Lindeman Sees Mild Cash for Clunkers Business

Lindeman Buick on North Avenue handled three formal Cash for Clunkers sales before the government stimulus program ended on Monday.

The dealership's owner, Tom Lindeman, reported having more interest in the program, but most customers did not meet the criteria set by the U.S. Department of Transportation to qualify for the incentive program. He said many of the people who had come to the dealership to discuss the program owned existing Buicks which were too fuel-efficient for the program.

The federal government's goals for the program were to stimulate car-buying—to help the auto industry—but also to encourage owners to get rid of older vehicles that were not fuel efficient. If the vehicles met the DOT requirements, owners were eligible for credits of either $3,500 or $4,500. The program proved so popular that Congress added an emergency cash infusion earlier this month.

Lindeman said the biggest issue now is waiting for reimbursement from the federal government. Each dealership had to submit paperwork to participate in the program and then wait to be paid. On several occasions, Lindeman has had paperwork sent back by transportation officials as not meeting federal standards. This has delayed payment for the cars Lindeman has sold through the program.

"The paperwork was complicated," he said.

Lindeman has disposed of the three vehicles he received through the program, which included two luxury conversion vans popular in the late 1980s. After destroying the engine with a chemical solution, the dealership was able to turn the vehicles over to a local salvage yard selected by the government.

While the "Cash for Clunker" program brought mild business to his dealership, Lindeman said his overall sales continue to remain down. He compared the pace to the one seen last fall when General Motors was on the verge of bankruptcy and the American auto industry was in a period of steep decline, forcing CEOs to beg the federal government for assistance.

He sees his business as being about 30 to 40 percent down, with used cars doing better than new because of the lower prices. He said from his research, foreign car sales are doing about even with domestic sales, even though the perception is that the domestic auto industry has been suffering for the past year.

"It's about the economy," Lindeman said of the auto industry's current sales woes.