Motor traders call for car scrappage scheme

By Douglas Fraser
Business and economy editor, Scotland

Car being scrappedImage source, Getty Images

The motor trade is calling for the UK to introduce a car scrappage scheme to help jump-start the economy and replace older, more polluting models.

It came as Scottish car dealers urged the Scottish government to follow England's lead and let showrooms reopen in the first phase of easing lockdown.

A £400m incentive was offered to car owners through a previous scrappage scheme which began in 2009.

It let them trade in old cars for scrap and buy new cars with lower emissions.

That helped manufacturers as well as the wider auto trade, and helped to reduce vehicle emissions.

Under that scheme the government gave £1,000 towards the cost of a new car, on condition that a car was taken off the road and scrapped. The trade-in car had to be at least 10 years old, and been owned by the customer for at least a year.

'Cash for clunkers'

Similar schemes were run in other EU nations. In the USA, the incentive was known as "cash for clunkers".

European motor trade organisations agreed earlier this month on a plan to lobby for similar scrappage schemes as economies emerge out of lockdown.

The French government has responded with a proposal this week for its own scheme.

The UK boss of Peugeot, Alison Jones, told the BBC's Newsnight programme earlier this month that there had been discussions with the UK government about a possible scrappage scheme.

The Scottish Motor Trade Association (SMTA) is part of the European network, and is now joining the call for such a scheme to be introduced in the UK.

Image source, Getty Images
Image caption,
Motor traders say a scrappage scheme would help to reduce vehicle emissions

SMTA chief executive Sandy Burgess has also written to Scottish ministers urging them to follow England's lead with an early reopening of car showrooms.

He said repair centres had operated safely through the lockdown period, and showrooms were ready to reopen with infection controls in place.

Mr Burgess said thousands of cars that were ordered before the lockdown still awaited collection, and he cited examples where Scottish buyers had gone south of the border to find dealers that were able to sell.

In England, customers have been able to buy online and collect from dealerships. That has not been allowed in Scotland, where handover has only been possible by delivery. That has been logistically difficult for dealers.

Writing to ministers this week, Mr Burgess said car showrooms could be safer than garden centres, which are expected to reopen soon.

"We urgently need some opportunity to save the new and used car markets and stimulate positive movement in a major part of the economy," he said.

"There is no doubt that this virus has taken its toll on many of our businesses to date and there will be many more before we are rid of it.

"Future damage can be minimised by having trust in the responsible actions of dealers."