Auto Dealers Race to File Clunker Deals

Washington DC August 24, 2009; The AIADA newsletter reported that after a weekend sales surge, auto dealers are racing to file for Cash for Clunkers rebates before the program ends this evening.

According to the Wall Street Journal, many are moving early to halt sales of vehicles under the Car Allowance Rebate System to give themselves time to process paperwork.

AutoNation, which operates 264 dealerships in 15 states, halted its clunker sales on Friday. They worry that if a last-minute rush to enter applications jams the system, they will be on the hook for rebates already given to customers.

The weekend's jump in auto sales is likely to lift August sales to more than one million cars and trucks, according to J.D. Power & Associates.

That would represent a 2 percent increase from the year-ago period, the first time the industry has seen a year-on-year rise since June 2007. Many in the auto industry expect the rate of sales to slip in September, as a result of the ending of the clunkers program.

Lean inventories are also likely to squeeze sales in the weeks ahead.