‘Bangers for Cash’ scheme now in force

‘Bangers for Cash’ scheme now in force

In a bid to boost the fall in demand for new cars, the UK’s car-scrappage scheme comes into force today.

The scheme, which pays consumers to get rid of their old cars and replace it with a more environmentally friendly car, has been successful in overseas, particularly in Germany who reported a 40% increase in new car sales for March.

The £300 million initiative, which was announced in last month’s budget, will give motorists £2,000 when they scrap their vehicle (which must be at least 10 years old). The Government will contribute £1,000, with the remaining £1,000 funded by car firms.

Although the scheme is voluntary, almost 40 car manufacturers are participating, which covers all the major brands.

The scheme has received a mixed response with car manufacturers hoping the Government would provide the entire £2,000 funding.

Commenting on the scheme, Business Secretary Peter Mandelson, said: “The scheme is a wonderful bargain and it 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.”

Paul Everitt, chief executive of the Society of Motor Manufacturers and Traders told Sky News: “There has been a good response to the scheme ahead of the official start date and industry is confident that this will be translated into additional orders.”

The scheme will run until the end of February next year or until the Government funding runs out.

Approximately 12 million people are employed in the European car industry, with around 800,000 workers in the UK.

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