The three biggest US carmakers GM, Chrysler, Ford need money from the government to bail out.

UK auto body wants scrappage scheme to boost new car sales

The Society of Motor Manufacturers and Traders (SMMT) in the UK have stressed the need for an urgent scrappage scheme to breathe life back into the car market.


'It is vital that car buyers are given the confidence to buy now and a scrappage incentive scheme is a clear signal which has already proved successful in other EU member states. The UK government must align with Europe and take immediate action to protect its automotive sector.'


In Germany, drivers who trade in cars that are more than nine years old will receive 1,000 Pounds. Spain has also recently introduced a similar scheme and the car industry expects hundreds of thousands of new cars to be bought as a replacement for the scrapped vehicles.


In January, the UK government announced that it was considering introducing a 'scrappage' incentive scheme for motorists, designed to help stimulate the ailing car market and accelerate the transition to less-polluting vehicles.

The government was looking at schemes to help drive demand for such vehicles during the recession.


The SMMT believes that the introduction of this scheme in the country will help up to 250,000 cars and 30,000 vans go through a similar scheme in the next one and half years. The move will also reduce carbon dioxide emissions by taking older, more polluting vehicles off the road, it added.


A proposal detailing a scrappage scheme for the UK The scheme proposed allowing cars and vans more than nine years old to be scrapped in return for a 2,000 Pounds cash incentive towards a new or nearly new vehicle.


Scrappage program to boost consumer demand for new cars.


Environmentalists, however, are likely to be lukewarm about the scheme unless the incentives are structured to ensure motorists do upgrade to genuinely lower-carbon vehicles and that net carbon gains are delivered by scrapping older vehicles.

The UK Government to introduce a car-scrappage scheme to kick-start consumer demand for new cars.


Scrappage schemes have already been introduced in Germany and France, where owners who trade-in cars of around nine years old receive a cash incentive of almost 2000 Pounds if they subsequently buy a new environmentally friendly car.


Auto car reports that Ford Europe's sales chief, Ingvar Sviggum, said the company has included sales from a UK scrappage scheme in its budget for 2009.


Paul Everitt, the chief executive of the Society of Motor Manufacturers and Traders, said that scrappage-incentive schemes would help stimulate consumer demand.


'There is a significant amount of unsold cars out there. If we can use a scrappage mechanism to shift those cars and begin to create a steady flow of demand, then factories can start to operate.'

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