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Friday, August 21, 2009

Cash for Clunkers Crash and Burns

The New York Times reports that car dealers in New York have pulled out of the government's cost-shifting program to aid automakers in Detroit under the banner of environmental awareness. But dealerships are simply unable to pay employees or normal maintenance costs with the majority of their reimbursement requests still unapproved.

One dealership owner explains, “The bottom line is the bad outweighs the good,” Mr. Wondergem said. “I had to make a decision to stop participating because of the stress and the risk. This program has really consumed my life. "

The waits are so widespread that GM is now offering to deposit a temporary infusion of cash in order to shore up dealership's accounts and keep them participating in a program that has allowed the auto maker to raise production.

Meanwhile charities are hurting as vehicle donations suddenly drop, used care dealers are complaining about low inventories, and repair shops worry about the difficulties they will face when looking for spare parts.


jasonbradyut said...

Good…, as they say, all good things come to an end. Actually, this could be considered a BAD thing b/c it’s CRAZY, we are giving people money to live more vicariously and lavishly than before all this economical bust took place? What are we doing? Spoiling every single last American? Let’s learn to live in moderation, then we wouldn’t have so much debt…Well, the fish sticks from the head..so the head is the While House…right?

Anonymous said...

Dealers think its bad now, wait till the program is over and there is no sales. Why do people have clunkers? Is it because they can't afford a new one. sounds like the bank are going to need another bail out.