Cash for Clunkers Suspended? Has the Money Already Run Out?
The federal government's popular (albeit controversial) "Cash for Clunkers" program may be on the verge of collapse amid rumors that the money has run out already.
The program has only been up and running for a week. It was initially conceived as a way to help the auto industry get through its current economic struggles. The program was met with much hoopla (and a fair amount of criticism), but it seems like it may not come close to living up to the hype.
Late last night, the White House announced that the program is being placed under review. This announcement came as rumors were flying around that the program was being suspended.
The program was intended to continue until November of this year. However, there was also the caveat that it would end prematurely, if the money in the program had run out. That may be exactly what has occurred, although it certainly wasn't expected to happen this fast.
It seems that auto dealers have been far more active working out deals that the government expected. If each participating auto dealer worked out a dozen cash for clunkers deals, that would equate to $1 billion in government money (which would trigger the end of the program). Some dealers, though, have already set in motion over 200 deals. This far exceeds government expectations.
Now it's a race to get the little money that remains. Dealers are trying their best to push their deals through before the program is shut down permanently.