peter mandelson
Business secretary Peter Mandelson said that the car scrappage scheme would be extended to cover 100,000 more vehicles, but will still end in February 2010 as per the current agreement.
The £300 million scheme was launched in May and has so far seen 227,750 vehicles scrapped for new car orders, costing the government and the manufacturer £1,000 each on each transaction.
The government figure will now be raised to £400 million and will end either in February or when the fund runs dry, whichever comes first.
Mandelson said: “There are encouraging signs that the economy is picking up. But recovery remains fragile and uncertain, especially in manufacturing and one of its cornerstones, the car industry. This is not a blank cheque to the auto manufacturers but recognition that there is still a short term challenge to boost demand and confidence in the sector.”
Paul Everitt of the Society for Motor Manufacturers and Traders said the decision was an “extremely important decision that will inspire consumer and business confidence”.
The scheme has recently come in for criticism as only one in three vehicles purchased through it, are built in the UK, while other European countries are reaping the rewards from the government hand out.
1 comment so far
1 Matt // Oct 5, 2009 at 2:50 pm
I still can’t see why this is going to help the mainstream UK Motor industry (what’s left of it), in the long term?