Final weekend of clunkers program draws big crowds
EMILY FREDRIX / AP Business Writer
From Vermont to California, exhausted but appreciative car dealers watched their lots grow empty as crowds rushed to trade in gas guzzlers during the final weekend of the popular Cash for Clunkers program.
The hectic pace of the $3 billion rebate program accelerated in the final weekend, after the government announced the program would end at 8 p.m. EDT Monday, two weeks earlier than expected.
Adding to the urgency, some dealers had said they would stop Cash for Clunkers sales even earlier to make sure the government reimbursed them for the rebates — or because they didn’t have enough eligible cars left.
In the final hours, customers streamed in.
“We thought about it a couple weeks ago,” said Annette Palmer, 51, at Town and Country Honda in Berlin, Vt., on Saturday with her husband. They hoped to trade in a 1999 Jeep Grand Cherokee for a Honda CR-V.
“We kind of dragged our feet. Then we heard it was closing and we picked up our feet and ran,” she said.
Though short of some new models, such as the Ford Focus, Honda Civic, Toyota Corolla and Nissan Altima, many dealers were still selling as many cars as they could before Monday night’s deadline.
Standing outside one of his Hyundai dealerships in Appleton, Wis., John Bergstrom said customers traded in 100 clunkers throughout his fleet of 20 dealerships on Saturday and 100 the day before. They were his two biggest sales days during the clunkers program.
“That’s about as good as it gets,” Bergstrom said. “It’s going out with a bang.”
In all, Bergstrom said his dealerships — whose brands include Ford, GM and Toyota — sold 800 cars during the program, boosting sales 30 percent. He had to bring in extra staff to deal with the paperwork, but the sales were worth the hassle, Bergstrom said.
At Universal City Nissan in Los Angeles, Alberto Vasquez said keeping up with the pace of the program has taken a toll on employees. Some labored past midnight to wrap up last-minute deals.
“Are we tired? Definitely,” said Vasquez, the dealership’s director of training. “But it’s also bittersweet, because we’re happy that we’re selling cars.”
The dealership has sold more than 700 vehicles through the program and brought in extra staff to help enter information on the government’s reimbursement Web site.
Cash for Clunkers has been wildly successful in spurring new-car sales and getting gas-guzzling models off the road, though some energy experts have said the pollution reduction is too small to be cost-effective. Customers receive rebates of between $3,500 and $4,500, depending on the improvement in fuel efficiency from their old vehicle to their new one. As of early Friday, nearly half a million cars had been sold through the program.
But the new sales left many dealers worried about not being reimbursed by the government. As of Friday, dealers had been reimbursed for just a small fraction of the billions in sales.
Some dealers chose to stop participating over the weekend so they could have enough time to process and file the paperwork, including AutoNation Inc., the nation’s largest auto dealership chain.
At Toyota Direct in Columbus, Ohio, employees were told to double- and triple-check paperwork so it wouldn’t be rejected for reimbursement, said Jim Collins, the dealership’s assistant general manager.
Sales picked up on Saturday, though the dealership had only 20 new cars eligible for sale under the program. Sales employees sometimes jogged paperwork into the manager’s office to keep up with the pace.
The dealership won’t take any new sales on Monday so it can be assured of reimbursements, Collins said.
“We have quite a bit of paperwork, but is it worth the selling of a car right now? Absolutely,” he said. “We like to sell cars. That’s what we’re in business to do.”
Martin Main Line Honda in the Philadelphia suburb of Ardmore stopped its Cash for Clunkers sales at noon on Saturday. But by late afternoon there were still groups of people wandering the lot.
General sales manager Michael Freeman said the program had been “overwhelming,” with 115 clunker sales and big surges in customer traffic at the start and now at the end. He’s aiming to get the final stack of paperwork filed before Monday’s deadline.
“I have people upstairs, that’s all they’re doing — paperwork,” he said. “The backlog is a nightmare, and it’s starting to be a nightmare at the end.”
Customers were feeling the urgency, too.
In Appleton, Wis., April DeKeyser looked at her new Mazda 3 2010 and still had trouble accepting that it was hers.
The 22-year-old nurse from Brussels, Wis., had wanted to trade in her Chevy S10 truck as soon as the clunkers program began. But she had a hard time finding the car she wanted and had to run to numerous dealers.
DeKeyser said she knew she had to get the rebate this weekend. Without it, she wouldn’t have bought her new car.
“I would have waited,” she said. “Basically, I would have driven the other vehicle until it died.”
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Associated Press writers Alex Veiga in Los Angeles, Andrew Welsh-Huggins in Columbus, Ohio, Ron Todt in Philadelphia and David Gram in Berlin, Vt., contributed to this report.
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A net loss … if GM survives: Comments on Lutz’s retirement
Chrissie Thompson
Automotive News
February 9, 2009 – 2:02 pm ET
UPDATED: 2/9/2009 4:55 p.m. ET
Dealers and analysts sound off on Bob Lutz’s decision to leave General Motors after almost eight years as its product development chief. GM announced today that Lutz, 76, will become an adviser on April 1 and retire by year end.
 |
Ramsay Gillman, GM dealer and president, Gillman Cos. dealership group, Houston:
“He’s always been a product guy, which is something dealers have always needed and wanted and need today more than ever before. I’m more concentrating on the very, very near-term future right now. If General Motors doesn’t make it, we’re not going to see any of that new product.” |
John Casesa, automotive adviser, Casesa Shapiro Group LLC, New York :
“I was afraid this day would come because he’s the last of a breed in Detroit: a product-driven executive who understands the customer. The non-U.S. automakers are still very much steeped in the product and the customer, but that has not been the practice in Detroit for decades. You worry that GM will lose the product momentum that it had just begun to build.” |
| Jim Hall, analyst, 2953 Analytics, suburban Detroit:“He’s turning 77. That’s a long time to be traveling the way he is and run the schedule that he runs, and at some point in time, you just need to slow down. The problem is, GM doesn’t need a slow Bob Lutz. He put conscience back into product development at General Motors, and the question is: Will it stay there? Only time is going to tell.” |
Joe Serra, GM dealer and president, Serra Automotive Inc., Grand Blanc, Mich.:
“What was of importance to him, his team now understands. I’m very confident that he was there long enough that his DNA will remain. He’s worked more years than most of us are ever going to work. |
Efraim Levy, equity analyst, Standard and Poor’s:
“I would consider it a net loss to the company. His know-how and his gut feel were all assets to the company. It will take time for someone to replace his stature in terms of ability to cut through the red tape.” |
John McEleney, Iowa GM dealer and chairman, National Automobile Dealers Association:
“I’m not surprised, given Bob’s age, but I think he’s done a lot for GM. I think just about every product he’s touched has been a winner and an improvement over what came before — the (Cadillac) CTS, the (Chevrolet) Malibu and the crossovers.” |
Mike Jackson, CEO, AutoNation Inc.:
“Bob’s leadership unleashed the design talent at General Motors from the shackles of a moribund development process. The results are clear today and will be even more so in the future: world-class products with distinctive design and outstanding fit and finish. Interiors are his greatest triumph. Third world to world class in record time.” |
Fin O’Neill, president, J.D. Power and Associates:
“He’s really the poster boy for car guys, and there’s nobody that has that complete set of characteristics, so he’s really going to be missed. I think he showed the way. Whether the folks will follow all depends.” |
George Peterson, president, AutoPacific:
“You have to pay attention to the right things as you’re developing these products. He’s gotten them focused, and now there’s a more routinized process that they use in developing their products. This is something that they’ve needed for decades. No one has the persona of Lutz, so the process has to live based on what it is, not on who’s at the top. Hopefully the process is in place enough that it can run when Tom Stephens, not Lutz, is at the top.”
