Is Cash for Clunkers Out of Money?

Will Car Rebate Stimulus Program Be Suspended? Funding Status Info

Jul 31, 2009 Lena Gott

Is the U.S. out of money for government auto rebates? There's talk of Cash for Clunkers suspension; car stimulus program deadline is unknown. Clunkers deadline looms.

The Consumer Assistance to Recycle and Save Act of 2009 provided for $1B in funding for the Cash for Clunkers program. Of that $1B in funding, the United States government is allowed to use up to $50 million to cover administrative costs.

Due to the immense popularity of this car rebate stimulus program, the Cash for Clunkers program deadline may be looming. In this article, learn about Obama's recent announcement regarding this stimulus measure and where to find the program's official funding status.

Car Rebate Stimulus Funding Status on cars.gov

The National Highway Traffic Safety Administration (NHTSA) recently displayed a gas gauge-like meter on the cars.gov homepage that indicates how much of the original $1B in funding remains. According to the gauge, as of the evening of July 30, 2009, $779 million remains out of the $1 billion set aside for the program.

Dealers are undoubtedly watching this funding gauge and listening intently for new government pronouncements because the Act’s language says that dealerships will not be reimbursed for any $3,500 or $4,500 vouchers issued after Cash for Clunkers funds have been exhausted.

Is Cash for Clunkers Out of Money? Government Auto Rebate Funds Running Out

Since there is a lag between the time when dealers issue vouchers and the point at which they are reimbursed, the federal government will likely run into a situation where dealers have issued vouchers for which there is no more funding. Rumors have been circulating to this effect over the past day or so. So, what will happen when Cash for Clunkers runs out of money before dealers have been reimbursed?

Dealerships may get stuck covering the $3,500 and $4,500 voucher credits. If this happens, dealers will inevitably press Congress to authorize more funding to cover additional vouchers.

More Cash for Clunkers Money? Obama Indicates More Funding in the Works

In a mysterious post late at night on July 30, 2009 (10:52 p.m, to be exact), the New York Times website announced, “The U.S. government will not suspend its $1 billion auto sales incentive even though confirmed sales and pending transactions neared the program limit of 250,000 vehicles much sooner than expected…the White House was working with Congress to try to extend funding for the program.”

It is currently unclear where additional funding would come from, although a Wall Street Journal Online article entitled ‘Cash for Clunkers’ Runs Out of Gas suggests that additional money might be appropriated from existing government funding. The article specifically mentions the re-allocation of funds from the United States federal government’s Troubled Asset Relief Program (TARP).

Cash for Clunkers Program Deadline

The Consumer Assistance to Recycle and Save Act of 2009 states that the Cash for Clunkers program will end by November 1, 2009 or when funds run out. Many consumers who anticipated taking advantage of the program fear that the program will end within the week unless President Obama and Congress authorize more funding.

In the meantime, consumers may wish to check out the following articles on the Cash for Clunkers program:

Cash for Clunkers Stimulus – U.S. Car Rebates

2009 U.S New Car Stimulus – Government Vouchers

4500 Car Rebate, U.S. Vehicle Purchase Incentive

Resources:

Cash for Clunkers Could Be Done or on Hiatus retrieved from autoobserver.com on July 30, 2009.

‘Cash for Clunkers’ Runs Out of Gas retrieved from online.wsj.com on July 30, 2009.

Car Allowance Rebate System final rules retrieved from cars.gov on July 30, 2009.

Consumer Assistance to Recycle and Save Act of 2009

U.S. to Not Suspend “Clunker” Program: Official retrieved from nytimes.com on July 30, 2009.

The copyright of the article Is Cash for Clunkers Out of Money? in American Affairs is owned by Lena Gott. Permission to republish Is Cash for Clunkers Out of Money? in print or online must be granted by the author in writing.

CARS Program Deadline Looms – $4,500 Rebates Gone?	Is Clunkers Program Suspended? Gauge on cars.gov	Is Cash for Clunkers Out of Money Today?
Obama Car Rebate Stimulus- How Much Money Is Left?	U.S. Government Auto Rebate Funding Status Unknown