Dealers ready to be restocked, repaid after 'clunkers'

By Alex Gary

BusinessRockford.com

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ROCKFORD — The final day of the government’s “cash for clunkers” program was a busy one at local new-car dealerships.

Still, it wasn’t nearly as crazy as the last week of July — but only because dealers had few new cars to sell.

Now dealers are in a waiting game — for new models from manufacturers and reimbursement from the government.

“I don’t have any (Ford) Focuses, Fusions or Escapes,” said Scott Bryden, owner of Bryden Ford in Durand.

Dave Lusz of Anderson Dodge, Chrysler, Jeep was out of available qualifying cars by early August, and Randy Alex of Anderson Toyota Scion was down to five new Toyotas of any kind.

“If there is one thing I wish, it was the government had come up with this program last December and January,” Alex said. “That was when inventories were at record levels.”

Because of the slumping economy, all major auto manufacturers had slashed production when cash for clunkers caused a surge of sales.

Transportation Secretary Ray LaHood, speaking to reporters in Norristown, Pa., called the program an unprecedented success and a boon for car dealers, automakers, scrap yards and financial institutions. Transportation officials said that through early Monday, U.S. dealers had submitted 625,000 vouchers totaling $2.58 billion and expected to work up to the deadline to submit the proper paperwork.

But the new sales left many dealers worried about not being reimbursed by the government. As of Friday, dealers had been reimbursed for just a fraction of the billions in sales. Some dealers chose to stop participating over the weekend so they would have enough time to process and file the paperwork, including AutoNation Inc., the nation’s largest auto dealership chain.

Lusz of Anderson Dodge, Chrysler, Jeep had been reimbursed for about 30 percent of his dealership’s sales. That was far better than Bryden, who hasn’t received any of the money he is owed.

“That’s a huge cash crunch for us right now. We’re waiting on tens of thousands (of dollars),” Bryden said. “But in the end, if someone had told me a couple of months ago that I could sell all of my new cars in one fell swoop but have to put up with a few headaches, I would have said ‘go ahead.’”

Although dealers in general were happy that the government program put people back into a buying mood, Lusz said he believes most are glad it’s ending.

“By the time you tripped and felt your way through all the rules and regulations, it was pretty good. But all it really was, was a rebate program, and we’ve been doing that for 30 years,” Lusz said. “If you asked, most dealers would say they are happy that the government will get out of our business.”

Reach Assistant Business Editor Alex Gary at agary@rrstar.com or 815-987-1339.

RECENT NEWS
Aug. 13: 'Clunkers' yields some not-so-green vehicles
Aug. 7: So what will they do with all those clunkers?
Aug. 6: Clunkers goals puzzle local used-car dealers
Aug. 3: 'Cash for clunkers' gives big boost to Belvidere-built vehicles
Aug. 3: Cash for clunkers boosts July U.S. auto sales
July 31: Local inventories might be short for 'clunkers'
July 31: House approves $2B more for 'clunkers'

ON THE WEB
Blog: Go Green
Car Allowance Rebate System's Web site
Follow news on 'cash for clunkers'
Newsweek: 'Cash for clunkers' a lemon for some

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