The National Automobile Dealers Association (NADA) has asked the U.S. government to suspend the Cash-for-Clunkers program immediately as it believes the $3 billion in earmarked funds have already been used up.

NADA Chairman John McEleney told Automotive News that based on a survey of its dealers it believes the $3 billion in funding could be used up as of today. But according to the Transportation Department, only 411,624 claims have been filed, accounting for a total of $1,72 billion. The difference says McEleny is due to rejected claims that have yet to be re-submittted.

Transportation Secretary Ray LaHood, has said that the $3 billion should last until Labor day, but NADA’s track record is also pretty good, as the group was the one to raise the alarm that the initial $1 billion in funding, intended to run for several months had dried up in just two weeks.

Earlier in the week LaHood said that the Transportation Department is readying a plan to wind-down the Cash-for-Clunkers program, commenting that even if the fund dries up, the dealers will still be reimbursed.

[Source: Automotive News]

If you’ve been trying to decide whether or not to trade in your gas guzzler on a new fuel-efficient model and cash in on the government’s $4,500 CARS rebate, you’ve waited too long. The program, funded with 1 billion dollars of tax payers’ money is already running low – just six days after the Obama Administration officially launched it.

According to the NHTSA (National Highway Traffic Safety Administration), by the end of the Wednesday work day dealers had submitted 22,782 claims for a total of $95.5 million. 

At that rate the program will run out of money long before the planned CARS (Car Allowance Rebate System) expiration date of November 1st. Reuters cites Bailey Wood, a spokesman for the National Automobile Dealers Association, who speculates the program will run out of funding before the date.

The Cash-for-Clunkers legislation had been criticized heavily before being passed for not being sufficiently funded. 

The good news out of this is that if the CARS rebate system is used up (early or not) it is expected to generate as many as 250,000 car sales – something which should help speed up an economy that already shows signs of recovering.

Reuters cites an unnamed inside government source for the tip, who says the CARS program wil be suspended shortly. There is no word on if there are plans to find additional funding and re-instate Cash-for-Clunkers at a later date.

[Source: Automotive News]