SCRAP: SMMT responds
April 27th, 2009 by Richard Aucock
CAR Dealer Magazine has a response to our scrap questions – and some positive news – from the SMMT.
‘There is a meeting this afternoon which we will use to address issues which have been raised over the last few days by our members,’ revealed a spokeswoman.
These are ‘primarily around the exact processes which will be undertaken and how the scheme will work.’
So, it seems that in the NEXT FEW HOURS, we could be getting the much-needed clarification we so despeartely needs.
This really is a developing news story, so be sure to come back throughout the day!
• Do cars actually need an MOT, as suggested by the press briefing? Or, indeed, to be road legal at all?
The initial information we had from BERR said that the scheme will be open to vehicles over 10 years old which have been owned for at least one year and have tax, MOT and insurance. It does specifically say that a current MOT certificate would be required.
• Is it a maximum £1000, or can it be a percentage of this?
As far as we are aware, it will be a minimum £2000 (made up of £1000 from government and £1000 from manufacturers) unless a manufacturer wanted to add an additional incentive on to certain vehicles.
• Do car makers have to offer it on ALL cars, or can they choose selected ones?
A manufacturer that signs up is likely to have to include all models.
• Can it supplement other sales incentives already in place?
The minimum offered will be £2000 – a manufacturer will be able to add additional incentives.
• What about car makers raising list prices?
Some manufacturers have been forced to increase the list price of some vehicles as cost-bases have risen as a result of the strong Euro against sterling. This is likely to affect any product built in Euros and sold in sterling, not just car manufacturers.
In real terms, there has never been a better time to buy a car as more equipment has been added as standard while the price has remained relatively stable.
• Why is Government not offering the full £2000?
SMMT’s proposal had included a £2000 Government incentive. We had pushed for the best possible deal for the industry but ultimately, it is great news for consumers that a scrappage incentive scheme has been adopted and industry is now determined to make it a success.
• Why is there no low-CO2 element to the new cars purchased?
SMMT’s original proposal had cautioned against linking the scheme to CO2 emissions. There is already a proven tax regime that guides people towards lower-emitting vehicles and it is important that to ensure maximum impact, the scheme is as simple as possible for the consumer.
In addition, a new vehicle is likely to emit on average 14 percent less CO2 than a pre-1999 model and be at least Euro 4 standard compared to Euro 2 or less in 1999.
Evidence from across Europe also points to the fact that the majority of people taking advantage of the scheme will be buying cars at the cheaper, and therefore smaller, end of the market, so the CO2 savings are likely to be considerably more.
BUDGET: Reaction to scrap scheme
Tags: Budget, new car scrap, scrappage, SMMT
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