SCRAP: Why it’s needed
April 7th, 2009 by Richard Aucock
THE Independent has today headlined a piece in its Business section, illustrating why scrappage is important.
Figures illustrated by the paper are stark:
• 4500 car dealers in the UK
• 600,000 people employed
• 25 percent of a car’s retail value goes to the car dealer network
The paper also suggests a subtle tweaking of the scheme to best stimulate demand – as discussed already within the Car Dealer Magazine forum.
Namely, to push people towards used cars, too. This is because of the ‘majority of movement taking place in the used car market,’ says The Independent.
A scrappage scheme that incentivised green nearly new cars would act as an escalator, pushing people up the chain into new cars.
Garel Rhys of the Cardiff Business School supports the scheme, says the paper.
‘As it is currently proposed, a scrappage scheme will help the dealers, the insurance companies and the credit providers…’
He did add a proviso, though: ‘It won’t help the UK car factories unless it recognises the fact that the link between the UK market and the UK industry is incredibly weak.’
This is why some experts, speculate the paper, are proposing any scheme will include a provision that new cars have to be produced in the UK, too.
Such a move would certainly prove controversial, particularly to makers of green cars which aren’t made in the UK – such as the best-selling Ford Fiesta diesel.
SCRAP SCHEME NOW: A call to arms
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Tags: independent, new car scrappage, scrap