Straight Talk on Cash for Clunkers

Tuesday, 23 June 2009 10:57

The auto industry in the United States won a decisive battle last week when Congress passed The Consumer Assistance to Recycle and Save (CARS) Act - better known as Cash for Clunkers.

The program, which AIADA lobbied heavily for, will stimulate car sales by offering consumers up to $4,500 for trading in their old clunker for a new, more fuel efficient vehicle. We dealers, for the first time in a long time, have a real reason to celebrate.

But let's not let the celebration go to our heads. Dealers must be aware of the challenges associated with this program, and take the following actions:

1. Pay close attention. A number of factors related to the CARS Act still need to be hammered out - including how dealers will be registered in the program, how dealers will be reimbursed for vouchers, and how cars will be certified as ‘scrapped.' The Department of Transportation has 30 days from when the president signs the bill to finalize these issues. Until the regulations are completely finalized, dealers are strongly advised to refrain from selling cars under the program. AIADA will be the first to let you know when dealers can start offering vouchers.
2. Be prepared. In the coming months dealers must be ready to handle a huge surge of prospective buyers to their showrooms. Americans will be looking to cash in on the government incentive, and will expect you to be ready to help.
3. Follow up on the information you receive from your manufacturers. Your national sales office will inform you of their specific marketing and advertising plans, all geared to maximizing the potential of this historic program.

AIADA keep our members updated as the CARS Act takes shape. In addition to direct letters and faxes, keep any eye out for information in our FirstUp newsletter, AutoDealer magazine, Weekly Capitol Insight e-mail, our website www.AIADA.org, and my "Russ off the Cuff" dealer-to-dealer letter.

To learn more about the CARS Act, visit the program's ONLY official, government-run website at www.CARS.gov. You can also direct your customers to this site, which will be updated regularly. Information from any other website should not be trusted; already ‘imposter' sites are looking to take advantage of dealers' excitement.

Cash for Clunkers has enormous potential to revitalize the struggling auto retail sector. The next few months will be a turning point for car sales in the U.S. Dealers can rest easy knowing that the Department of Transportation, AIADA, other dealer associations, and manufacturers are all working together to create the most impactful, efficient program possible.

In the meantime, feel free to break out the bubbly. Just keep those vouchers under wraps.

Russ Darrow, AIADA Chairman