Frustrated with delays, rejections and computer-system crashes, several New Hampshire auto dealers are making car buyers pledge to cover rebates if the federal government doesn't come through with checks under the Cash for Clunkers program.
Auto dealers say they are doing so because the federal government is a clunker when it comes to sending out rebate checks of $3,500 or $4,500 per car.
But a state consumer protection official said there could be a problem with such a pledge, and at least one customer has refused to sign it.
The New Hampshire Auto Dealers Association created the draft agreement earlier this month and sent it to members, said President Peter McNamara.
Some dealers aren't using the agreement. Others are negotiating the agreement into the deal. McNamara said dealers are having problems getting rebates from the federal government, despite a law that requires any rebate application to be answered within 10 days.
At Bonneville & Son in Manchester, the company has not received a single rebate, despite the 70 Cash for Clunker deals it signed since late July. Manchester Subaru has had one of 25 rebates approved.
In Swanzey, the dealership that includes Toyota of Keene is waiting for money from 130 rebates.
For some dealers, the IOUs surpass $500,000, McNamara said. "For any dealer, $100,000 represents a serious cash-flow issue if you don't know when it's going to come in," he said.
►Cash for Clunkers to end on Monday (6)
Bonneville has car buyers sign statements that terminate the deal if the rebate does not go through, he said.
"The government changed the rules a couple of times, and it kind of puts you on edge," said John Berry, general manager at Bonneville, a Chrysler-Kia dealer.
UnionLeader.com - New Hampshire news, business and sports - NH customers asked to cover tab for clunkers - Friday, Aug. 21, 2009
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