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Final CARS push as payouts near 100%

November 15, 2010

Dealers still struggling for CARS reimbursements have until Oct. 13 to notify the government of their hardships. The Transportation Department reported in late September that nearly all valid claims have been paid.

An exception process outlined Sept. 23 by the National Highway Traffic Safety Administration creates a process for dealers to obtain voucher payments. However, dealers must have completed CARS deals by the deadline and been unable to submit applications due to "hardship" caused by the agency.

The NHTSA on Oct. 2 still was examining several unique reimbursement issues, such as trade-ins that were held in trust or vehicles that were mistakenly categorized—Category 1 truck instead of a Category 2 truck.

Due to the overwhelming demand on the system and hotline from dealers, NHTSA conceded it could not handle or answer all of the questions or difficulties dealers faced, which led to some dealers being unable to complete and submit applications by the deadline.

Under the exception, dealers must describe in writing why they qualify for the exception and provide evidence of why the problem was the NHTSA’s fault.

"Such evidence may include copies of correspondence, such as electronic mail, documenting that the dealer contacted the agency regarding issues with its application. The dealer also must present proof that the qualifying deal was made on or after July 1 but no later than Aug. 25, 8 p.m. EDT, by submitting paper copies of all completed and signed supporting documents and certifications required," the NHTSA wrote.

Among interesting statistics from the program, 37 people accepted $3,500 or $4,500 on trade-ins that were less than 1 year old. Another CARS transaction involved a 1997 Bentley Continental R, which was one of the most powerful and exclusive cars in the world and valued new at $300,000 and beyond.

The most popular clunker was the Ford Explorer, with 69,887 copies turned in, accounting for roughly 10 percent of the trade-ins under the program. Toyota topped all makes with 19.4 percent of the 690,114 vehicle sales.