SOUTH GLENDALE — Frustrated auto dealers struggled with the overwhelmed “cash for clunkers” online system Monday, scrambling to remain eligible to receive rebates for cars sold under the federal program.
Dealers feared that missing the deadline could cost them tens of thousands of dollars in losses for cars they had already moved off their lots, but had yet to register into the system.
Worries about potentially lost rebates spurred a nationwide frenzy to access the Internet portal for the Car Allowance Recovery System, which was so overloaded in advance of the government’s 5 p.m. deadline that it crashed several times Monday, prompting the Obama administration to extend the cutoff time for online submissions to 9 a.m. Tuesday.
All sales under the program still had to be completed by 5 p.m. Monday, although no local dealers were taking a chance on testing that deadline. Most lots had wrapped up their clunkers sales by Sunday and had since begun turning down shoppers interested in the program, instead diverting them toward automaker promotions and used car trade-in options.
Several local outlets had yet to register more than seven clunkers into the strained online system as of Monday afternoon. Many worried about losses in the tens of thousands because of anticipated government rebates worth between $3,500 and $4,500 per vehicle.
Bob Smith Toyota and Scion in La Crescenta had yet to submit 20 transactions to the system by midday, although sales representative Ron Smith was confident the store would be able to register the information by 9 a.m. Tuesday.
“We have to,” Smith said. “If we want to get paid they have to be in.”
The dealership had sold 155 cars through the program, but has been slowed down by the online system, Smith said.
Other dealers were fuming about the program, which they credited for generating business but criticized for being loaded with administrative problems, including qualification and submission rules.
“The whole thing was screwed up,” said Roger Cowan, general sales manager at Community Chevrolet in Burbank, who said not only was the online system flawed, but some cars that had been “billowing smoke” had not been deemed eligible for the program because they received better than 18-miles-per-gallon fuel economy, according to fueleconomy.gov.
Troubles with the Internet system added a final layer of problems to dealers already frustrated with the program, said Cowan, whose lot had yet to register eight of its 30 clunker transactions because of problems staying connected to the website.
Representatives at Glendale Nissan faced such problems with the online portal that they opted to work until 3 a.m. some nights to register most of its 177 total program transactions and still had three to report as of Monday afternoon.
“That’s the only time you can get online to do it,” said General Manager Evan Kanes, explaining that the online system was so overloaded that the best time to gain access was when other industry workers were asleep.
His dealership was not alone.
Workers at almost every local dealership found themselves clicking through the clunkers website instead of sleeping during recent weeks, with some dealerships staying at it until 4 a.m.
“It’s a pain in the butt,” said Kanes, who added that in addition to being at risk of about $13,500 in lost funds because of the slow Web system, his expenses were growing. “I’m paying a lot of overtime.”
The National Highway Traffic Safety Administration, which administers the clunkers program, had expanded the website from its initial capacity of 12,000 simultaneous users to its current 30,000-user capability, but even that wasn’t enough to prevent problems Monday, according to the agency.
And although the agency had initially planned to reimburse all dealers within 10 days of receiving completed online submissions, no local dealer has received more than four rebate payments from the government, with most dealers receiving only one.
While the program had boosted activity and tripled business at some dealerships, it has created major headaches, said Alex Tamez, general manager at Star Ford.
“It’s a great program, brought a lot of customers, sold cars that needed to be sold, but the program’s administration has just been pathetic,” Tamez said.
Still, one dealer executive was relaxing Monday after having submitted all of his 30 transactions online by Sunday evening, even though it took him staying up until 3 a.m. some nights to get it done.
Rich Smith, chief financial officer of Ellis Family Stores, which owns Glendale Dodge, had already received three reimbursements and was confident that the rest would come through eventually.
Chrysler will help the dealership by offering to reimburse lost funds for submitted transactions until the government pays up, Smith said.
“Not only do we have it all in, but Chrysler is helping us out, and we have all that in too,” he said.