Auto Dealers Learning That Cash For Clunkers Isn’t Such A Great Deal After All

Proof • August 16, 2009

Let’s put these idiots in charge of health care!

A growing number of auto dealers say the process of getting paid under the government’s “cash for clunkers” plan increasingly resembles some of the wrecks accumulating on their lots as part of the program.
The slow payments coming from the federal government are reinforcing the paradoxical nature of the program for dealers: It has generated the most showroom traffic they have had in months while at the same time heaping unease, frustration and worry onto the industry’s worst-ever downturn.
As of the close of business Friday, there was talk in the industry that some dealers are considering pulling out of the clunkers program altogether.
“A number of dealers have floated $100,000 to upwards of $1 million or more” on the clunkers program, said Bill Sepic, president of the Wisconsin Automobile & Truck Dealers Association.
Dealers say they want to see at least some sign that they will be able to recoup that money. Still others need the money to pay bills and meet payroll.
“This is not a Wisconsin problem,” Sepic added. “This is going on across the country.

They’re upset about the sheer bureaucratic inefficiency of the program right now, but just wait until they realize that “cash for clunkers” didn’t so much subsidize new auto sales as simply convinced people who were going to buy a car anyway in the next year or so to buy one now. We’ve essentially deficit spent $3 billion (and more, probably, when you consider administration fees and overruns) on creating a spike in auto sales now at the expense of future auto sales.
Much like all government dependency and welfare programs, this one actually does more harm to those it was targeted at than help.

Tags: Asshats, Domestic Issues, Politics

http://proof-proofpositive.blogspot.com/ proof_positive

Another lame point… by Buzz.

There! Fixed it for you, Buzz!
docdave

Maybe they should have given more thought to the program and its ramifications especially since they were apparently paying cash upfront and then filing for repayment. Cash flow is the life blood of every company and when it becomes negative your in deep dodo.
http://proof-proofpositive.blogspot.com/ proof_positive

Randy-G: I’ve bought a couple of wrecking yard engines over the years. One was a Pontiac V-8 I used to replace the GM diesel in an old Oldsmobile. The other was for a Nissan 4×4.

Turning two unserviceable vehicles into one serviceable vehicle is a concept apparently beyond little Buzzy’s grasp.
jimmypop

once again a feel-good idea fails……

as i have said here before, we shall see if car sales plummet (which i think will happen). if they do, barry is to blame. and if they dont, we need to give him credit.

then the larger worry….. i hope its as i said before… people that were going to buy cars anyway, did. if not, did we just make room for the poor to spike up to something new? have we have given an incentive for poor people to buy cars they cannot afford (or they would be driving them now)? sound familiar? will we need a barry-new-car-purchase bailout like we had houses?
http://www.biosolutionsarizona.com/ CrimeCleaner

I think time will tell how unsuccessful this cash for clunkers program was, but I couldn’t agree more with what was said. This was truly a “feel good” thing to do that looked pretty good on the surface, but once things slow down you begin to pull back the levels of this whole thing and realize it was a gigantic waste of money.
RC

How fitting…. crooks screwing over other crooks. Somehow I still have more trust in auto dealers than politicians
raj58045

There was a dealer on the news this afternoon who was due $1 million. He said that 85% of the dealers first time claims had been turned down, forcing them to re-apply for these reimbursements several times, and they still haven’t gotten paid. I bet doctors and hospitals can’t wait until they get to go through this to get paid.
RC

And whats worse… they have to destroy the clunkers. By doing this they throw away any chance of getting at least some of their money back if the government defaults on their end of the bargain.

It is unusual I find myself being sympathetic of car dealers, but I am now. They should at least be able to hang onto clunkers until they get payment for them, or are otherwise informed the vehicle doesn’t qualify. This way they can get their refund, or refurbish/ sell the clunker if the government falls through on their end of the deal/ decides one desn’t qualify and at least get some of their money back.

On another note, all the government did with this program is create a new class of people who should not have a new auto loan slapped onto their already growing debt (although they get no sympathy…. they signed the papers). It also eliminated a supply of reasonably priced vehicles for the “income-challenged” which they could afford to own/ which they should be owning vs. going after a loan.
http://www.rabidamerican.net/ Rabid American

When you sleep with dogs, you’ll probably get fleas…
http://www.biosolutionsarizona.com/ jgreer

How does filling our junk yards with tons of cars help the environment? Time and time again we have seen these incentive programs guzzle money and have nothing to show for it. The federal government spent 3 billion dollars so car dealers could have a good month. The sales are already starting to fizzle because everyone who qualifies has already made a deal. So now the dealers will go back to starving next month. What a great way to spend 3 billion dollars, Thanks Obama.
http://proof-proofpositive.blogspot.com/ proof_positive

How does filling our junk yards with tons of cars help the environment?

And depriving the poorer folk among us of millions of engine parts that might help them to repair the cars they have. (I knew I’d forgotten at least one!)
atease

If anyone believes that the anger in the town halls on health care are strictly for health care, they are stupid. People are pissed at the spending. Starting with Bush 43′s bailout and continuing with this administration totally lacking any economic smarts.

We are done with them all. Their desire to continue to spend their way out of the downturn is nothing more than reprehensible and lacks a simple history knowledge. We need a 100% turnover in congress. 100% and nothing less.

For years we have just thrown money at whatever problem was presented. What we need to do is get government out of business and let private enterprise do what they do best, make money. Let government regulate to a degree, but get the hell out of the way.

The cash for clunkers is only 3 billion dollars. Only my ass. Stop the spending and taking over private business.

atease
dawneyr

I’ll bet the O admin has been “efficient” at exploiting web site visitors to the program. http://www.youtube.com/watch?v=mqfuZ7hiap0
Buzz

And depriving the poorer folk among us of millions of engine parts that might help them to repair the cars they have.

You going to the junk yard to buy a piston out of a engine with 250,000 miles on it there Poofy? I guess I could see you doing that.

The only thing they have to shred is the drive train. Which is junk anyway. And the junk yards are full of this kind of shit already.

Another lame point of yours debunked, by Buzz.
Mark

Could’ve told them. This is like a one payer system.

Wait for health care “reform”.
robert108

Another lame point of yours debunked, by Buzz.

These cars are running, little buzzy! Obama’s payoff scheme is turning good cars into junk.
You’re a legend in your own mind.
badlands4

The only thing they have to shred is the drive train. Which is junk anyway. And the junk yards are full of this kind of shit already.

Another lame point of yours debunked, by Buzz.

Buzz,

I saw two news pieces(one was a local piece) about used car delers and used parts businesses suffering, so it is a real issue.
robert108

The real lesson here: Govt subsidies cannot create real, sustainable economic growth, which is what we need after six months of Obamunism.
ellinas

The real lesson here: Big lying parrot180, cannot provide a link to the seven advertisers that signed up on the G. Beck TV show.
Why are you lying? What is wrong with you?
robert108

Little e: Still stuck on off-topic trolling?
ellinas

Little e: Still stuck on off-topic trolling?
robert108 on August 16, 2009 at 09:03 am

No. I am trying to get a truthful answer from you.
Buzz

Turning two unserviceable vehicles into one serviceable vehicle is a concept apparently beyond little Buzzy’s grasp.

Well, I guess if I was a broke-dick scab that had to drive shit out of the junk yard I might be upset also. That’s a shame, maybe if you go back to school…
Buzz

They are scraping a total of 750,000 vehicles. There are 250,000,000 used vehicles in the US.

5 Million vehicles are totaled each year in the US in accidents which go into the salvage market.

So again, what is the problem?
http://www.cars4charities.org/ Cars4Charities

Now we can add them to the ever expanding list of industries hurt by this stupid program like used car dealers, car repair shops, auto parts stores, car donation charties, etc.
sayanything-6955

Much like all government dependency and welfare programs, this one actually does more harm to those it was targeted at than help.

Yea, but now GM and Crysler can close some more dealerships because the dealers can’t pay for the cars they bought to sell under this gov scheme, and every one can lose!
sayanything-6955

The only thing they have to shred is the drive train. Which is junk anyway. And the junk yards are full of this kind of shit already.

How little you know of the business buzzy, I have a 97 olds cutless supreme with an engine out of a 2000, a 3.1 liter as a matter of fact. My car has 110,000 on it, the engine has 40,000. There is a huge market for used and salvageable car parts in this country. And the cars and parts that don’t get crushed and scrapped here damn sure do end up in other countries! mainly Mexico and South America, all for a price. BTW that engine I bought and had installed in my clunker, paid 500.00 for the engine, 500.00 for labor. Bargain at twice the price!!
sayanything-6955

Turning two unserviceable vehicles into one serviceable vehicle is a concept apparently beyond little Buzzy’s grasp.

As I don’t do car payments, The wifes car is newer one, paid cash! Mine, which doesn’t get driven nearly as much, would make more sense to repair than replace. Although I have looked at the clunker cash schemes, I have found prices on most GM vehicles roughly 3,000-4,000 more now than last spring, Which kinda makes the whole thing a waste.
http://www.junkcarsforcash.org junk cars for cash

I’ll back again for sure, thanks for great article

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Auto Dealers Learning That Cash For Clunkers Isn’t Such A Great Deal After All

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