Scrappage Quotas as Scheme Approaches End

It has been revealed that more than three quarters of the £400m budget has been used up for the Government Scrappage Scheme.  There is only funding for less than 82,000 new vehicle orders left for buyers to take advantage of under the scheme.

As the scheme enters its final throes, the Department for Business will allocate order quotas to motor manufacturers, which will ensure a smooth closing of the highly successful scheme and will be based on brand popularity.  However, it hasn’t yet been decided whether the quotas will be allocated by overall market share, or market share of scrappage sales.

A spokesperson for BIS said: “The figures have yet to be determined.” The scheme ends on February 28, so there is not much time left to decide.

If the quotas go to those brands with the greatest overall market share, it will upset smaller manufacturers who have done well under the scrappage scheme. ‘We will go ballistic if that happens,’ said one such car maker.

Business secretary Lord Mandelson said: ‘I am pleased to see that the scheme has been taken up by so many people, supporting our automotive manufacturers through a very difficult time.

‘With limited orders as we near the close of scrappage there is a risk of disappointment for car buyers. I would urge people who are still keen on taking part to put their orders in as soon as possible, as time is running out.’

Lord Mandelson also said he expected the ‘impact’ of the scheme to continue into 2010 after the incentive closes.

New figures showed that by yesterday 318,628 new vehicle orders were taken through the scrappage scheme, under which buyers receive a £2,000 grant for trading in an old car for a new model.

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