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August 26, 2009

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Deadline extension granted in Cash for Clunkers program

AMERICAN car dealers will have a bit more time to get reimbursed for their Cash for Clunkers deals after the government extended the deadline for filing applications for the US$3 billion government incentives into yesterday.

All sales under the program ended on Monday evening. But after already pushing back the deadline to submit records for the car rebate deals to noon yesterday, the Transportation Department said late on Monday that dealers may have more time to submit pending claims, due to continued problems with its Website.

Government computers set up to handle the filings were deluged by dealers trying to send in their sales agreements at the last minute. Before the extension, all the paperwork was supposed to be submitted by Monday night, but the big rush of submissions shut down the government's computer filing system temporarily.

Technical problems

That raised concern among dealers that they wouldn't be repaid for the US$3,500 or US$4,500 per vehicle incentives, and prompted them to push for an extension.

The government agreed to give dealers until noon yesterday to provide the proper documentation and ramped up staff to handle the influx. But late Monday, it told dealers that the site wouldn't be fully operational until yesterday morning.

"We continue to address technical problems with the CARS Website, and have determined that the Website will not be fully functional before (Tuesday) morning," the Transportation Department said in a statement. "Dealers should be assured that they will be provided time to submit pending deals equivalent to the time that was lost this afternoon while the system was down."

Geoff Pohanka, who heads about 15 dealerships in Maryland and Virginia, said he had submitted about 910 clunker deals to the government and had only received payment for 16. He estimated the government owed his dealership about US$4 million for the outstanding claims and was hopeful to get the final 90 voucher submissions into the system.

"Every 30 seconds, we're going back to the computer to see if we can get them in," he said.

Transportation officials said that, through early Monday, dealers had submitted 625,000 vouchers totaling US$2.58 billion.

Cash for Clunkers has been successful in spurring new-car sales and getting gas guzzlers off the road.


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