Motor Trade - Scrappage Scheme

The Vehicle Discount (Car Scrappage) Scheme.

This is a Government sponsored scheme brought about in an attempt to boost the ailing motor trade industry. Under the scheme the Government provide £1,000 towards the cost of a new vehicle, in exchange the customer must trade in a vehicle at least 10 years old and meet certain other conditions, the dealer will be expected to meet the Government\'s £1,000 contribution to reduce the cost of the new vehicle by £2,000. The scheme is voluntary for motor dealers and will run from mid May 2009 to March 2010, depending upon whether its fixed budget runs out sooner.

There are certain criteria to be met by both the old and the new vehicles in order to qualify for the scheme.

The vehicle you are trading must ;

Be a car or small van up to 3,500 kgs.

Be registered in the UK on or before August 31 1999.

Be registered with the Driver and Vehicle Licensing Agency (DVLA) or Driver and Vehicle Agency in your name.

Have been registered to you continuously for 12 calendar months before the order date of the new vehicle.

Have a UK address on the registration certificate (V5C).

Have a current MOT test certificate before the date of order for the new vehicle(or within 14 days of expiry at the date of order).

Have a current tax disc when the order for the new vehicle is placed (or within 14 days of expiry at the date of order).

Be Insured when the order for the new vehicle is placed.

The new vehicle must be;

A car or small van weighing up to 3,500 kgs.

First registered in the UK on or after mid May 2009.

Declared new at first registration in the UK with no former keepers.

When trading in your old vehicle for a new vehicle, the registered keepers for both vehicles must be the same.

Reception of the scheme by the Motor trade industry was underwhelming ,they had lobbied for a subsidy of £2,000 rather than £1,000 pointing out that a similar scheme run by the German government gave a bigger subsidy and was extended to include cars up to 1 year old. Critics also stated that existing incentive schemes provided greater discounts. Early indications show that new car sales are down by 27.9% on last year which relates to nearly 290,000 fewer new cars. However Paul Everitt for the Society of Motor Manufacturers and Traders (SMMT) stated that early signs since the Car Scappage scheme was started were encouraging with 35,000 new cars being ordered from the inception of the scheme on May 18th 2009 up to June 4th 2009 .