The popular “cash for clunkers” program, in which the federal government put up $3 billion to reward car-owners who traded in older vehicles for newer, more fuel-efficient models, will end Monday evening, according to the Obama administration.
The program, which offered rebates of $3,500 or $4,500 to car buyers, proved wildly popular.
The initial $1 billion in funding was snapped up by consumers about a week after the program officially began; Congress moved quickly to approve an additional $2 billion before leaving for its August recess.
Critics have complained of administrative confusion and haste in committing the money, and some dealers have expressed concern that they were not being reimbursed quickly enough.
But the White House argued that the speed with which the money has been committed is a measure of the program’s popularity.
“This is actually a high-class problem to have — that we’re selling too many cars too quickly and there’s some backlog in the application process,” President Barack Obama said Thursday during an interview on a nationally syndicated radio show.
The program, formally known as the Car Allowance Rebate System, or CARS, has taken polluting cars off the road and stimulated the economy, administration officials say.
“This program has been a lifeline to the automobile industry, jump-starting a major sector of the economy and putting people back to work,” Transportation Secretary Ray LaHood said. “At the same time, we’ve been able to take old, polluting cars off the road and help consumers purchase fuel-efficient vehicles.”
The Commerce Department this month reported that manufacturing output was up in July — for the first time in months — and attributed the uptick to the vehicles being sold under the trade-in program.
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A look at ‘cash for clunkers’
*The Department of Transportation plans to end the “cash for clunkers” program at 8 p.m. Monday EDT.
*Through early Thursday, more than 450,000 transactions have been submitted by dealers, representing a total of $1.9 billion.
*The Transportation Department has reviewed and processed more than 150,000 applications and approved $140 million in payments to dealers.
*Obama administration officials said based on estimates of deals transacted under the program, the program will be able to accept new submissions until Monday’s deadline.
*After the program closes, the department will not allow dealers to submit additional applications.
*Dealers are advised by the government not to agree to any more sales under the program unless the dealer has received all the necessary paperwork from the consumer.
*By Friday, the department will have at least 1,100 employees reviewing transactions.
SOURCES: Associated Press, Transportation Department
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cparsons@tribune.com
