Cash for clunkers could be shifting to neutral

Reported by Casey Roman - blog|email
Posted by Debra Worley - email

WILMINGTON, NC (WECT) - The government's popular "cash for clunkers" program is running out of money after only a matter of days as car shoppers flocked to dealerships to take advantage of the rebates.

The program offers new car buyers a rebate of up to $4,500 if they traded in their clunker.

Sellers at Naber Dealership in Wilmington were thrilled to see the program double the number of buyers on their lot.

"[We're] selling them faster than we can replace them," said Terral Altman of Naber Chrysler Dodge Jeep Dealership.

The plan has worked a little too well - the $1 billion in federal rebates are almost gone and the program may shift into neutral.

Dealers are hoping the government offers more funding to keep the sales going, but some dealers have decided to fuel the program themselves.

"Whatever it takes," said Altman.  "If I've got to give you $4,500 for your clunker I'll do whatever it takes to get your business."

Altman says, "a deal's a deal," so for now customers can still count on cash for their clunkers, even if the government's program clunks out.

White House press secretary Robert Gibbs said they were working to "assess the situation facing what is obviously an incredibly popular program. Auto dealers and consumers should have confidence that all valid CARS transactions that have taken place to date will be honored."

Before going on its August break, the House voted to pump in another $2 billion in unused stimulus money.

While several Republicans supported the bill, others called it another expensive bailout for the auto industry.

"Maybe we should have a cash for cluckers program and pay people to eat chicken," said Texas Rep. Jeb Hensarling.

"We decided to give out free money and now we're surprised when people take advantage of it and love the program," said Arizona Rep. Jeff Flake.

The Senate has not voted on the additional money for the program yet - that will happen next week.

The White House said Friday the rebates would continue to be available to consumers through the weekend.

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