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NE BUSINESS > CASH FOR CLUNKERS PROGRAM NETTING A LOT OF LEMONS

junk car

CASH FOR CLUNKERS PROGRAM NETTING A LOT OF LEMONS

August 7 2009

Washington, D.C. – One of the hardest hit areas of the economy on the now slightly-improving economy has of course been the automobile industry. With all three of the major American car makers in serious economic trouble dealers across the junk cars
country shutting their doors times have been very dire for the automobile sector. The new Car Allowance Rebate System (better known as Cash for Clunkers) is being touted as shot in the arm for that dwindling segment of the economy and with funds for the program already starting to dwindle itappears to be having the desired effect.

Of course not everyone is pleased with the program. Though car owners have benefited from being able to trade their old and previously worthless cars in towards other vehicles, many dealerships are having a hard time dealing with the influx of ‘lemons’. With useless cars in every corner of the country now clogging dealer lots junk car
many are finding themselves at odds with the government program that is inundating them with largely unsellable merchandise, the last thing many of the struggling dealers need at this stage. Understandably some dealers aren’t too happy with the prospect of having to unload so many ‘lemons’.

“I mean most of these cars I wouldn’t have even let on the lot in normal times but of course these aren’t normal times. What the government should be doing is pushing people to bring in their good cars and we’ll happily buy them back. These things though, these things are just piles of garbage that no one wants. I’m just going to end up sending these things to a scrapper,” said junk car
Doug Jones of Doug Jones Chrysler. “I’ve been dealing cars for twenty years and I never thought I would have to be buying back this kind of garbage. Of course the economy is the in the garbage so maybe it’s only fitting that I have to take this kind of stuff into my lot.”

Dealers of course do not suffer a penalty from the government. Cars are sold for scrap at the exact value they give out to customers and any costs incurred are reimbursed by the government. Nonetheless many are outraged at the prospect of having to take in such low quality merchandise.

“What I’m really afraid of is that people will start to expect this kind of service. One junk car
guy trades in his piece of junk and then a friend comes in with their piece of garbage and they expect the same treatment. I didn’t get into the used car business to be dealing with old clunky cars and having to do these is really just an insult,” continued Jones. “I mean we all expected that some people were going to come in with lesser cars but I was thinking maybe like a 2002 Civic with a broken A/C. They are just bringing garbage that frankly we don’t even want.”

The Government has stated all along that customers would be bringing their unusable cars into dealerships and be swapping them for credit towards new vehicles, something many dealers have been slightly unaware of.

“One would have thought that the name alone would have made the push of the junk car
program very clear but apparently that is not the case for many dealers. It’s not like they are being forced to participate though it is to their advantage because it is allowing them to move other vehicles that have just been rusting on their lots anyway,” said Scrape TV Business analyst Ken Green. “I’m sure more than a few thought they might make out with a gem or two but it has been the same across the country. Dealer after dealer is being inundated with lemons. Maybe next time around they can change the name and bring in a slightly higher class of car.”

The one high point for many dealers is newer vehicles, primarily from Ford and GM, have been making it to dealer lots with many 2009 and 2010 vehicles already qualifying for the program.

William Ashford, Business Correspondent

BUSINESS > CASH FOR CLUNKERS PROGRAM NETTING A LOT OF LEMONS


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