18 May 2009
Scottish motorists and the car industry will both benefit from the UK Government's car scrappage scheme which goes live today
The initiative offers consumers a £2,000 discount towards a brand new car or van when they trade in a 10-year-old vehicle.
It will run until 28 Feb 2010 or until the £300 million of Government funding across the UK is used up. The industry was asked to provide like-for-like funding which means the £2,000 is made up of £1,000 from the Government and £1,000 from manufacturers.
The targeted and time-limited scheme, which was announced in the Budget, is designed to support up to 30,000 new car and van sales across Scotland and 300,000 across the UK as a whole.
It is likely to be worth around £60m to motorists and the vehicle sales sector in Scotland and comes at a time when the motor trade is under significant pressure.
The Secretary of State for Scotland Jim Murphy welcomed the scrappage scheme. He said:
"The scheme is good news for Scottish motorists and for the Scottish motor trade. It will help boost the market by kickstarting demand for new cars and already there are signs that there will be a significant take-up of the discounts. It's a good way for motorists to get a bargain and to support jobs across the motor sales and manufacturing sectors.
"The UK Government is determined the motor industry will remain a very important part of our manufacturing base. It is a major investor in research and development, supports highly skilled workers and a wide supply chain. These are vital to our future manufacturing and economic success."
Recent figures from the Scottish Motor Trade Association show new car registrations fell by 18.5% (11,421 units) between April 2008 and April 2009, with a UK-wide decrease of 24% (133,475 units). UK car production was down 56 per cent in the first quarter of 2009, compared with first quarter 2008.
The motor retail sector employs 552,000 people across the UK, and there are 180,000 jobs in motor manufacturing.