The US version of the UK scrappage scheme seems to be finally kicking into gear as thousands of dealers have been sent federal letters telling them how to register electronically for the “cash-for-guzzlers” (aka “cash for clunkers”) program, rules for which will be issued July 24, a U.S. Transportation Department spokesman said.
The government said definitively for the first time that not only will regulations be available next Friday (24th July), but dealers can also file claims at that time for federal reimbursement of payments made to consumers under the program.
“We have full confidence that we’ll be able to put this together by then,” announced transportation spokesman Rae Tyson.
The agency is adding server capacity next Friday so that expected heavy traffic volume doesn’t crash its Websites, Tyson said.
Only dealers who register can participate in the new program, aimed at spurring US car sales by offering credits of up to $4,500 to customers who swap their old vehicles for new, more fuel-efficient cars and light trucks.
The program calls for dealers to provide the credits to customers, and then to file with the government for reimbursement. Dealers will also have to dispose of the engines and drive trains of the old vehicles to keep them off the road in an effort to improve the fuel economy of the U.S. Tyson said the new federal rules are aimed in part at preventing fraud in dealer disposal of used vehicles.
In preparing the letters, the government asked car companies for the names and addresses of all current dealers, including those slated for termination by General Motors, Tyson said. There were more than 19,000 dealerships as of the end of June, according to National Automobile Dealers Association data.
US President Barack Obama signed the “cash-for-guzzlers” legislation last month, and dealers were allowed to begin selling cars under the program on July 1st. However, dealers couldn’t file for federal reimbursement until the rules were announced, nor could they be sure they were complying with the yet-to-be-released standards (and we though our bureaucracy was bad!)
Both the government and NADA urged dealers to wait until the rules were out, but a number of dealers have already sold cars under the program. It’s these dealers that the Transportation Department worries may overload its systems next Friday with reimbursement claims, Tyson said, adding the Transportation Department is urging dealers to space out their claims.
The program has already drawn extraordinary interest among both dealers and consumers. The cars.gov site has been heavily trafficked since it was launched less than a month ago, Tyson said. He said the agency’s hotline fielded about 2,300 telephone queries yesterday, more than 400 from dealers.
Source: Automotive News