August 19, 2009

Auto dealers ask, ‘Where’s the cash?’

U.S. auto dealerships are complaining that a backlog of cash for clunkers applications is slowing reimbursement of money they have put on the line.

It is ludicrous at this point, Peter Kitzmiller, president of the Maryland Automobile Dealers Association, told The Washington Post Wednesday. We've got deals that are just sitting there waiting to be reviewed. The customer is gone, the car is gone, and you don't have your money.

The federal program granting car buyers rebates up to $4,500 for trading older cars for new, more fuel-efficient models, was overwhelmed with a large portion of the initial $1 billion budget spent in a week.

Congress extended the program with an additional $2 billion. Now dealerships are asking where's the money?

Maryland dealerships are owed $36 million in rebate claims, Kitzmiller said. One dealership alone, Darcars Automotive Group, says it is owed $5 million, the newspaper said.

The National Highway Traffic Safety Administration said it is adding workers to speed up processing.

The government said 411,624 claims worth $1.7 billion have been submitted so far.