UK old car scrappage scheme

The UK Government has adopted a £2000 old car scrappage scheme aimed at getting new car sales moving again and removing older, 'high-polluting' cars from the UK's roads but it isn't straightforward or ideal for a first-time buyer. Many experts are also questioning the actual 'green' benefit of the scheme. The scrappage scheme was extended to cover a maximum of 400,000 new vehicles and then extended again to run to the end of March 2010.

The basics of the scheme are that if you trade in an old car, then you'll get £2000 off the price of a new one. In reality it's a lot more complicated than that....

You have to have owned the car for more than 12 months.
The car has to have an current MOT
It must have been first registered in the UK on or before 29th March 2000 (V-registration or earlier)
The scheme is voluntary for the manufacturers but most have sign-up including Citroen (obviously), Ford, Fiat, BMW & Mini, Honda, Toyota, Renault, Nissan, Hyundai, Vauxhall and Volvo

Which effectively rules out first-time buyers - unless of course somebody in your family has a car that qualifies and the new car is registered in their name. If you do this, ensure that your motor insurance covers all the drivers correctly.

The funding for the scheme is split beween the UK Government and the car manufacturers - which was a bit of surprise to the latter as this is different to other European schemes. The net effect is that discounts have disappeared from cheap, low-margin models as customers will be getting £1000 off anyway. On more expensive cars the discount are currently bigger anyway and so their are still discounts available on top off the scrappage discount. The scheme is funded to cover 400,000 new vehicles being sold - increased from 300,000. The scheme was due to end at the end of February 2010 but has just been extended to run to the end of March 2010 as the 400,000 vehicle ceiling has not been reached.

Similar schemes have been running in Europe for several months and these have 'hoovered up' many of the smaller cheaper cars which means that unless the car you fancy is already in stock or on order, you might have a long wait for it. Their are rumours that the scheme may be limited to cars with a delivery time of less than 12 weeks to help shift built stock but this has not been confirmed.

The overall result for first-time buyers is difficult to call until the scheme get moving but even if you do not have an old car to trade in you should still be able to get a discount - dealers may be more interested in you for the lack of hassle. The big downside is the likely reduction in availablity of ideal first cars.....

Green Benefits

One of the aims of the scheme is to remove 'polluting bangers' from our roads and if you look at just the CO2 output, then you might be convinced. Older vehicles will be in the range 160g/km and above and new, small cars are generally in the range 140g/km and below. If you take into account the number of vehicles being replaced the overall effect will be in the region of a 2% overall reduction in passenger car CO2 output.

You have to take into account the energy used to produce these 'still running' cars in the first place, which is reckoned to be about 15% of the total energy used in the vehicle's whole life. So there is an argument to support buying only vehicles in stock, and not just building lots of new ones, but this would only reward those manufacturers that have overproduced. Due to the amount of energy required to build a car, the new car only starts to be a benefit on overall CO2 output after 8 years of use.

Safety

There's no doubt that new cars are safer than those over 10 years old. Not only have new technologies like airbags and ABS become more widely available but vehicle's crash structures have improved dramatically.

This sceme won't necessarily remove 'unsafe' cars from the road as the trade-in has to have a vaild MOT certificate but a lot can happen in 12 months to cars that are not looked after properly.

When Scrappage ends...

With the scheme due to end, several manufacturers including Toyota and Vauxhall have announced 'swappage' schemes to allow you to trade in your old car and recieve a set discount off their list price. This just saves you the haggling but it might still be worth doing it as you still might get a better deal, especially if your trade-in car is half-decent. The rules about age of vehicle and how long you've owned it are likely to be different from the Government scheme.

< back to what’s right 4 u