Yes, we’ve had lots of misgivings about the Scrappage Scheme in the UK. And most of those remain. But it is proving to be a boost to beleaguered car dealers and manufacturers as people stream in to showrooms to take advantage of the headline £2,000 discount.
Ford – who are the biggest car seller in the UK anyway – are, not surprisingly, coming out on top in the Scrappage wars. They’ve managed to shift over 14,000 cars under the Scrappage Scheme in the last few months, and orders are coming in at the rate of 300 a day.
Top seller is the new Ford Fiesta, with a healthy dose of Fiesta sales being the Ford Fiesta ECOnetic. Not surprisingly, as it’s the most economical Fiesta there is , and a decent drive to boot.
But it’s not just Ford doing well. Probably the most successful – in terms of percentage increases – is Hyundai, who have taken the fight for Scrappage sales to the public with some very strong PR. They did a great job in Germany, they’ve done it here and now Hyundai are doing very well in the US with Cash for Clunkers – offering the CARS deals ahead of the pack.
So good new – at least short term. And it is undoubtedly true that getting older cars off the road also helps with safety and undoubtedly saves lives. But the problems to come are two-fold.
At this rate of sales the Scrappage Scheme will run out of funding by the Autumn, which will mean sales dry up again. Car makers could take it on the chin and cover the whole £2k themselves in the hope of sales continuing, but there is a finite number of people who hadn’t previously considered buying a new car, but have done because of ths Scrappage Scheme. When those dry up – as they must – we could see car makers in worse trouble than before unless – by some miracle – the economy returns to normal before then.
But don’t hold your breath.