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Scrappage scheme 'will make little difference’

Scrappage scheme 'will make little difference’

Category: Car insurance

Updated: 18/05/2009
First Published: 18/05/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Critics of the Government's car scrappage scheme say it is not generous enough and will make little difference.

From today, motorists with vehicles that are ten years old or more are eligible for a £2,000 discount on a new model when they scrap their old car.

The Government will offer consumers £1,000 when an old car is scrapped while vehicle manufacturers will offer a discount of the same amount on new models.

The £300 million scheme should provide a boost to the car industry and kick-start sales, Lord Mandelson said.

Hopes that the programme will be successful have been boosted by the relative success a similar scheme had in Germany, where new car sales have increased by an impressive 40 per cent since March.

Furthermore, since the scheme was unveiled in April's Budget by Alistair Darling, Lord Mandelson says there have been a flood of enquiries from customers.

The AA are also supporting the scheme and believe it could mean a £2 billion boost for the UK car industry

However, director of engineering at loss valuation and settlement specialists TLSS, David Patten, says while any action to boost motor sales should be supported, the car scrappage scheme will make little difference in isolation.

He also alluded to a recent survey which found 81 per cent of people questioned said they would not sign up to the scheme.

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