Want to trade a clunker? Act fast

WASHINGTON -- The popular but overwhelmed "cash for clunkers" program is zooming toward a quarter-million trade-ins with the initial $1 billion in rebates, but the White House warns that the special deals could sputter to an end by Friday unless the Senate quickly approves $2 billion more.

Senate skeptics appear to be in no hurry.

On Monday, the Obama administration pointed to environmental gains made during the first week of the program, which gives rebates of as much as $4,500 to motorists who trade in gas guzzlers for more fuel- efficient vehicles. The White House also highlighted recovery news from Ford Motor Co., which reported its first U.S. sales increase in nearly two years.

July auto sales rose to 11.2 million when converted to an annual rate. That's the first month this year that sales rose above the depressed 10 million level. As recently as 2007, car and light truck sales topped 16 million vehicles, but a drop in consumer confidence sent sales plunging late last year.

Ford, which steadily has been gaining sales since GM and Chrysler took government aid and went through bankruptcy proceedings, reported a year-over-year sales increase, up 2.4 percent for the first year-over-year sales jump since November 2007.

Troubled Chrysler posted a smaller year-over-year sales drop compared with recent months, announcing that sales fell 9.4 percent. GM reported a 19 percent decline, far less than in past months.

"It's good for consumers. It's good for dealers and auto manufacturers," White House spokesman Robert Gibbs said. "It's good for our energy security and our environment."

Gibbs said if the Senate failed to provide the extra money, "it's unlikely that we'll make it to the weekend with a program that can continue." He estimated that the additional $2 billion would allow consumers to take advantage of the incentives through September.

In the Senate, Democrats remained concerned about lining up enough support for the extra money, which the House approved last week.

While lawmakers haggle over the details, here are some questions and answers about what you should know if you want to buy a car under the program:

Q: Is cash for clunkers still on? Can I still qualify?

A: According to the government, yes. But for how long remains unclear. There's been a lot of confusion about this, especially after the news came out late last week that the program was running out of cash. The Obama administration says sales made under the deal are covered for now, but the government is waiting to see what Congress does before making concrete promises.

The House voted last week to add $2 billion to the program, and the Senate is expected to take up the same bill this week. If the Senate doesn't approve it by Friday, the program probably will end.

Remember, the program still has restrictions, such as the fuel efficiency of the car you're trading in. The government Web site has all the details.

Q: What will happen when I go to the dealer? Are car lots still offering the deals?

A: It depends on where you go.

Some dealers stopped making cash for clunkers deals Monday, fearing they could lose money. Under the program, dealers take the value of the rebates, which range from $3,500 to $4,500, off the price of the car. They then go to the government to get reimbursed for that amount. As a buyer, you don't have to do anything. You get the credit when you buy the car. So all the risk is on the dealer.

Many were still offering the deals Monday but said they weren't sure about the rest of the week. Others are making only verbal deals that will go through if more money comes into the program. Some are telling buyers they'll have to bring back their new cars or pay back the rebate if their applications are rejected when submitted to the government. Some dealers are holding off on sending trade-ins to be scrapped, in case the deals don't work out and the buyers need their old cars back.

Q: Will I still be able to find the car I want and get the credit?

A: If you've had your heart set on that cherry-red Focus at your Ford dealership, you probably should act fast. Dealers say their inventories are running low because of high demand under the program.

Usually, a dealer can find you a car from somewhere else if the cars on the lot don't fit your tastes. But with so much uncertainty over how long this will last, some dealers are saying they might not be able to fulfill specific buyer wishes, such as color and interior, and still offer the credit.

"If you want a green car with a blue interior and we can't find it, we're not going to do the deal today," said Jeff Crippen, owner of a Lansing, Mich., dealership that sells Buicks, Pontiacs, GMCs, Mazdas and Volvos.

Q: What are the chances the program will be extended the way it is now?

A: The House version would, for the most part, just add new money.

But the Senate might tinker with the program, such as raising the fuel economy requirements for cars to qualify for the rebates. Any Senate changes to the bill would require the House to take up the issue again. House members left for summer recess last week, with no plans to return until September.

How's it all going to shake out? Stay tuned.