Sconda

Cash for Clunkers, a Sconda Post-Mortem

The madness that was the Car Allowance Rebate System, a.k.a. C.A.R.S., better known as Cash for Clunkers has officially, maybe, definitely ended and we have photos of the aftermath. 

The rules were confusing, the monetary risks were (are) all on the dealer, the complaining in the the sales mangers office was loud...and then we started selling Hondas, and then some more and then the government's money ran out, then the government gave more money, then we really started selling and selling and then at 4:13 p.m. on Saturday, August 22, the program ended with one announcement over our loud speaker by Used Car Manager, Matt Nergart.

    "If you are here to take advantage of the Cash for Clunkers Program...we are sorry, but due to the huge volume of deals we will not be accepting any more Cash for Clunker deals after 4:30 pm."  There were easily 100 people in the showroom, but you could hear a pin drop Nergart recalls.

At that point there was a stack of 30 deals still to be delivered and while our store hours state that we close at 5:00 p.m. on Saturdays, we knew this Saturday would be an exception.  It wasn't until a stroke before midnight that Finance Manager Kevin Shoemaker turned the lights, locked the front and waved goodbye to the last of 49 customers to drive in in a clunker and home in a Scott Honda.

All tolled Scott Honda did 192 Cash for Clunker deals, with an outlay of over $700,000 total.  We have been paid on 10 clunkers to date, which from what we are hearing is actually really good.

"The program had its quirks, but as long as every dealer gets paid on properly submitted deals, it will have been a huge success," says Vice President, Duke Scott.  "But if two months go by and dealers are still waiting for funds or have been refused funds, all the good will created by this program will be destroyed, just like those clunkers."

Saturday is Last Chance to get Cash for your Clunker

The writing is on the wall, or the door in this case.  Scott Honda made the official announcement on Twitter at 11:14 a.m. when we tweeted , "Scott Honda's last days of accepting Cash for Clunkers are today and Saturday! Do not wait until Monday! take advantage of this $ now!" with 6 characters to spare.

After the government announced last evening that the hugely popular Car Allowance Rebate System, as it's known by no one, or Cash for Clunkers, as it's known by everyone, will come to a halt on Monday evening at 8 p.m. many dealers had to scramble to decide how they would close out the program.  The Monday night deadline is for the digital submission of the deals, a time consuming process that has frustrated many dealers to say the least.

Scott Honda's upper management made the decision to close the books on the program at the end of business Saturday, based purely on the time needed to properly submit these deals in order to get reimbursed by the government.

"There is no doubt we have done more business because of Cash for Clunkers," said Vice President, Duke Scott.  "But I am not sad to see the program end and get back to the business of selling cars the old fashioned way."

Currently Scott Honda has been paid on six of the more than 130 "clunker" deals sold since the program launched in July.  With a conservative estimate of 30 more deals to be done by tomorrow, that's over $575,000 we have floated, in hopes of a government payback.  Scott made the decision to keep our clunkers instead of crushing them, until payment is received so that we can at least guarantee some money for our old, beat up cars if the payments never come.

It is currently, borderline pandemonium on the sales floor as customers stream through the door trying to take advantage of the program before it ends.  As one sales person told their customer, "Bring a book, a pillow and a blanket, because it's gonna be a while." 

Scott Honda's on CNN for Cash for Clunkers

Who knew it would work?

I submitted my Sconda post from yesterday about Cash for Clunkers in action at Scott on CNN's i-Report after a read a whole section on people trying to deal with the Clunker Bill.  So I signed up and submitted my mini-article and wouldn't you know it it actually made it in there.

I even got a sarcastic comment from "Jayberdz" who asked, "How much was Mr Freedman given for becoming part of your advertising campaign"

I replied, "Mr. Freedman was referred to Scott Honda by a good friend of mine and he was among the first customers to come to us about a month ago with a "clunker".  So I was with him from the beginning, when little was known about the exact details of the program, until the end when he said goodbye to his old Caprice. He seemed a logical person for a quick profile for our blog to let customers know that the process is not as overwhelming as it may appear. So in short all I did was ask him if I could take a picture and ask a couple questions to be out "Cash for Clunkers Poster Child" and he thought it was a neat idea.  Bribes are not needed when a good relationship has been formed.  The I-report was a shot in the dark that actually worked. But thank you for reading "Jayberdz" and if you are in the West Chester, PA area and are looking for a Honda, let me know."

Other comments that have been raised by readers question why it isn't only for "American" cars, i.e. GM, Ford, etc.?  My response will be, "The "foreign" car manufactures build millions of cars in the United States and directly and indirectly employee millions of Americans as well.  So excluding foreign cars, like Honda, VW and Subaru, hurts many Americans.  Our taxpayer dollars are allowing those who qualify to pick cars they want, not forcing them to buy something they really didn't want.  They are also taking gas guzzling, emission spewing vehicles out of commission and replacing them with much more environmentally friendly cars.  There are problems with the bill, but that isn't one of them."

Thanks for reading...that was fun!

Cash for Clunkers in Full Swing at Scott

Meet Jeffery Freedman, a hard working, high school teacher from Philadelphia and one of our first customers to take advantage of the Car Allowance Rebate System, better known as Cash for Clunkers.

Freedman admits he hates buying cars, which is a big reason why he held on to his 1989 Chevy Caprice Classic for nearly 12 years.  But when the government announced C.A.R.S. he knew he had to act fast.

"It got to the point where I needed a new car and the timing of the program happened to work out great for me," Freedman said holding his new Accord keys and glancing at his old Caprice. "It's a great use of the stimulus package and a great way to get old cars off the road and help the common man."

After careful deliberation he decided a 2009 Honda Accord LX was the perfect replacement for his 20 year old guzzler.  Using the governments fueleconomy.gov he and his sales consultant, Greg Cole determined the fuel improvement was nine miles per gallon, giving him a cool $3500 off a brand new Honda, plus an additional $50 scrap value. 

Freedman took delivery of his car last evening and is one of a dozen Scott Honda "Cash for Clunkers" deals, with what we hope are many more to come before the governments' $1 billion runs out, which may be sooner than we think.

For more information on the "Cash for Clunkers" program please visit Cars.gov.

Cash for Clunkers is Here...Now What?

Well the ads are on the radio, the blogosphere and chat rooms are a buzz, government websites have been established, but there isn't one confident car dealer or D.C. insider who can say for sure how this Car Allowance Rebate System (C.A.R.S.), better known as "Cash for Clunkers", actually works.

Here's what we do know:

• Only New Vehicles may be purchased
• New Vehicle must have an MSRP of $45,000 or less
• "Clunker" must be less than 25 years old
• Vouchers are Not Retroactive
• "Clunker" must have been registered and insured for 1 year to be eligible
• "Clunker" must be drivable (not totaled)
• "Clunker" must have a combined fuel economy of 18 miles per gallon or less
• Only one voucher per customer and one per vehicle (if co-owned)
• Excludes New Vehicle leases under 5 years
• All Hondas qualify (except S2000 and Accord V6 manual coupe)

The websites with the best information are Cars.gov and Fueleconomy.gov.  According to Cars.gov the vouchers will be worth between $3,500 or $4,500, depending on the type of vehicle you purchase and the difference in fuel economy between the purchased vehicle and the trade-in vehicle. Different requirements apply for work trucks.

The program is to begin, and I am quoting the National Highway and Traffic Safety Administration (NHTSA), "around July 23" and continue until November 1, 2009, although the general feeling among cars dealers is that the 1 billion dollars allocated for the program will be depleted by Labor Day.

In the end the risk is on the side of the dealers, because if the car, by some small detail doesn't qualify for the voucher, the dealer will not get the $3500 to $4500 they had worked into the new car deal.  Which means the small profit or small loss they would have had will turn into a $3000 to $4000 loss because that clunker is probably only worth $500 in the real world.

In the end most medium to large sized dealers will probably only gain 10-15 new cars sales before the money runs out, but in an economy like this every car counts.