Good News For the Motor Industry : The good news is that September sales are up in comparison to September of last year. This comes from a recent report that shows from the beginning of September when the new 09 plates became available and during the full month, approximately 368,000 vehicles were registerd with the ne ’59 number plate. According to the SMMT, which is the government’s vehicle scrapping scheme, the offerings have been extended and they have played a large part in the increased September sales. This doesn’t however mean that the conditions are not still a challenge in the retail auto marketplace. The beleaguered automobile retail indusstry welcomed the scheme, which has been pushed within the cabinet by Lord Mandelson, the business secretary. The introduction of a vehicle scrappage scheme boosted the new car market, and encouraged consumers step foot back into the new car showrooms, and as a result, reduced the likelihood of employee downsizing.,” Paul Everitt, chief executive of trade body the Society of Motor Manufacturers and Traders (SMMT), said: “This is very good news for car and light-vehicle buyers. It will kick-start demand in the market place.” The car industry needed to contribute £1,000 to the grant and the scheme was not restricted to greener vehicles.
The government had originally set aside three hundred million pounds to fund the scrappage scheme, when it was introduced earlier in the year. This release came on the heels of the successful plans put into use in other countries. The scheme basically provided owners of vehicles that were ten years old or older and who had retained ownership for twelve months or longer, up to two thousand pounds for turning over their vehicle for scrap. The money was provided specifically in order to fund a portion of the cost of a new vehicle. It was believed that this funding would hold out till approximately February of 2010, consumer interest and use of the scheme was much higher than was expected and concerns began to surface as to whether or not the funding would run out quite a bit earlier than originally anticipated. T
Motor : the government recently agreed to extend the scrappage scheme adding another one hundred million pounds to fund the project. This added amount is considered enough to be able to continue funding the project until at least February as it was originally planned. It is believed that because of this extension in funding, use of the scrappage scheme would remain high throughout the year and into the first part of next year. Part of the result of this is projected to be a boost to the economic recovery and the general strengthening of the economy. On the other hand, the AA warned that a ‘shock increase in fuel duty, which was also announced, would more than cover the scrappage scheme’s costs and was for all intents and purposes, giving with one hand while taking away with the other. It remains to be seen, what the full impact of the scrappage scheme will be on the auto industry, so far the numbers appear to be staying positive, however the economy is still stalled and only time will tell if this project will help to kick start it and get it moving in a forward direction again.