Cash for Clunkers Program: Used Car Dealerships feel the pinch slightly

CLARKSVILLE, IN (WAVE) - Despite the hiccups the federal Cash for Clunkers program has had, people turning in their gas guzzlers in for new cars.  At the same time, dealerships are claiming the government isn't reimbursing rebates quickly enough.  Even in Indiana, Auto Salvage dealers say it's hurting their business because they can't sell parts.  The cars are being destroyed.  But, how has the cash for clunkers program affected used car dealers?

Business at several used car dealerships has declined slightly, but dealerships are managing.  At Jim Butner Auto, open since 1955, owners have seen used cars exiting the lot with new owners.  Through the years that hasn't changed.  But, Bo Butner does believe the new Cash for Clunkers program is changing business a bit.  "They are destroying a lot of cars we would buy and resell 'cause there's a lot of nice cars they're getting off the road," Butner said.

Butner said it is becoming harder to find cars to place for sale on their lot.  He said he was fortunate because he had bought about 400 cars before, but right now he can't do that.  'We're lucky to buy 20 to 30 a week, which we used to be able to buy that a day," Butner said.

He said the program isn't impacting his customers.  He has faithful followers, but in the long run Cash for Clunkers could have some impacts.  "A lot of the cheaper priced cars that people are wanting to stay love and low pay, they're going to be gone," he said.

At Kia of Clarksville, General Manager, Pat Bates, said people are still stopping-by buying new and used cars.  "Not everybody has a cash for clunker, thank goodness.  So, used cars are still selling to people that don't have that trade-in," Bates said.

While it has taken a slight toll on the sale of used cars, they've found ways around it.  "I've had customers come in on the clunkers -the 35 or 45-hundred is what they qualify for and their car is actually been worth $5,000.  So, we didn't take it through the clunker program," she said.  "We took it in trade. So, I could put on my used car lot.  A couple of customers have been pleasantly surprised that their trade-in has been worth more than the government was going to allow them," Bates said.

It has guaranteed Kia of Clarksville placing a used car on their lot instead of destroying it under the cash for clunkers program.

So far, about 185,000 cars have been sold under the cash for clunkers program.  Another $2 billion dollars was added to the program, which the federal government hopes will last into Labor Day.