The Transportation Department has stalled the Car Allowance Rebate System (CARS) program, also known as cash for clunkers, as early as Friday due to a paperwork backlog, according to Reuters.
Although the money meter at cars.gov shows the fund tank is still more than ¾ full, with an estimated $779 million left for cars and light-trucks, it may not reflect all committed CARS vouchers. The suspension would allow for National Highway Traffic Safety Administration (NHTSA) to process existing CARS claims and more accurately report on remaining funds, according to USA Today.
The cash for clunkers program has been very effective in driving showroom traffic. There was always the question of how long the allocated $1 billion would last, and if it could stretch until November 1st. Current concerns within the government and auto industry suggest the money may not last nearly that long.
U.S. Senator Debbie Stabenow (D-MI) in a released statement indicated that more than 200,000 vehicles have been sold. Based on preliminary data, we estimate an average rebate value of $4,215 – with 28.5 percent of them valued at $3,500 and 71.5 percent valued at $4,500. This means more the two thirds of the junked vehicles are being replaced by significantly more fuel-efficient models, furthering the goal of greening the national fleet. It also means, the funds may be tapped out.
Legislators are discussing ways to extend the program, according to the Detroit News.
When or if the program will be reactivated or receive additional funding remain open questions. One thing is for sure, if opportunity knocks again, don’t delay.
For more information on trading in your clunker for a more fuel-efficient car see our cash for clunkers guide. Also, check out our forum to share your buying experience and give advice to others looking to make the trade.
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