Scrappage scheme launched today to benefit poorer drivers, says AA

The vehicle scrappage scheme which starts today will not only pump an extra £2 billion turnover into the UK’s ailing car sector but give the country’s most disadvantaged and unprotected drivers a lift, fresh AA research reveals.

An AA/Populus panel survey of nearly 15,000 AA members last week found that younger and lower-income drivers are most likely to take up the offer.

Asked if they had definitely decided or considered buying a new car under the scheme, 20% of 18-24 year olds said they would take advantage of the government programme. This compares to 11% of drivers overall, with women more interested than men at 13%.

The 1% of respondents (equivalent to 300,000 drivers) who say they will ‘definitely’ scrap and buy new doubles among the group that includes semi or unskilled workers and pensioners. Even if 1% of motorists take up the scrappage scheme offer, the £300 million set aside by the Treasury will be over-subscribed.

53% of respondents did not qualify for the scheme as they did not have a car ten years old or older.

Motorists will be allowed to choose from the 38 manufacturers taking part in the scheme covering all the major brands, including Allied Vehicles, Bentley, BMW, Chevrolet, Citroen, Daihatsu, FIAT, Ford, Honda, Hyundai, Isuzu, Jaguar, Kia, Land Rover, London Taxis International, Mazda, Mercedes Benz, MG Motor, Mitsubishi, Nissan, Perodua, Peugeot, Porsche, Proton, Renault, Rolls Royce, SAAB, SECMA UK, Subaru, Suzuki, Toyota, Vauxhall, Volkswagen, Volvo, Koelliker UK Ltd, Iveco Ltd, Chrysler, Renault Trucks UK Ltd.

Visiting a car dealership Business Secretary Peter Mandelson said: “I am delighted by the response of the motor industry. Thirty-eight companies have signed up - all the major UK car manufacturers and a number of other companies. This means more choice for consumers and a boost for British brands.

“The scheme has been met with a flood of enquiries from customers. It will provide a boost to the industry and kick-start sales.”

The £2,000 grant is made up of £1,000 from government with matched funding from vehicle manufacturers. The scheme will operate until March 2010 or until the government funding has been exhausted.

Edmund King, AA President said: “In one go, the scheme will transform the chances of survival in a crash for thousands of car owners whose current old cars would only have two-star crash test protection under Euro NCAP compared to the average four or five-star protection of newer models. Younger drivers, carrying several passengers, in older cars, are most at risk on the roads and seem most keen to participate in the scrappage scheme.

“This scheme has the potential to bring brand new car ownership to some of the UK’s most disadvantaged drivers for the first time. In effect the £2000 incentive can act us a deposit against loans for many less-well–off drivers.”

But not all motoring groups are as enthusiastic about the scheme.

Ultra-light vehicle manufacturer and importer Aixam Mega says the trade-in plan discriminates against some motorists and works against the government’s own plans to encourage the use of electric vehicles.

Following meetings at the Department for Transport, Aixam Mega has been informed that ultra-light vehicles – including those with electric, petrol or diesel-powered engines – will not be eligible for a £2000 discount under the scrappage programme.

Lawrence Holland, general manager of Aixam Mega, said: “The government is missing a big opportunity to put more electric vehicles onto the roads of UK towns and cities.

“The only electric vehicles currently available to most motorists have been specifically excluded from the scrappage scheme.

“In addition, the UK still has a significant number of older motorists who do not hold licences to drive traditional cars, and who are therefore still driving old polluting and worn-out three wheelers.

“Parts are no longer available for these, with the result that they are becoming less and less reliable, and less safe.

“In addition to its electric vehicle range, Aixam Mega produces petrol and diesel-powered ultra-light vehicles that three-wheeler drivers can trade up to, improving their own safety and reducing their vehicle emissions.

“A re-think on its scrappage scheme policy would help the government to get more potentially unsafe and polluting vehicles off the road, and also boost its plans to increase electric vehicle use.”

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