Transportation Secretary Ray LaHood assured car dealers Wednesday that they will be reimbursed for the popular Cash for Clunkers program, responding to complaints over a backlog of rebate payments.
"I know dealers are frustrated. They're going to get their money," LaHood told reporters. He said the Obama administration would soon announce how much longer the $3 billion car incentive program will last.
Through early Wednesday, auto dealers have made deals worth $1.81 billion and are on pace to exhaust the program's funds in early September. The program offers car buyers rebates of $3,500 or $4,500 for trading in older vehicles for new, more fuel-efficient models and has generated more than 435,000 vehicle sales.
Some car dealers have said their reimbursement requests have not been approved, leading to a cash crunch at their businesses. Dealers typically borrow money to put new cars on their lots and must repay lenders within a few days of a sale.