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'Clunkers' program creates car shortage

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A sign at a Ford Dealership advertises the Cars Allowance Rebate System (CARS) program, also known as "Cash for Clunkers," in Fairfax, Virginia, on August 1, 2009. The program is based on a cash incentive for people to trade in older vehicles for new, more fuel efficient models. The U.S. House of Representatives approved an additional $2 billion for the program yesterday after the initial $1 billion set aside for rebates to car buyers quickly ran out after high demand. UPI/Alexis C. Glenn 
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Published: Aug. 8, 2009 at 1:11 PM
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DETROIT, Aug. 8 (UPI) -- Inventories of the most popular car models being sold under the cash-for-clunkers government incentive program are running low, U.S. automakers say.

Chrysler Group LLC and Ford Motor Co. say they're having trouble keeping such models as Dodge Caliber, Dodge Avenger, Jeep Compass and Jeep Patriot in stock even as the U.S. Congress authorized $2 billion to extend the program, The Detroit News reported Saturday.

"We sold out a week ago," Steve Demers, general manager of Cueter Chrysler Jeep Dodge in Ypsilanti, Mich., told the newspaper. "While I am happy that the additional money was approved, I, along with others, will not be able to take advantage of the demand."

A Chrysler spokeswoman said the automaker's Belvidere, Ill., assembly plant was trying keep up with the demand for Calibers, Compasses and Patriots created by the cash-for-clunkers program, under which rebates of $3,500 or $4,500 on more fuel-efficient models are being offered.

At Ford, meanwhile, a spokesman told the News no production boosts were being planned even as stocks of the Ford Focus and Escape, the second- and seventh-best sellers among "clunkers" customers, had dropped to 25 and 21 days, respectively, by the end of July.

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