GM to provide cash advances to dealers for CARS rebates
Posted on Aug 20, 2009 by Zane Merva in Business
This morning General Motors announced it would be providing cash advances to dealers equal to the amounts they are currently owed under the government run CARS rebate program. The advances will allow dealers to stay in business until the rebates are processed.
Many dealerships have still not been reimbursed for vehicles they’ve sold that qualify under the program. With tens of thousands of dollars of rebates not yet paid for, many dealers are feeling a cash crunch once again and have stopped selling vehicles under the program. GM hopes the cash advances will not only keep dealers in business but once again spur new business. The company recently announced it would produce an additional 60,000 vehicles during the 3rd and 4th quarters of 2009 to meet increased demand.
GM Statement Regarding CARS Program Rebates
In order to meet high customer demand for new fuel-efficient GM cars, crossovers and trucks under the Federal CARS (Cash for Clunkers) Program, the company will today begin providing cash advances to dealers which are equivalent to the amount of federal rebates which are being processed for that dealership’s qualifying new vehicle sales. As a result, dealers will have the liquidity to run their businesses effectively in the midst of this extremely successful program, and to continue immediately delivering new vehicles to GM customers.
“Our sales performance in the past two months has exceeded our internal forecast by over 60,000 vehicles, largely driven by the CARS stimulus program,” said Mark LaNeve, VP of U.S. Sales. “We want to do all we can to provide customers with timely new vehicle deliveries and dealers the liquidity they need to run their businesses. This will continue the sales momentum of our new fuel-efficient vehicles such as the Chevrolet Cobalt, Equinox and Buick Enclave.”
GM intends to provide these advances for qualifying new vehicle sales already transacted under the CARS program, and will provide advances going forward as long as the CARS program is in effect.
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