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Ford expects the government to introduce a scrappage subsidy to help new car buyers some time this year.

Ingvar Sviggum, Ford Europe sales chief, said that the company has included boosted sales from a scrappage scheme in its budget predictions for the year.

“I really expect that the British will introduce a scrappage scheme,” said Sviggum.

Other industry figures are making the same assumption, Autocar has learned, although there’s no word yet on when the subsidies will be i...Read the full article

Autocar:

Now, the SMMT says that the uncertainty over the implementation of a scheme is actually costing sales, because some buyers are holding off until an official announcement is made.

So they've gone off half-cocked, shot themselves in the foot, the plan has backfired....

Still would like to see SMMT come forward and justify this supposed eco scheme - for that's what it'll need to fly under, as Germany's scheme does, in order to win approval from the EU - by providing the data on the average age of UK's car fleet. My guess would be that it is a lot younger than Germany's, France and Italy's too. The UK new car market boomed in 2002-7 especially, which would suggest a lot of around six year old cars rather than the ten year plus old cars in Germany, which are now being scrapped. This reduces the scope for a 'scrap an old, polluting banger' scheme straight away. And what does SMMT say about UK's high proportion of company car purchases, compared to other European countries? Approximately two thirds of all new cars in UK are bought by companies. If they are not to be eligible, which they shouldn't be, the scope for this scheme is reduced to a miserable rump. Could this be why SMMT/Government is tardy in bringing forward this demanded scheme?

I am with you Horse, it will be interesting to see what happens.  I am not convinced of the scheme, people are not buying cars and I cannot see the scrappage scheme being relevant.

250K cars seems a lot and I think before the gov. gives out the money, I think such as Ford should reduce the prices of the cars; the dealers should not expect full price (if they take part) and neither should the manufacturers; there needs to be balance and the manufacturers and dealers who want to take part should shoulder some of the cost.

Maybe for every purchase, the manufacturer/dealer (if they decide to take part and or its effectively a scrappage scheme purchase) pay 50% of the cost i.e. if the scheme is £2K to the customer, then the dealer/manufacturer (under a scrappage scheme purchase) shoulder £1K and the gov. shoulders £1K.....that to me would be fairer....and it would have to be at the list price of the unit less at least 2-3% (or something) that the consumer would usually get for discount......that would be reasonable I think; maybe the at least percentage should higher??.....but I think a scheme something like that.

Ford's case might sound more convincing if they actually made cars in Britain.

Blimey H&C, I thought my colleagues in the fifth estate were cynical! How is the SMMT meant to lobby the government without doing it in the public domain? Maybe HMG deserves a light booting for being so dozy in introducing the scheme. The word is that procedurally, it doesn't need to be introduced in April's Budget, although many people expect it to be. But to have any effect it has to be up and running well before September so it can be marketed. The model for this is the German scheme, which has lifted sales enormously. Ford's feedback is that people who have never bought a new car are now heading into dealerships. They're buying the cheaper end of the range - Ka, Fiesta, Focus - but with a rich mix = Titanium and Ghia spec. I agree with North that the log-jam in loan finance is still a big stumbling block. Dealer finance anyone? The German experience also shows that dealers are matching the EU2000 gvt incentive with an equivalent dealer discount. Interestingly, the Germans are said to be about to end the scheme - in six weeks or so, I hear - but Ford believes that it'll be extended. incidentally, the annualised effect on the German market is reckoned to be an extra 1.2m units. Together with the other ten so countries with schemes, Ford's SAR for the EU19 countries has lifted by 2m units to 15.6m since January....... A cautionary point though — the Spanish scheme is reckoned to be too complex and hasn't worked. And knowing HMG's legendary ability to complicate financial matters, in a cynical moment it wouldn't surprise me if they announced a scheme and then made it so complex that no-one could claim the money back.....See we can be cynical, too!

Would have thought car sales being down is doing the UK trade deficit a favour. Also there seem to be hardly any band B or less cars manufactured in the UK, so any eco subsidies would almost be certainly detrimental to the trade balance.

Ford put there prices up 4.7% and Vauxhall did similar, let the manufactureres do their own discounting and leave the taxpayer out of the equation.

another idea... new car incentives for people depending on salary or income per household? then put a limit on the price of the new car so people don't take the michael

Julian Rendell:

.....See we can be cynical, too!

You do yourself down, it's not cynicism but hard-won experience and honed intuition.

What you say above is right regards the current German scheme - although it's €2,500 not €2,000. The current scheme is limited to a €1.5bn pot, or 600,000 amounts. Could well be extended as the VAT, 19% in Germany, brings most of it back.

Still would like though, Julian, SMMT to explain how a German type scheme would work in Britain. Britain has proportionately far fewer over 9 yr. old cars than Germany and a far greater proportion of company car purchases, which are not eligible in the German scheme. Once we can see the potential amount of cars eligible for scrapping we can have a better idea of the prospects of a significant boost to overall sales, or not.

I'm with sportwagon with this.

Ford should have thought twice about closing down final assembly of cars in its biggest European market if it wanted to continue to have any influence with the UK government.

Ford must be losing money hand over fist importing small, non-premium cars from Germany to the UK given the strength of the Euro against sterling, but it's their own s*dding fault. By pressing the UK for a scrappage scheme, they are effectively asking us to compensate them for the currency losses they have incurred by closing down factories in this country. I can think of no less appropriate use of UK taxpayers money than this. Send the cheeky b*ggers packing with a flea in their ear!

horseandcart:

Britain has proportionately far fewer over 9 yr. old cars than Germany and a far greater proportion of company car purchases, which are not eligible in the German scheme

Horse. True, but private/company in the UK is about 45/55 isn't it? In any case, scrappage would probably push private sales quite well. As well as sales of old cars with an MOT....

Firstly, I wanted to say that I think GMTV is absolutely superb!....re. my comments the other day were purely focused at Mr. Q Wilson not GMTV (GMTV is brilliant!)

Second, HiltonH; people are not buying cars as they are putting more money into mortgages, savings incase they are made redundent etc.....most people I know say they will not use it and just stick with what they have unless they are forced to change.

That is your problem; I also think the UK tax payer should not pay for Ford's or anyone elses bonuses, big company cars, big expense accounts, or exchange rates as pointed out by those above...etc......thus the manufacturers have to reduce the prices of the cars as do dealers.....they are asking us for an incentive...fine, but the cost is "shared" as it is a "shared responsibility" thus the dealers (those who want to do this scheme) and the manufacturers (those who want to do this scheme) per purchase under the scheme need to share the cost......i.e. if its £2K, dealers and manufacturers must share at least £1K etc....as I said above plus a dicount on the cars (as would be normal).

Third; Horse is right also, we do not know what we are signing up to....where are the figures, where are the facts about the ages of cars, the numbers of people likely to buy etc......also re. the old cars.....you must have owned them for say "three years" (is what I think) and the srappage scheme should last for one year......this is not a license for all in the motor trade to print money......they are asking for help and that should be shared.

NB; personally I am not in favour of this anyway......I was not in favour of the UK Gov. making so much money available to one trade in first place (it should have been technology based) i.e. for the technology sector not just the motor sector; but here we are £2.3bn (or whatever) lighter and then they want more without lowering cost of cars.....its crazy and WRONG.....they (inc. dealers) need to share the cost.

The SMMT is great at its own PR...but where is its facts and figures....as Horse says, lets see them.....HiltonH...you know people at SMMT.....tell them to publish all the relevant facts and figures and then lets have a debate; you could get an exclusive!

 

HiltonH:

but private/company in the UK is about 45/55 isn't it?

according to SMMT's figures, in 2008 the breakdown of new car registrations was as follows:

'private': 41.9%  'fleet': 52.1%  'business': 6.1% (rounding errors)