- The Washington Times - Tuesday, August 11, 2009

Auto dealership lots - and even showrooms - are increasingly empty these days thanks to the “cash for clunkers” program, but most of the missing cars are made by foreign companies.

“People are going to think we’re one of the shut-down dealers,” said Tammy Darvish, vice-president of Silver Spring-based DARCARS Automotive Group, which sells cars from different manufacturers.

She was referring to her company’s Chrysler Jeep Dodge branch in Silver Spring. The store was not among those Chrysler Group LLC terminated in June, yet its showroom was barren Monday afternoon.

Through Aug. 31, Chrysler is offering to match the federal rebate of up to $4,500 on qualifying deals, allowing car buyers to get up to $9,000 in rebates.

Over the weekend, the program, which reopened with $2 billion in additional funding, kept DARCARS busy but things weren’t “crazy” like the weekend before, she said.

Ms. Darvish added, however, that the vast majority of the models sold by DARCARS under the rebate program have been made by Asian companies such as Toyota, Nissan and Kia.

“Do you think the government anticipated that 79 percent of the cars sold under this program would be imports?” she said.

Last year, 46 percent of DARCARS’ sales were Toyotas, she said. So far in the program, 72 percent of the company’s sales are Toyotas.

Six of the 10 most popular models purchased with the incentive are from foreign companies, according to a Department of Transportation report Friday.

However, Ms. Darvish noted that many foreign cars are actually built in this country.

“A majority of the Toyotas we sell are built in America,” she said.

Three of the top sellers - the Toyota Camry, Toyota Corolla and Honda Civic - are primarily made either in the United States or Canada for sale in the U.S. market.

The Toyota Prius, Hyundai Elantra and Honda Fit are made overseas.

Brand Fowler, vice president of Sheehy Auto Stores, said he isn’t surprised.

“That’s really what you’d expect because [foreign automakers] make the passenger cars that are the most fuel-efficient and are the top-sellers anyway,” he said.

“If Ford had more Fusions, they would be selling,” said Mr. Fowler, whose company has five area Ford dealerships but also six Nissan as well as other foreign-car outlets.

“Where we have inventory we still have a lot of good activity [in the ‘cash for clunkers’ program],” he said. “We’re working with some manufacturers to get some product as quickly as possible,” he said.

Ms. Darvish expects the program’s funding to be exhausted by the end of the month, while Mr. Fowler doesn’t see it lasting past Labor Day.

Responding to the inventory shortages, two congressmen pressed Transportation Secretary Ray LaHood on Monday to allow buyers to order their new cars from manufacturers.

In a letter to Mr. LaHood, Reps. Candice S. Miller and Fred Upton, both Michigan Republicans, noted that under current program rules, new cars have to be purchased from dealers’ lots.

The dealers are increasingly concerned about getting refunded by the government for the rebates they advanced to car buyers.

Ms. Darvish said DARCARS had sold 600 cars under the program so far.

“We have not gotten any money back, we are $2.5 million in the hole that we already fronted to the customers,” she said.

Sheehy is out a similar amount, Mr. Fowler said.

“We have a tremendous amount of money due from the government,” he said. “A lot of the banks are working with us on programs to bridge the gap, but it’s a lot of money. Longer than 30 days and it will start to create cash flow situations for most dealers.”

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