A new scrappage scheme is just what the country needs
PUBLISHED: 07:32 25 August 2017
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Opinion: A new car scrappage scheme would be a win-win for everyone, says Nick Conrad
So do we need a new scrappage scheme? Last time around 300,000 new cars were sold and the average emissions, of those new cars, dropped by more than 15pc. So environmentalists are calling for the government and the automotive industry to set aside a pot of money to help Mother Nature.
A new scrappage scheme would have the added bonus of putting a defib on declining car sales (dropping for the last four months). The picture is rosier than the plummeting sales, job losses and frozen production lines we witnessed nearly a decade ago – however, some would argue that we should act quickly to ensure we don’t return to the dark days of 2008.
And couldn’t we kill two birds with one stone here too? By selling new cars we also promote more efficient and less polluting vehicles. Despite the harmful fumes caused by manufacturing new cars, carbon emissions are a quarter lower than in the vehicles they replaced. A recent survey concluded that the British consumer was open-minded about moving to new greener technology. The stumbling block is the cost.
Manufacturers have now seized the initiative and started their own mini scheme. Driven by a desire to stimulate demand, rather than environmental reasons, they are attempting to entice the consumer in parting with old for new. Ford has become the latest car manufacturer to offer their own deal to exchange your car. The company will give customers £2,000 to get rid of their old vehicle in exchange for a newer one with lower emissions. Unlike schemes by BMW and Mercedes, which are only for diesels, Ford will also accept petrol cars. The company has assured critics that all part-exchanged vehicles will be scrapped, claiming it would have an “immediate positive effect on air quality”. But these commercial schemes come with a caveat, as according to industry experts, these sort of headline deals sometimes don’t offer the best value.
So do your homework. Though the car you’re parting with might have a few miles on the clock, have you checked its market worth? Many cars have a higher residual value than a dealer might indicate. You’ll always lose money on everyday cars, but some will fetch a better price than others. Though the allure of a shiny new motor is tempting, make sure you get the best deal possible for your banger. And remember you can haggle – a skill we seem to have forgotten.
But back to my opening point: is it about time the government re-introduced an industry-wide scrappage scheme? The double benefit of reducing emissions and a pre-Brexit boost to an important industry must be tempting.
So who pays? Well I’d suggest the weight of the cost should be footed by the manufacturers and traders, with the government again would be a facilitator. Last time taxpayers’ cash, which underpinned the offer, was quickly clawed back. For as sales of new cars picked up, the Treasury reclaimed most of the £150 million investment through increased VAT revenues. In other words, by the end of the scheme, it didn’t cost the government or the taxpayer a bean.
A new scheme would be a joint carbon reduction measure and ‘stimulator’. This might be the best way to move the consumer onto greener technology and make a meaningful change to emissions. It’s most certainly tempting…