Consumers get more flexibility on clunkers program

[August 14, 2009]  WASHINGTON (AP) -- Car shoppers running into shortages of certain vehicles at dealerships will still be able to use the Cash for Clunkers program to reserve the car of their choice, the Obama administration said Thursday.

The Transportation Department said consumers who want to purchase a new vehicle not available on a dealer lot would still be eligible for the car rebate program if they ordered it from the manufacturer. The move will help dealers and automakers who have struggled to keep hot-selling vehicles in stock because of the popularity of the government incentives.

"Allowing consumers to order vehicles and qualify for the rebate will expand buyers' choices and keep production lines running," said Transportation Secretary Ray LaHood. He said the department was "trying to make sure that everyone who wants to can participate in this wildly successful program."

Under the original rules, eligible car buyers who qualified for the incentives of $3,500 or $4,500 had to take delivery of the vehicle from the dealers' lot, limiting the choice of car shoppers. Dealers can now reserve a vehicle from an automaker by using a vehicle identification number and submitting the VIN with the paperwork to the government.

Automakers such as Ford, Toyota and Honda have increased production to meet demand. Ford Motor Co. said Thursday it was increasing production of its popular Focus and Escape models while Toyota Motor Corp. has said it will boost production of the Corolla sedan. All three have been among the top-sellers of the government program.

Through early Thursday, nearly half of the $3 billion program had been spent, prompting sales of 339,000 new vehicles. Congress extended the program last week, adding $2 billion to the car incentives. The funding could be depleted by Labor Day.

Michigan Republican Reps. Candice Miller and Fred Upton requested the changes to the program, noting that the rebates had caused a run on some fuel-efficient models and the slashed production levels would make it difficult to replenish inventories. Miller said Thursday the change would help "maximize the program."

General Motors Co. spokesman Greg Martin said the changes "will help customers get exactly what they want." Toyota had opposed the changes amid concerns it would create confusion. Spokeswoman Martha Voss said Toyota would do its best "to make sure our dealers are informed about the new procedures so they can take advantage of the opportunity."

[Associated Press; By KEN THOMAS]

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