Obama Administration Set to End Cash for Clunkers on Monday

Monday will mark the end of the wildly popular Cash for Clunkers program, offering shoppers one final weekend to trade in their car for a new one and to receive a rebate of $3,500 or $4,500 in the process. Transportation Secretary Ray LaHood noted that the program has ended up being "a lifeline to the automobile industry, jump starting a major sector of the economy and putting people back to work" and that his department is "working toward an orderly wind down of this very popular program." Thus far, according to government statistics, auto dealers have sold $1.9 billion worth of automobiles under the program, selling 457,000 vehicles in the process.

To avoid exceeding the $3 billion funding for the program, however, it is now necessary to shut it down. John McEleney, who is the chairman of the National Automobile Dealers Association, noted, "I think if we can get a clean cutoff Monday and get everything processed by then, it will have been a pretty darned successful program." McEleney was concerned, however, at the length of time dealers have had to wait to be reimbursed for incentives that they have offered under the program.

Mike Mahalak, owner of a Dodge, Chrysler and Jeep dealership in Florida, noted that he has some concerns about a potential rush to use the program before it ends on Monday. There has already been an instance of computer systems designed to handle claims crashing because of high demand, and Mahalak is worried that it will happen again. The dealer noted, "That web site will lock up again once everyone is cramming it again on Monday."