SMMT News UK Manufacturing

Consumers back industry call for a scrappage incentive scheme

16 March 2009 #SMMT News #UK Manufacturing


Results from an independent consumer survey commissioned by the Society of Motor Manufacturers and Traders (SMMT) show that 76% of consumers are in favour of the UK government introducing a scrappage incentive scheme similar to those currently running across Europe.


The proposed scheme could see drivers of cars over nine years old offered a £2,000 incentive towards a new or nearly new car in return for scrapping their existing one1. A similar scheme already operating in Germany has successfully boosted the new car market, increasing registrations by 21.5% in February – the first year-on-year monthly rise since July 2008.


The survey, undertaken by MM-Eye, a market research company specialising in automotive research, showed that 61% of people said they were likely to take up the offer and 66% of people agreed with the idea of taking older cars off the road and replacing them with newer ones because of the positive environmental impact.


An average new car emits 14.6% less CO2 than a nine year old model so the scrappage scheme would continue the trend in reducing car emissions. The survey backed this further, showing that people likely to take up the offer would be buying cars at the smaller end of the market, with the lowest CO2 emissions. 88% of those likely to take up the offer said they’d spend up to £10,000 on a new car in addition to the £2,000 incentive. According to JATO Dynamics, the world’s leading provider of automotive data and intelligence, nearly a third of cars newly registered in 2008 fell into this category2 and is the typical cost of a supermini model, which in 2008 emitted 137.7g/km, 12.8% below the national average and over 25% below the 1999 market average.


Commenting on the survey, SMMT chief executive Paul Everitt said; “The scrappage incentive scheme is a popular way for government to support the automotive industry and provides good value for money for the tax payer. The increased VAT revenue to government largely offsets the cost of the scheme, yet the positive impact it could have on building consumer confidence and boosting the new vehicle market are extremely valuable to the UK automotive sector and the 800,000 people that work within it”.


To view a video report please follow this link


Scrappage incentive schemes currently operating across Europe:






Boost to market


Over 13 years old 

€1,500 to purchase a new car with Euro 4 as minimum engine specification.

e 30,000


Over ten years old

€1,000-2,000 to purchase a new car which is less than 160 g/km or an LCV.



Over nine years old

€2,500 to purchase a car up to 12 months old with Euro 4 as minimum engine specification. 



No age limit

€400-800 to scrap vehicle plus €1,500-3,400 if purchase a new vehicle.

e 20,000


More than ten years old

€1,500 to purchase a car which is at least Euro 4 engine specification and emits less than 140g/km for petrol and 130 g/km for diesel.



More than ten years old

€1,000-1,250 for a car which emits less than 140 g/km.

e 20,000


Over ten years old

€1,000 to purchase a car.



Over ten years old or 250,000 km

Up to €10,000 0% loan to purchase a new car or LCV. The car must cost less than €30,000 and emit less than 140 g/km. The LCV must emit less than 160 g/km.

e 100,000

Why is the automotive sector important to the UK economy?

·         27 car and CV manufacturers operating in the UK

·         1.75 million cars and commercial vehicles produced each year

·         £51 billion turnover

·         £9.5 billion value added

·         Over 800,000 UK jobs

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