Since the government introduced the scrappage scheme in May 2009, nearly 400,000 people bought cars using it. According to the DVLA, new cars registered under the scrappage scheme accounted for more than 18% of sales for the 12 month period. “The scheme helped support our economy and played a vital role in providing a much-needed boost to the UK automotive industry,” said SMMT chief executive, Paul Everitt. The market for 2010 is predicted to perform well but will not achieve the peaks experienced during the scheme.
Analysis of the scheme show that cars registered under the scrappage have average CO2 emissions 27% lower than the cars they replaced and nearly 10% lower than all other cars registered in that period. Many argue that the lower emissions created by the new cars does not offset the emissions produced during their manufacture. But those same critics also admit that while the scrappage has allowed the auto industry to find its feet again, it has also given them chance to get on track to a greener future. All of the manufacturers are now producing serious commercially viable hybrid alternatives to regular petrol or diesel engines and the development of electric cars is fully under way.
One of the major arguments of the scheme is that many consumers were persuaded to buy a new car based on the discount they would receive, even if their existing car was perfectly fine and the 2000 offered an “unnecessary incentive.” Considering the fact that a car needed a valid MOT and to drive to the garage under its own power to be eligible for the scheme, it suggests that many decent cars would have been wasted.
The scrappage scheme has created a dilemma, either save the auto industry and the hundreds of thousands of Jobs it provides or stay green and stop building new cars. Most of the emissions produced by a car occur in its manufacture so by building all these new cars, the idea of creating lower emissions are completely discredited.
The auto industry is now faced with a new problem; they have become reliant on the revenue the scheme generated even though they knew it was scheduled to end at some point. Now they are again faced with low sales and most of them are falling back into the red with the prospect of job losses and closures once again on the horizon.