Scrappage Scheme Debate part 2.

BBC Radio Five held a 2 hour talk show on the proposed UK 'Scrappage' scheme on Monday of this week and the debate was very healthy and certainly enabled different people with different interests to express their point of view. At the moment it isn't government policy to scrap any old vehicle in exchange for a £2000.00-£2.500.00* rebate(*figure not finalised) toward the purchase of a new or nearly new vehicle.

My initial thoughts were very positive as obviously getting rid of some of the old cars that contribute a higher percentage to the environment pollution wise is a good thing. It also helps stimulate the movement of the built up inventory in the car sector keeping this industry ticking over in what are clearly very difficult times. Then all the objections started to come through from other parts of the industry - particularly the mechanics who stay in work by repairing and replacing old parts on the cars.

The UK has been a victim of excessive service and maintenance charges and I can personally give examples of the exhorbitant charges you have to pay for new cars (within 3 years old)just to get routine services done through the main dealer. Hopefully the downturn will shake up the industry where this is concerned but paying over £500 for a routine service for any make of vehicle within 3 years is not acceptable.

The debate also discussed alternative ways of using the money instead of this scheme including investing the money into the public transport sector and improving mass transportation options. I will try and dig out the podcast to the debate and link it here for reference.
On a side note I found this very interesting blog on the Wall Street Journal
http://blogs.wsj.com/environmentalcapital/

Scrappage makes sense for consumers the manufacturers and the environment.

On my way home from work yesterday I was listening to the gloom about the UK Car market and how sales had fallen off a cliff. Meanwhile in another part of Europe ,in Germany, sales had lifted 21.5% , year on year.

Scrappage incentives are believed to be the main reason why Germany has bucked the trend.The news item also added that additional manufacturer incentives on top of the government scrappage incentive also played a part in the sales surge. The German auto industry body, VDA reported that new car sales in February reached 278,000 units - the best February in a decade.

Car buyers in Germany receive an €2,500 bonus towards a new car or a used car under a year old, if they trade in a car over nine years of age. In addition, manufacturer supports acted to reduce prices even further than the scrappage incentive.

The UK government in the meantime don't have the Scrappage system in place and clearly if the system was in place the industry wouldn't be in such a slump.Instead the Government are firing dead money into producing cars which the consumer has no incentive to buy. Getting the older Junkers of the road makes sense. The new modern fuel efficient engines would help reduce the C02 output. Get it sorted please Mr Brown.