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New York dealerships dropping Cash for Clunkers

Seven On Your Side
August 19, 2009 4:58:16 PM PDT
Half of Greater New York auto dealers are dropping the programThe program got the customers in the door, but car dealers say the Cash for Clunkers program has been so poorly executed, that they are out hundreds of thousands of dollars and as many as half are going to drop out of the program.

"It was well-intended, but the actual actions of it, have been dismal." That's what Dennis Lauzon thinks. He should know he owns two dealerships, Parkway Toyota and Newburgh Toyota. He says at his dealership the Cash for Clunkers program has been a boon and a boondoggle.

The problem? The dealership owner says he has put in about 100 applications to the CARS program, but hasn't received a dime. He says his dealerships are out close to $250,000 in clunkers rebates. They've moved a lot of cars, but are still waiting for their government check.

"The public has been paid," says the frustrated business owner. "But we're still waiting for the money."

According to the Greater New York Automobile Dealers Association, only about 2% of the rebates that have been applied for, have been paid to the dealerships. And the dealers have extended themselves so much, that as many as half the dealers in our area have decided to stop participating in the program.

"What we're hearing is they (the dealers) just can't afford to do it anymore," says Mark Schienberg of the Greater New York Automobile Dealers Association.

Part of the problem is what dealers call the voluminous paperwork they must fill out. And the high number of applications that get kicked back for errors, close to 85% by the auto dealers' count.

"You got a great program where people want to take advantage," says Mark. "There's something wrong here."

The U.S. Department of Transportation told us they have been ramping up staff to meet the demand and working hard as they can to get these deals approved. When we asked them why Parkway Toyota hadn't been paid, the D.O.T. said it doesn't comment on specific dealership's situations.

Information on the Cash for Clunkers program

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Story by: Tappy Phillips


Produced by: Steve Livingstone

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