Auto dealers in Colorado hail 'cash for clunkers' program

The federal government’s “cash for clunkers” program has spurred thousands of new car sales in Colorado, a state that has seen such sales decline more than 41 percent over the past year.

Despite stories of bureaucratic snafus and misinformation, most dealers in the state are hoping the U.S. Senate acts quickly to inject new money into what they believe has been a wildly successful stimulus program, said Tim Jackson, president of the Colorado Automobile Dealers Association.

The industry group has estimated participating new-car dealers among its 260 members sold between 4,900 and 5,400 cars from the program’s first day, July 24, through July 30, when the original $1 billion in stimulus money was thought to have been exhausted.

Jackson said those dealers would have typically sold about 1,800 vehicles during that same period.

“Our sales have just gone off the charts,” said Mike Cimino, who oversees three Ford dealerships owned by the Colorado Springs-based Phil Long auto group.

Cimino said sales at the Ford dealerships - two in Colorado Springs and one in Denver -  have been up 20 percent to 25 percent in the past 10 days.

He said the program - which offers rebates of $3,500 to $4,500 depending on the fuel mileage difference between the car being traded in and the new one being purchased, is attracting buyers the dealerships are not used to seeing, from retired couples who have kept their cars 15 or 20 years to people who normally buy used cars.

He said the program also spurred increased sales at other Phil Long dealerships selling different makes of vehicles.

Still, the program hasn’t been without its problems, said Cimino and Jackson.

Both report lots of red tape; a clogged government Web site that dealers must access to get approval for the deals; and continuing uncertainty over how much, if any, of the original $1 billion in stimulus money is left, and whether more will be coming.

The U.S. House voted Friday to inject $2 billion more into the program, but the Senate has yet to vote on a new injection of cash.

Jackson said the state dealership association issued an advisory Monday morning warning dealers to either not participate in the program or take deposits but don’t close deals until either:

• the Senate approves new funding
• the Obama administration makes new assurances that deals will be honored
• or the federal transportation department tells dealers the original funding has not been exhausted.