"Our existing scrappage deals have been hugely successful – so far in April we are 10% up on last year in a market that's still 30 per cent down."
Hyundai has also indicated it will sign up. MD Tony Whitehorn said: "Although we had hoped for a £2000 contribution from the government, £1000 will help drive business through our doors at this time of recession.
"We will strive to match this price or an even higher price once the details have been confirmed."
Kia gave the scheme a cautious welcome, but criticised the part-government, part-manufacturer funding proposal and stopped short of saying it would definitely sign up to it.
Paul Philpott, managing director of Kia UK, said: "Kia welcomes the government’s positive response to the difficult times facing the new car market but I am personally disappointed that our chancellor is only going half-way compared to other European governments.
"The devil will be in the detail and I am sure the Society of Motor Manufacturers and Traders will be looking for early meetings with the Treasury to discuss this.
"The reality is that the government is shifting a large part of the cost of this programme onto the shoulders of the manufacturers, when it is the manufacturers who are working hard night and day to deal with the effects of the economic turmoil and recession around the world."