It looks like it’s happened again--Cash for clunkers may have run out of money.

The National Automotive Dealers Association (NADA) has asked the U.S. government to suspend the Cash for clunkers program following a dealer survey it conducted earlier this week that found the $3 billion fund has been depleted.

Just yesterday, the Department of Transportation and NADA officials met to discuss the program and the process for ending it. Transportation Secretary Raymond LaHood announced that a phase out plan would come tomorrow. Now it looks like that may be too late.

NADA issued a statement on its Web site last night, saying: “NHTSA has confirmed elsewhere that if the program's money runs out before a dealer is reimbursed, that dealer will not be paid. Dealers who accept additional 'clunker' deals face a growing risk that they may not be reimbursed."

Quite a few dealers have already dropped out of the program due to the bottleneck in government reimbursements. NADA is asking the government to speed up the process to help dealers who are already facing financial hardship due to poor sales earlier this year. General Motors has announced that they will provide cash advances to dealers who are owned money in order to keep sales rolling and the dealers participating, but it isn’t clear how GM’s reimbursements might be affected if government funding runs dry. The initial $1 billion allocated was exhausted within a week of the program’s July 27th start date. An additional $2 billion was added just two weeks ago. According to NHTSA, 435,102 claims had been filed as of Wednesday morning amounting to $1,813 billion. But the last time the program ran out of money, NADA knew well before NHTSA based on its dealer survey.

The Clunkers program has been wildly successful even through these administrative bumps. A number of manufacturers have announced increases in production to meet the demand. Just this week, GM announced they were adding 60,000 vehicles in the production forecast through the end of the year. Last week, Ford announced they will build more of their Focus and Escape vehicles, two of the most popular in the clunkers program. Toyota, Honda, Mazda, and Volkswagen have also beefed up production.

However, there is some concern that this measure may be too late if the Clunkers program is already out of funds and dealers and manufacturers may again be stuck with an over supply of vehicles in their lots.

—Liza Barth

For further information on the CARS program, visit our cash for clunkers resource center, where you’ll find FAQs, recommended cars lists, and the latest news. If you recently purchased a new car under the cash for clunkers program, share your story in our forum or comments below.