DETROIT -- On the cash-for-clunker programs last weekend, dealerships saw a flurry of last-minute shoppers -- and in some cases, turned them away.
Consumer auto Web site Edmunds.com today estimated that the nationwide annual sales rate for the weekend was about 15 million units, compared with an 11.1-million-unit rate for the month of July. Consumers had until 8 p.m. EDT today to make their clunker sales and get discounts of as much as $4,500. Dealers have until sometime after noon Tuesday to submit them for U.S. rebates, after two extensions announced Monday.
For Robert Eret, the programs end means he can finally sleep late.
Ever since the cash-for-clunkers program started, Eret, finance manager at Joe Panian Chevrolet in suburban Detroit, has been reporting to work at 5 a.m. in order to stay ahead of the tidal wave of paperwork that must be filed for each clunker deal.
At 1 p.m. Saturday, the store wrote its last clunker deal. In the following hour, the store answered 10 phone calls from customers interested in trading in their old clunkers.
Its frustrating as a dealer, Eret said of turning customers away. We understand their rush. But where have they have been? This has been going on for more than a month. Now you have people in a panic.
The store took in 60 clunkers and had been reimbursed for just seven by Saturday afternoon. Eret says he has been filing 13 to 18 documents per clunker trade as well as filling out online forms.
If everything goes well, he said, that process can take as little as 40 minutes. But it has rarely gone smoothly, and the store doesnt want to be left being owed thousands of dollars because of paperwork troubles. We want to do last-minute deals, Eret said, but we have to make sure we can get reimbursed.
At Fresard Pontiac-Buick-GMC, the suburban Detroit store was still writing clunker deals Saturday. Showroom traffic was brisk in the early afternoon. General Manager Mike Dersa said that during the program, showroom traffic increased 80 percent and sales jumped 60 percent.
He said the store will continue doing clunker deals until Monday. There have been some glitches with the government getting us reimbursed, but its been a phenomenal program, said Dersa.
Said J.D. Power And Associates analyst Jeff Schuster: Those that were thinking about it or were on the fence are going to move off the fence, which could mean that were going have consumers driving away in a lot of purple cars because there are not that many cars left on dealers lots. There isnt any inventory out there. Its incredible.
Busy, but not crazy
Nearly all the sales staff at Dean Sellers Ford in suburban Detroit were working with customers in the showroom Saturday just as the store was winding down its clunker trades. Its been busy, but I cant say it has been crazy, said Dean Sellers, the general sales manager. Its not like everyone waited until the last minute. They knew it was coming to an end.
Sellers said hed only do another clunker trade if a customer came in with all the required paperwork that would ensure the deal wouldnt be rejected by the government. Our goal, if we put a clunker deal together now, is to have the paperwork in by noon on Monday, he said.
But, he said, many consumers wanting to trade in a clunker didnt have all the required proof of registration and insurance at hand. The dealership has sometimes waited days to get all the documentation so that it can file a clunker claim. But theres no more time to clear up paperwork problems. Sellers said his store has done about 120 clunker deals and had been paid for only 14 so far.
At Tamaroff Honda in suburban Detroit, there were few customers in the showroom Saturday, though the phones were ringing. The store took in about 100 clunkers before cutting off the program Thursday. We got rid of many 09s and we are a bit low on inventory, said salesman Treniel Williams.
Asked to compare Saturdays showroom traffic with volume seven days earlier, he said: Last Saturday we were booming.
Most dealership officials expect a sharp drop in business next week, not only because of the end of the clunkers deals but also because their lots have been picked clean.
The Suburban Group of dealerships stopped writing clunker deals Friday, a salesperson said. Still, at Suburban Toyota outside Detroit, the showroom was busy with about half a dozen shoppers.
Many of the stores in the metro Detroit area that were open for business Saturday cut off clunker deals Thursday or Friday, mostly because finance managers feared they could lose money on deals where the reimbursement claim gets rejected for clerical errors or because of technical glitches.
AutoNation, Group 1 halt
Two of the nations biggest auto chains -- AutoNation and Group 1 Automotive Inc. -- also pulled the plug early on cash-for-clunkers.
AutoNation said that it would halt all clunker deals at the close of business Friday at its stores.
A staff of 40 to 50 people at AutoNations main back-office operation in Dallas was to spend the weekend attempting to process about 1,000 contracts that had not been submitted yet, AutoNation spokesman Marc Cannon said.
Cannon said that AutoNation has been reimbursed on a small number of its 11,000 clunker sales. On Thursday, Cannon said AutoNation was owed $45 million for its clunker deals.
AutoNation is No. 1 on the Automotive News ranking of the top 125 dealership groups in the United States, based on 2008 new-vehicle retail sales. Group 1 is No. 4.
Group 1 halted clunker deals Thursday night at all of its East Coast stores, which represent 41 percent of the publicly traded chains business volume. Those stores alone have some 400 unsubmitted clunker contracts, Group 1 Vice President Pete DeLongchamps said Friday.
Other Group 1 stores halting, too
Group 1s Central and Western stores were to suspend all clunker deals at the close of business Saturday, and then spend Sunday and Monday processing paperwork, he said.
We are disappointed that they didnt extend the deadline as NADA requested, but we think we can get all of our contracts processed, DeLongchamps said.
The company says it has so far been reimbursed for only 37 of the approximately 4,000 clunker deals it has delivered across the country. DeLongchamps estimated that Group 1 was owed about $15 million in reimbursements.
Bill Wallace, owner of the Wallace Automotive Group in Stuart, Fla., said Friday that his import dealerships were jammed with last-minute customers wanting to take advantage of cash for clunkers.
He has sold about 300 vehicles under the program, has submitted applications for reimbursement for about 200 of those transactions and has been paid for one.
He was worried that he wouldnt be able to get all of the applications for the remaining 100 sales, and for sales he expected to do this weekend, submitted by the deadline.
Give us more time
Im not sure we can get the 100 done by Monday. Theyve got to give us more time, says Wallace, who owns 13 Florida dealerships. The Web site is jammed. Its crazy.
The only good news we have only 50 to 70 vehicles at all our locations that qualify under the program.
Damon Schoen, operations manager, Hamilton Nissan Hagerstown, in Hagerstown, Md., said he has been keeping up with the paperwork and incentive reimbursement applications.
We hired extra people and weve been coming in on Sundays making sure that we stay current with these claims, Schoen said. I would not let them get behind -- no, no, no. Theres too much as stake.
His dealership put a halt to cash-for-clunker sales at 3:30 p.m. Friday.
Each transaction the store made on Friday went through four employees to make sure that the all the paperwork was in order, Schoen said. The dealership refused one sale because there was a nine-day lapse in the licensing of the trade-in clunker.
It looks like they let their (license) tags run out for nine days last December. The rule says you have to have continuous registration for a year and Im not messing with that, said Schoen.
Said Eret, the Joe Panian Chevrolet finance manager: Its going to be a real interesting end to the month.
Neil Roland, Arlena Sawyers and Chrissie Thompson contributed to this report.