The government has announced that funding for its popular vehicle scrappage scheme will be increased by £100 million, allowing the scheme to potentially discount a further 100,000 vehicle orders.
So far 227,750 orders have been placed through the scheme. The increased funding enables the scheme to fund a further 100,000 vehicles, bringing total budget to £400 million and covering up to 400,000 vehicles in total. The extension continues as a partnership between Government and manufacturers, with matched funding providing the £2,000 discount for each scrappage order.
Alongside the increased funding the Government is working with manufacturers to increase the benefits to businesses, with plans to extend the scheme to van owners with vehicles over 8 years old rather than the current 10 year requirement. Car owners will also get a boost, with the age qualification changed by 6 months to extend the benefits to cars registered on or before 29 Feb 2000 (V registration). These changes will come into effect as soon as possible, and as originally planned the scheme will come to an end in February 2010 or when the funding runs out, whichever is sooner.
The scrappage scheme has boosted consumer demand and industry figures have reflected the positive impacts of the scheme both within and beyond the automotive sector, with manufacturing benefitting the whole supply chain, from plastics and steel, to individual component manufacturers all receiving a boost.
Lord Mandelson, Secretary of State for Business, Innovation & Skills, said:
“The sector has been strongly affected by the recession, but the scrappage scheme has delivered a boost to manufacturers and the supply chain. We have listened to the concerns of manufacturers and are increasing the funding of the scheme to £400m.
“But we must make sure that the help we do offer is targeted, limited and proportionate. This is not a blank cheque to the auto manufacturers but recognition that there is still a short term challenge to boost demand and confidence in the sector.”
Posted under General Interest on 5 October 2009