NADA Says CARS Funding Depleted
"We asked them to put a halt to the program - I think we said 'very soon' -- but a suspension at midnight tonight (Wednesday) would make sense," John McEleney, NADA chairman was quoted as saying by Autonews. "Our survey opened the eyes of the Transportation Department."
The main concern is that the funds have run out an no one knows it yet. The idling of the program would allow dealers to submit pending claims, hence allowing for the correct evaluation of the money left, "if any" says NADA.
NADA has gone even further and warned dealers they may be making CARS transactions with a great risk of not getting paid.
"It is important to note that NHTSA has confirmed elsewhere that if the program's money runs out before a dealer is reimbursed, that dealer will not be paid," the NADA statement said. "Dealers who accept additional 'clunker' deals face a growing risk that they may not be reimbursed."
A similar chain of events happened in the last week of July, when NADA warned the initial $1 billion has run out. After the additional funding has been approved, initial estimates said the money would last until Labor Day (September 7).