As 'Cash for Clunkers' Winds Down, More Dealers Pull Out Early

Aug. 22, 2009 — -- Planning to stop by your local auto dealership for a "Cash for Clunkers" deal this weekend? You might want to call ahead first to make sure that dealer hasn't clocked out on "Clunkers."

As some auto dealerships prepare for what promises to be a frenzied last weekend for "Clunkers" -- also known as the Car Allowance Rebate System, or CARS -- others are closing the book early on the unexpectedly popular government program. The government will stop taking applications for the program on Monday at 8 p.m.

"We're being very cautious," said Edward Tonkin, the vice president of Ron Tonkin Dealerships in Portland, Ore., which expects to stop Clunkers participation among the company's 14 dealerships by today. Tonkin wants to be sure that the dealerships will have enough time to submit Clunkers applications before the government's deadline.

AutoNation, the country's largest dealership chain, stopped making clunker deals at its 239 dealerships Friday night. It, too, cited application concerns.

"We want to have ample time to get our paperwork done, which is due Monday at 8 p.m. And when you have as many deals we have, you want to make sure you are buttoned up," said AutoNation spokesman Marc Cannon.

The National Auto Dealers Association has called on the government to give auto dealers extra time to fill out Clunkers applications. NADA said that while the program should end on Monday, the dealers should be given until Aug. 31 to do their paperwork.

"This later deadline for submissions would help avoid computer slowdowns due to overwhelming demand, and ensure that the president's statement [Thursday] that every dealer 'will get their money' is achieved in a sensible, orderly manner," the association said in a statement issued Friday.

Other dealers say that a lack of inventory is forcing them to pull out.

"It's pandemonium," said Steve Gates, who owns Toyota South, a Toyota dealership in Richmond, Ky. He also expects to end his Clunkers deals today.

"I've likened it to a half-off sales at Macy's in New York," he said. "People are getting to the point where they're fighting over the remaining vehicles."

For other dealers, the problem is more about cash than cars.

Some 200 dealerships belonging to the Greater New York Automobile Dealers Association said on Thursday that they were withdrawing from the program because the government had taken too long to reimburse them for Clunker rebates.

"What we're hearing is they [the dealers] just can't afford to do it anymore," Mark Schienberg of the Greater New York Automobile Dealers Association told New York's WABC-TV.