Scrappage Incentive Considered
Plans could increase new car sales, but at what cost?
Business secretary Peter Mandelson has so far only confirmed his department is looking into a scheme like the one successfully introduced in Germany, where consumers are being offered €2500 grants to trade-in for scrap any car that is over nine years old. The result is that new car sales surged by 21% in Germany last month and the UK’s Society of Motor Manufacturers and Traders has been urging the government to quickly follow Germany’s lead. While there’s still no sign of an official announcement, Ford has now said it is definitely expecting a UK scheme to be implemented and is adjusting its budget predictions accordingly.
The SMMT says the government’s slow response is actually costing sales as customers wait to see if grants will become available as the industry clearly expects.
Meanwhile Mandy has become embroiled in an embarrassing bout of handbag-swinging with the Bank of England. He told the BBC the bank has responded too slowly to auto industry requests for support with new car financing. The bank responded with ‘puzzlement’, suggesting that providing sector-specific support was ‘clearly and properly a matter for government’.
The Tories have leapt on the spat, describing it as ‘worrying sign of division’ at a time when a united front is required.
t non-science based solution.I hope this does not come into force as it will mean that many of our future classics will have their lives terminated unnecessarily and very much prematurely when their prices dip below the payment level.
I just hope that someone has the right to resurrect these icons of motoring though I suspect the government will blanket the law so they have to be dismantled regardless of their condition.
This could potentially be a morally wrong policy of motoring genocide to prop up our ailing industry. If we’re moving in this direction then how long before modifications and repairs are restricted to force us to further prop up the industry?
Let's remember that the German incentive is currently limited to 600,000 for that VERY reason otherwise it would indeed be an open door to an absurd and counter productive situation.
It should cost the tax payer nothing as the sales generate VAT that otherwise would not have come in.
This is not additional credit by the way, it's a grant.
There is no viable Green argument either as making cars more financially accessible to people increases C02 both in terms of increased manufacturing and future usage.
I heard the figure was more like 40% energy use in production but even so it doesn't take into account all the damage from mineral extraction and scrapping. Does anybody have the real figures?
As a car enthusiast who finds a government who has been trying to make it harder and harder to run old cars I'd rather see the tax on new cars re-introduced as we don't keep them long enough. Say £10 (or £20) for every gramme per km C02 and dump the road fund license. But not until this recession is a memory.
BTW how does a Golf only do 14mpg?
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