Hurry up. This is your last chance to trade in the old Explorer for more than it's worth.
The AP reports, "The Obama administration plans to end the popular $3 billion Cash for Clunkers program on Monday at 8 p.m EDT."
The New York Times explains, "Since the Transportation Department finalized the rules for the Car Allowance Rebate System, as it's formally known, consumers have been flooding dealerships to take advantage of the program. The initial funding of $1 billion disappeared after the first week, which led to the Senate approving an additional $2 billion." In recent days, car dealers have begun to warn that even that funding may have run out.
The National Automobile Dealers Association asked the government to consider ending the program Thursday, when a survey of its members showed that the total backlog of unprocessed applications for vouchers may have exceeded the available funding. Dealers have completed sales and submitted applications for vouchers much faster than the Transportation Department has been able to process them.
Many dealers have pulled out of the program, fearing that they have exposed themselves to too much risk in completing deals before the government has paid the vouchers. The Times notes, "The Greater New York Automobile Dealers Association, which represents dealerships in the New York metro area, said that about half its 425 members had left the program because they cannot afford to offer more rebates."
Automakers, anxious to prolong the success of the program, have attempted to close the gap. General Motors, Fox News notes, "announced Thursday that it will immediately start providing ‘cash advances' to dealers equivalent to the rebates that are being processed, and will do so for the duration of the program." According to Fox, "A White House spokesman said Toyota and others have also stepped up to guarantee the rebates so that dealers can continue the program."
Because of the guarantees, there are still dealers willing to complete Cash for Clunkers trade-in deals. The Washington Post reports, "With the end in sight, many dealers are preparing for a flurry of last-minute customers over the weekend, and some are calling and e-mailing customers who were on the fence, perhaps threatening a surfeit of business." NADA Chairman John McEleny told the Post that "he had been assured that the government has done calculations to make sure there is enough money left to get through the weekend."
It appears that there is little chance of the program receiving a new infusion of funds, according to the Los Angeles Times. An unidentified "administration official" speaking on condition of anonymity told the Times there is "no plan to seek additional funding."
If you're interested in the Cash for Clunkers program, check out our Cash for Clunkers page. If you're ready to buy, contact local dealers. For the latest news on the program, check out Cash for Clunkers news.
