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2000 to scrap your old car but no incentive to buy green

£2,000 to scrap your old car for a new one

Today’s Budget introduced a scrappage incentive scheme to offer motorists £2000 to trade in their old car (or van) for a new one. However the £2000 can be used for any new car, regardless of its emissions.

This move is designed to breathe some life into sales of new cars in the UK, and the government was obviously under some pressure to include all new cars. However the scheme could also have been used to encourage the government’s supposed push for lower emission vehicles, by only offering a financial incentive for vehicles that emit, for example, less than 160g/km CO2.

As it is, based on experience of a similar approach in Germany, the scheme will help to get some older cars off the road – and with new car emissions falling, this is likely to assist in giving us cleaner cars – just not at the rate that would have happened if the new car emissions were capped.

Details of Scrappage Incentive Scheme

There are quite a few ‘conditions’ of the new scheme. If you want to trade in your old vehicle:

• It must be at least 10 years old.
• It must be a passenger car or small van up to 3.5 tonnes
• It must have been first registered in the UK on or before 31 July 1999
• It must be currently registered with the DVLA to the registered keeper making the application, or currently on Statutory Off Road Notification (SORN)
• It must have a current MOT test certificate
• The registered keeper must have a UK address
• The registered keeper has to have been the registered keeper of the vehicle continuously for the preceding 12 calendar months before the order date of the new vehicle.

The new vehicle must be:

• A passenger car or small van up to 3.5 tonnes
• First registered in the UK or after the date the scrappage scheme is launched and declared new at first registration in the UK with no former keepers
• A UK specification vehicle
• Registered to the same registered keeper as the registered keeper of the eligible vehicle to be scrapped

The £2,000 grant is made up of £1,000 from government with matched funding from industry. The scheme will operate from mid-May until March 2010 or until the government funding has been used.

The scheme is a voluntary scheme so not all manufacturers or dealers may participate. It applies to commercial vans (up to 3.5 tonnes) as well as cars that are 10 years old or older.

If you want to apply, the dealers will do all the paperwork for motorists participating in the scheme and arrange for the old vehicle to be scrapped. The dealer will check that the vehicle being traded in and the new one being bought qualify under the scheme.

The scheme, with £300m from Government and matched funding from industry, is intended to provide immediate support on a short-term basis to boost the car industry and its supply chain in the wake of falling sales. It will also get older vehicles off the road and encourage consumers to invest in new, safer, and potentially more environmentally friendly models.

The scheme will be run by automotive manufacturers who wish to participate. It is expected to be operational from mid-May to allow industry time to prepare. There will be proper verification procedures to ensure the rules are followed, including audits by DVLA to avoid abuse that has been encountered in other countries.