Scrappage scheme just announced

[obi_waynne]

In the budget they have just (12:52pm) announced a car scrappage scheme where cars over 10 years old may be traded in for a £2000 credit on the new car. This will run till march of next year. It worked quite well in Germany.

It is a good time to buy new if you have the money. Will this put the price of bangers up as people snap them up to get a £2000 credit?

Will this affect the used car market? Is this a good thing or bad news for anyone in the used car market?

 

[HDi fun]

I can't see the point of this all. What's the thinking behind this?

 

[Miniman]

So we can buy a real cheap car and then scrap it for 2 grand towards a new car?.

 

[Munday]

This is total bull#!#!#!#!, i love older cars and dont want to see them all scrapped in favour of newer cars (where the production of new cars releases much more CO2 than running an older car)

Arrrgh it makes me want to scream!

 

[HDi fun]

I'm glad someone made that point ie. a making a new car creates tons of CO2. And it also means the old one has to go into landfill.

 

[dpsubaru]

Thre reason they do this is to stipulate demand in the car industry (as successfully demonstrated in Germany) and it is supposedly more green - this is a false economy, 1) as HDI says, the new one has to be produced and 2) this just means that after the end of the program car sales will slump again.
The added advantage to the govt (while they are in office) is purchasing of new cars will increase VAT returns in the short run.

 

[dpsubaru]

one other point, that they havent addressed: you need credit or available cash to be able to do this, both are in short supply so unless they insist the banks make credit easily available this could have trouble taking off.