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Government Rules Out Scrappage Scheme

The Government has confirmed there are "no current plans" for a new scrappage scheme that would encourage people to trade older, more polluting cars in for new electric ones.

‘Scrappage’ schemes were introduced in 2009 to encourage new car sales after the financial crisis of the previous year. A £2,000 incentive was provided by the Government to buyers who traded in old cars for less-polluting, newer models. The stimulus package resulted in an increase in car sales, with the effect of increasing the proportion of more modern, less polluting cars on the road.

In recent years, car manufacturers have faced increased pressure from consumers, the government and environmental lobby groups to assist in reducing car exhaust emissions, with the UK government announcing that the sale of non-hybrid petrol and diesel cars would be banned entirely by 2035.

Fast-forward a decade and owners of some of the new cars registered during the 2009 scrappage scheme might now be tempted to scrap those as well. Incentives are offered by some manufacturers and reports suggested that the government was thinking about a £6,000 incentive scheme to get more people into electric cars. This has been officially ruled out — likely because of how much it would cost to implement. Another possible explanation is that public appetite for spending in this area is unlikely, given the extent of the economic difficulties post-Covid Britain is facing.

The government say that it remains committed to a zero-emission future and points to the fact that it has already invested £2.5bn in electric vehicles and infrastructure, including the £3,000 plug-in car grant (PiCG) scheme.

Motor manufacturers and dealerships welcome the Government’s investment in bringing new Ultra Low Emission Vehicles to market but are aware the current crisis risks slowing down this transition. Further Government support that encourages the sale of new vehicles would be welcomed by the industry.

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2nd of July 2020