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Greater Des Moines dealers mixed on ‘Cash for Clunkers’ benefits


By Chris Contezkey

The Cash Allowance Rebate System – better known as “Cash for Clunkers” – is having drastically differing effects for two of Des Moines’ largest automobile dealers, on the heels of an MSNBC.com report that the program is boosting auto sales nationally.

Charles Gabus Ford General Manager Jim Bintner reported a large spike in traffic at the store and estimated a 30 percent to 40 percent increase in business since it began utilizing the program on July 1.

The $1 billion federal program, which expires Oct. 31, allows owners of 1984 or newer car models that get 18 miles per gallon or less to trade in their clunkers for vouchers between $3,500 and $4,500 off brand-new fuel-efficient cars.

The program, however, didn’t officially begin until July 24, and Charles Gabus Ford still hasn’t been approved for the program by the National Highway Traffic Safety Administration (NHTSA), which still is in the process of selecting qualified applications from the approximately 20,000 dealers that applied.

Brett Moyer, general sales manager of Karl Chevrolet Inc., said the “Cash for Clunkers” program is going terribly for his dealership, and that the lack of approval is the reason he has decided to suspend offering it.

“We put the cart a little bit in front of the horse and delivered some cars, thinking that we had all the stipulations to get the approval,” Moyer said. “Now the way it’s going, it’s taking so much time I’ve changed our approach to that, and we won’t be delivering any more cars until I get the approval on the money.”

The NHTSA said it has rejected 2,964 applications of the 20,564 applications submitted, according to MSNBC.com. Dealers must submit an application for each car brand it wishes to sell.

Bintner, however, doesn’t feel that getting approval will be a problem, and is going ahead full-steam. He feels that the program will be a big help for his dealership, and that the uptick in business should last a week to 10 days, or until either inventory or the money for the program runs out.

That situation further fuels Moyer’s concern.

“Part of the problem is not knowing how many they already approved,” he said. “I could have deals sitting here, and they have run out of money that I’ve already submitted for.”

U.S. Transportation Secretary Ray LaHood told MSNBC.com that it expects 250,000 new car sales in the next few months, aided from the program.

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