales, many of them during August, at a taxpayer cost of $2.88 billion.

Other automakers are expected to release U.S. sales figures later Tuesday. Combined, the results are likely to mark the first year-over-year monthly sales gain since October 2007.

Ford Motor Co. sold 181,826 cars and light trucks compared with 115,117 in August 2008, when high gas prices and growing economic uncertainty kept people away from showrooms.

Two of Ford's vehicles — the Focus and Escape — were among the top selling cars under the clunkers program. Sales of the Focus rose 56 percent while those of the Escape crossover vehicle climbed 49 percent.

Japanese automakers Toyota Motor Corp. and Honda Motor Co. also posted gains year-over-year gains in August. Toyota sales rose 6.4 percent to 225,088, lifted by small cars like the Corolla, the best-selling clunkers vehicle.

Honda sales rose 9.9 percent to 161,439, also largely on the strength of its fuel-efficient offerings.

Meanwhile, low supplies of fuel-efficient vehicles at Chrysler kept the automaker from benefiting more from the clunkers program, whose rebates encouraged customers to buy gas sippers in exchange for guzzlers with gas mileage of 18 mpg or less.

Chrysler sales fell 15 percent to 93,222 units.

Going into August, five of Chrysler's most efficient vehicles were already at low inventory levels. Those vehicles — the Dodge Caliber, the Chrysler Sebring, the Jeep Patriot, the Jeep Compass and the Dodge Avenger — all qualified as Cash for Clunkers purchases.

To make up for the shortfalls, Chrysler is boosting production by 50,000 vehicles of most of its vehicles through the end of the year.

At General Motors Co., sales fell 20 percent to 245,550. GM said its inventory levels hit an all-time low of 379,000 during August.

GM vehicles like the Chevrolet Aveo subcompact, the Cobalt sedan and Equinox crossover got a lift from the clunkers program. No GM vehicles made the closely watched list of top-10 Cash for Clunkers sales, but they had the largest market share behind Japan's Toyota Motor Corp.

GM also said it was extending through the end of September its test program selling vehicles on eBay.

Consumers are expected to steer clear of dealers this autumn now that the clunker rebates are no longer available
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Yup as expected. Chrysler has the worst small car lineup and their factories were shut down. Ford/GM are better. Still they don't have any "good" cars to compete with the Japs.
 
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