(Host) Vermont auto dealers say the federal "cash for clunkers" program has helped revitalize the new car market across the state.
But money for the program will run out by the end of this week. That’s why Congress is considering pumping another two billion dollars into the program.
VPR’s Bob Kinzel reports.
(Kinzel) This has been a tough summer for the Walker Motors dealership in Montpelier for two reasons.
First, the sale of new cars has plummeted because of the recession. And second, the dealership is located right next to the construction of a new roundabout. That construction has resulted in long traffic delays – a situation that has caused many drivers to completely avoid the construction zone.
Kevin Murphy is the sales manager of the dealership. He says the "cash for clunkers program," which offers customers as much as $4,500 if they upgrade to a more fuel efficient car, has been a bright spot.
(Murphy) "I think due to the economy, with the recession, it’s a really good move to have this cash for clunkers. It has brought in a number of people to the dealership. So we’ve seen a considerable amount of traffic about this cash for clunkers, so it does help the car business."
(Kinzel) But the program’s success could lead to problems. That’s because the highest rebates are given for the most fuel efficient cars. And Murphy says a lot of smaller dealers are running out of these vehicles.
(Murphy) "I don’t know if the timing is good for cash for clunkers because when the inventory is down due to production being ceased by Ford or whoever. The time to do this is when you have a lot of inventory on the lot. When you don’t have a lot of inventory, then naturally you’re not going to sell a lot of cars."
(Kinzel) There’s also a lot of red tape with the program. Murphy reached behind his desk and pulled out 138 pages of regulations. He also has to register every sale with the federal government, but the program’s phone lines and Web site are jammed.
(Murphy) "So far, the paperwork is frustrating on the amount of forms that you have to have. And here’s an example of how many pages there are. Getting on the hotline is very, very frustrating. I’ve been trying since 8 o’clock this morning to get on the hotline and every time I get on there they’re just saying, ‘We are experiencing a high volume of phone calls. Please call back later.’"
(Kinzel) The program is strongly supported by Senator Bernie Sanders. He says it’s critical to pump more money into it.
(Sanders) "What it is doing is helping middle-class folks, who are in difficult financial straits and want to buy a car. It’s helping create jobs all over the automobile industry, not only in manufacturing, but in dealerships in Vermont and throughout this country. And, perhaps most importantly, what it is doing is getting inefficient, polluting cars off of our roads and highways and getting more energy-efficient cars to replace them."
(Kinzel) The U.S. House has already voted to allocate an additional $2 billion for the program. The U.S. Senate is expected to vote on the legislation by the end of the week.
For VPR News, I’m Bob Kinzel in Montpelier.