Car scrappage scheme 'saved 4,000 UK jobs'

[gingerpaul]

http://www.telegraph.co.uk/finance/newsbysector/tr...

It cost the government £400M, and presumably the dealers the same and the goverment only covered half of the £2k per car on offer. Mandelson says they saved 4000 UK jobs. Correct me if I'm wrong but doesn't that equate to the government paying £100k per saved job.

Was this a wise investment? I wonder how many jobs were saved elsewhere around the world. I wonder what percentage of the money ended up supporting Korean maufacturing.

[Frankeh]

gingerpaul said:

http://www.telegraph.co.uk/finance/newsbysector/tr...

It cost the government £400M, and presumably the dealers the same and the goverment only covered half of the £2k per car on offer. Mandelson says they saved 4000 UK jobs. Correct me if I'm wrong but doesn't that equate to the government paying £100k per saved job.

Was this a wise investment? I wonder how many jobs were saved elsewhere around the world. I wonder what percentage of the money ended up supporting Korean maufacturing.

I wonder how the US scheme did in comparison.

[Negative Creep]

so what happens when the used car market is flooded by Korean economy cars?

[Frankeh]

Negative Creep said:

so what happens when the used car market is flooded by Korean economy cars?

The AA get less calls?

[tangent police]

Negative Creep said:

so what happens when the used car market is flooded by Korean economy cars?

Several people create amusing V8 versions?

[gingerpaul]

Frankeh said:

gingerpaul said:

http://www.telegraph.co.uk/finance/newsbysector/tr...

It cost the government £400M, and presumably the dealers the same and the goverment only covered half of the £2k per car on offer. Mandelson says they saved 4000 UK jobs. Correct me if I'm wrong but doesn't that equate to the government paying £100k per saved job.

Was this a wise investment? I wonder how many jobs were saved elsewhere around the world. I wonder what percentage of the money ended up supporting Korean maufacturing.

I wonder how the US scheme did in comparison.

Good question, it'd be an interesting comparison.

[patmahe]

Frankeh said:

Negative Creep said:

so what happens when the used car market is flooded by Korean economy cars?

The AA get less calls?

And there will be an abundance of cheap, high quality commuter/shopping cars with long warranties

[WEHGuy]

I wonder what the best car to get scrapped was?

[oyster]

gingerpaul said:

http://www.telegraph.co.uk/finance/newsbysector/tr...

It cost the government £400M, and presumably the dealers the same and the goverment only covered half of the £2k per car on offer. Mandelson says they saved 4000 UK jobs. Correct me if I'm wrong but doesn't that equate to the government paying £100k per saved job.

Was this a wise investment? I wonder how many jobs were saved elsewhere around the world. I wonder what percentage of the money ended up supporting Korean maufacturing.

You forgot about the VAT.

At last year's 15% rate, the government actually made a profit for each scrappage scheme vehicle costing more than £6,667. The scheme basically paid for itself.

The 4,000 jobs are pure profit.


And assuming it did boost Korean engineering. You do know we're in a globalised economy? If Korea is performing badly, then it affects other countries too.

[Frankeh]

Wasn't there a real classic that got scrapped? I'm sure I read about it somewhere.

[Ewan S]

JDMFanYo said:

Obviously not the 'best'.

A number of 106 rallyes were scrapped, which is crazy because they would have sold privately for £3k.

Such a shame

I heard a couple of Mercedes 190 2.3 or 2.5 16v cosworths were also scrapped. Gutting!

[Talksteer]

gingerpaul said:

http://www.telegraph.co.uk/finance/newsbysector/tr...

It cost the government £400M, and presumably the dealers the same and the goverment only covered half of the £2k per car on offer. Mandelson says they saved 4000 UK jobs. Correct me if I'm wrong but doesn't that equate to the government paying £100k per saved job.

Was this a wise investment? I wonder how many jobs were saved elsewhere around the world. I wonder what percentage of the money ended up supporting Korean maufacturing.

It was a crazy investment, something like 80% of the cars manufactured in the UK are exported so the scrappage scheme will have had a minimal effect on the production outputs of UK factories not least because in the main the UK produces larger cars that are less popular under the scrappage scheme.

As for the jobs saved I suspect most were probably in car retail. From an economic point of view jobs in retail are not worth a penny of government money to support. Retail is entirely flexible relatively low in infrastructure requirements and with negligible intellectual property. I mean how often has the spread of goods been hed back by the lack of somebody to sell it!

The £400m would have been better spent in loan guarantees, training and R&D credits in the automotve industries.

[louiebaby]

oyster said:

You forgot about the VAT.

At last year's 15% rate, the government actually made a profit for each scrappage scheme vehicle costing more than £6,667. The scheme basically paid for itself.

The 4,000 jobs are pure profit.

That's a good point. Although it is impossible to know which of the sales would have gone through anyway, I suspect looking at it that way, it wasn't such a bad idea...

[dilbert]

louiebaby said:

oyster said:

You forgot about the VAT.

At last year's 15% rate, the government actually made a profit for each scrappage scheme vehicle costing more than £6,667. The scheme basically paid for itself.

The 4,000 jobs are pure profit.

That's a good point. Although it is impossible to know which of the sales would have gone through anyway, I suspect looking at it that way, it wasn't such a bad idea...

That's all well and good, but the VAT wouldn't then have been spent on a hospital or a teacher would it?

[oyster]

dilbert said:

louiebaby said:

oyster said:

You forgot about the VAT.

At last year's 15% rate, the government actually made a profit for each scrappage scheme vehicle costing more than £6,667. The scheme basically paid for itself.

The 4,000 jobs are pure profit.

That's a good point. Although it is impossible to know which of the sales would have gone through anyway, I suspect looking at it that way, it wasn't such a bad idea...

That's all well and good, but the VAT wouldn't then have been spent on a hospital or a teacher would it?

Eh?
This VAT income wouldn't have existed if it hadn't been for the scrappage scheme.

I'm sure some purchases under the scrappage scheme would have happened already but looking at the car sales figuers and large majority of them were NEW sales.

[dilbert]

oyster said:

dilbert said:

louiebaby said:

oyster said:

You forgot about the VAT.

At last year's 15% rate, the government actually made a profit for each scrappage scheme vehicle costing more than £6,667. The scheme basically paid for itself.

The 4,000 jobs are pure profit.

That's a good point. Although it is impossible to know which of the sales would have gone through anyway, I suspect looking at it that way, it wasn't such a bad idea...

That's all well and good, but the VAT wouldn't then have been spent on a hospital or a teacher would it?

Eh?
This VAT income wouldn't have existed if it hadn't been for the scrappage scheme.

I'm sure some purchases under the scrappage scheme would have happened already but looking at the car sales figuers and large majority of them were NEW sales.

Perhaps, but that's not certainty, and to be true the government must have been pessimistic whilst they were telling everybody else to be optimistic.

[Olivera]

patmahe said:

Frankeh said:

Negative Creep said:

so what happens when the used car market is flooded by Korean economy cars?

The AA get less calls?

And there will be an abundance of cheap, high quality commuter/shopping cars with long warranties

I reckon the 'green' credentials of the scrappage scheme are an utter fallacy. I predict that most of the Korea-box i10s bought through this scheme will be scrapped as soon as the 7 year warranty expires.

[BlueMR2]

Shouldn't the title to this thread be - Scrappage scheme saved 4000 jobs, for 12 months.

[ZeeTacoe]

BlueMR2 said:

Shouldn't the title to this thread be - Scrappage scheme saved 4000 jobs, for 12 months.

I was gonna say whats going to happen to those job this year now that the plebs have their Korean hatches?

[shirt]

so how many redundancies were made last year in industries not propped up by ukplc or those the government refused to help? I'm sure I read that car sales were only down 10% year on year prior to the scheme, whoopee.