Let’s not kid ourselves, the cash is the important part. And though the CARS legislation requires the DOT to refund dealers for their clunker deals within ten days, Automotive News [sub] reports that it just ain’t happening. Transportation Secretary Ray LaHood said last week that the bugs had been worked out of the CARS computer system, and the National Auto Dealers Association concurred. “There are kinks still left in the system, but they, too, are being worked out,” NADA spokesfolk said at the time. Turns out they spoke too soon.
“They’re angry and nervous,” is how NADA is characterizing dealer reactions today. “They’re getting fed up with the program.” A number of dealers explain that they are still waiting for refunds worth tens of thousands to hundreds of thousands of dollars. “I’m worried the government will run out of money before we get paid,” says one, a California dealer with $374K worth of claims older than the ten-day limit and nearly $2 million in total unpaid claims. Yikes!
Typical government planning, forethought and efficiency. No offense to those government employees that aren’t ignorant, fat, and lazy of course… :)
And this is the same government that wants to control your healthcare.
I have a coworker who is stuck in C4C limbo due to a dealer’s fears of not getting paid.
His dealer (Toyota of Wallingford, CT) allegedly will not let him take delivery of his new Scion until the DOT pays up on the C4C money from his trade.
As he put it, “I’m stuck between two people not known for doing the right thing — A car dealer and a bureaucrat.”
To be fair that California dealer with $374k worth of claims older than the ten-day limit may be really sloppy with its paperwork.
I don’t know the answer….maybe it’s due to sloppy paperwork, maybe it’s due to government incompetence. Either way what both the NADA and government say should be taken with skepticism.
C4C is optional…..so if Joe Dealer doesn’t want to deal with the paperwork I’m sure someone down the street will be happy to take up his slack.
My dealership group of 14 stores hasn’t been paid a penny yet. My store alone has over 40 cars out on this program – almost $200k x 14 stores! Needless to say, our entire group has stopped further deliveries until we get paid for what we have already delivered.
How does the government expect these businesses to float that kind of money?
Just read an article about how a good portion of C4C is going to F-150s and other “non-green” vehicles. I’d be laughing my ass off, but I know that fact is just going to get us that much closer to our nutless, oops, I meant fearless leaders moving away from trying to use incentive to lure the masses into auto castraion and instead force us outright. *sigh*
“And this is the same government that wants to control your healthcare.”
and
“…will not let him take delivery of his new Scion until the DOT pays up….”
Scary combination.
dwford, you asked, “How does the government expect these businesses to float that kind of money?”
Well, do what they do and fire up the printing presses!! WOO-HOO!!
I was at one of the local Honda dealers and before the salesman would take me to a car or talk about a test drive he rambled on and on about doing the C4C deal sooner than later because his boss was going to terminate the program until they got paid. He said they had a fixed number of deals to write out of the “second bill” until payments from the first bill came in and they were only a handful away.
I couldn’t tell if he was trying to pressure me into a deal on a car we hadn’t talked about or scare me off. He also said the dealership was making folks sign some form of promissory note for the clunker cash amount in the event the feds denied the claim they could then come after you.
The Honda Fit I drove was such a relative piece of crap anyway it doesn’t matter…between no center armrest/console and the obnoxious clattering noise from the slug of an engine in that thing I don’t know why it sells. I’m not a Honda guy but have always respected the company and its ability, and the Fit is most definitely sub-par.
“How does the government expect these businesses to float that kind of money?”
Why, they expect you to borrow it from all their banking buddies they gave those BILLIONS of taxpayer dollars to.
@cdotson:
Honda Fit:
My brother agrees with you – he was never so disappointed in a car test drive. He and his wife were looking for a car for her and found the Saturn Astra better in every way that mattered to them, but in particular — quietness and general comfort. He drives a V8 Audi S4 6 speed quite quickly, so I tend to respect his viewpoint.
Seems like they should just cut out the middle man and have the Chinese government wire transfer the fund to the dealers.
We can also simplify the legislative process. Have congress write bills, then have the Chinese sign them since they are paying. Saves those extra steps of the American people being upset and stuff.
“And this is the same government that wants to control your healthcare.”
Indeed, the CARS voucher program should have been turned over the HealthInsuranceInc to manage. They would have taken 30% off the top, delayed most payments for months and found every way possible to deny claims. Dealers who did too many C4C deals would be summarily informed that they were no longer qualified participants. Meanwhile, the insurance company would bill the government for the cost of not reimbursing the deprogrammed dealerships. Sounds about right.
BTW, there is no bill presently in Congress which proposes that “the government control your healthcare”. Unless, of course, you mean the existing VA, Medicare and Government Employee Insurance programs.
This is supposed to be a cars and car business discussion website.
The Saturn Astra is a decent little car, but I would be very concerned about parts support for it. The Astra is an orphan in North America and shares very few parts with other GM North America vehicles. It’s parent company Saturn is in a weird limbo as Old GM and Penske negotiate some kind of a deal.
Could be worse. California is asking businesses to pay taxes on the IOU scrip!
“Small businesses that received $682 million in IOUs from the state say California expects them to pay taxes on the worthless scraps of paper, but refuses to accept its own IOUs to pay debts or taxes.”
http://www.courthousenews.com/2009/08/04/California_Won_t_Accept_Its_Own_IOUs.htm
Addendum….so I went with my mum to a dealer to look at cars for her 2000 Lincoln Continental clunker trade-in (sole owner w/235,000 miles).
Turns out that this Honda dealer is now requiring all cars purchased with C4C dollars to be held at the dealer until the funds were received from the gov’t WHILE SIMULTANEOUSLY the dealer would store the clunker trade-in at their lot. So to clarify, you buy a new car today, leave your clunker with them and only get your new car once the C4C rebate is recevied by the dealer.
In classic sketchy-car-sales-tactic-form, the dealer’s adverts, website and e-mail quote failed to inform you of this important fact. The sales manager said that the process would take anywhere from 8 to 14 days (or whenever it arrives).
Naturally, I told my mom to look elsewhere. Looks like an opportunity for the most fiscally strong dealers to pick up lots of business by floating the rebate to buyers while the dealers that rely most on floorplan/credit lose sales like dwford mentioned at the beginning of the thread.
Slateslate, you were right to keep shopping around. There are plenty of dealers and vehicles to choose from in most markets. Did you mom finally end up doing a deal? If so, for what vehicle?
@John Horner….
My mom thinks the CR-V looks “cute.” So I’m tagging along to make sure she doesn’t buy the simonizing, lol.
In my area (Chicago), literally nearly all of the 2009 2WD CR-Vs are gone. We only went to this particular dealer because they had one CR-V 2WD..
So since this lead for a 2WD was a dead-end, she’ll probably get the CR-V 4WD (lots and lots of unsold 4WD CR-Vs in the area….looks like C4C cleared out the 2WD CR-Vs). Very nice, but 4WD is overkill for her.
I wanted mom to at least test drive the Tiguan and Vue, but she wouldn’t because of her quality preconceptions/misconceptions even though she thought that those cars looked very cute (we were a GM family ’til the 90’s). See GM/VW, people remember forever and get set in their ways!
And as a quick note to anyone who is reading and in the same boat, Hyundai Santa Fe and Sonata are really shockingly nice (except for hard plastic arm rests) and aggressively priced with generous rebates.
Contingent deals are explicitly disallowed under the CARS program.
Dealers pulling these shenanigans are actually putting themselves at risk of losing access to CARS.
http://www.cars.gov/faq#category-03-5
Do they destroy the engine before they get the payment from C4C or after? Because if they F up an engine and then don’t get the money, someone is going to be very unhappy. Or else an engine is getting replaced for free.
Indeed, the CARS voucher program should have been turned over the HealthInsuranceInc to manage. They would have taken 30% off the top, delayed most payments for months and found every way possible to deny claims. Dealers who did too many C4C deals would be summarily informed that they were no longer qualified participants. Meanwhile, the insurance company would bill the government for the cost of not reimbursing the deprogrammed dealerships. Sounds about right.
BTW, there is no bill presently in Congress which proposes that “the government control your healthcare”. Unless, of course, you mean the existing VA, Medicare and Government Employee Insurance programs.
This is supposed to be a cars and car business discussion website.
Dude, open your eyes and read the bill and it’s control of health care. For all your complaining about insurance companies, just wait until the Federal government is in charge. Just think the DMV… to be related to the car and car business discussion! LOL
TJ’s comment was right on!
Airhen: Dude, open your eyes and read the bill and it’s control of health care. For all your complaining about insurance companies, just wait until the Federal government is in charge.
So, you’ve read through the 5000-page bill and know this?
John Horner is correct.
I am still finding it absolutely disgusting that we’re killing the engines of these “clunker” cars as part of gov mandate. So, anyone left with one of these cars will have a hell of a time getting parts. I don’t know about the rest of you, but an old car getting 18mpg vs a new one getting 21 doesn’t really justify the creation of all that vehicle, and do we all really need SUV’s and giant pickups? They’re purpose vehicles, if you have 7 kids (so sorry if you do) then get a huge suv and drive it with them in it. If you have a huge diesel pickup drive it with a 5 horse trailer behind it, or a 5th wheel. Don’t tool around town shooting out black smoke like it’s something we all enjoy hearing and seeing.
When was the last time you mailed in a rebate and got money back in a reasonable amount of time? It’s been what, a couple weeks?
Since this is public money and several thousand, I’d certainly want them to check the claims a bit more than $20 on a keyboard.
slateslate…
The dealer has to destroy the clunker before submitting the forms. If they let your mom hold it, then there is a good chance that they won’t get paid, and they get fined.
Regarding holding the new car until they get paid. I think that is not allowed. She might want to file a complaint about that with the cars.gov staff.