Scrappage – more ups than downs

The scrappage scheme has probably taken up more space and time in blogs and column inches in newspapers this year than virtually any other motor trade related subject (and here are a few more paragraphs to add to the pile). The scheme itself can now certainly be classified as a success and it’s true to say that for car makers who cater for the less expensive end of the market, it has positively energised them.

Of course there are some dealers who have probably not sold a single car on scrappage and therefore it has had absolutely no effect on sales whatsoever, but what it has definitely achieved is the generation of massive publicity and created a positive marketing campaign. This has, simply speaking, enabled car dealers to engage with customers and those with creative flair have managed to offer their own in built scrappage system to sell more cars.

Enquiry rates have been high all year and even those buyers, who have not yet actually bought a new car, have ventured into a showroom for perhaps the first time in many years meaning they may go back sooner rather than later.

So the ultimate 400,000 plus scrappage sales and all the goodwill generated leads us to conclude that although the new car market without scrappage is still well down year on year, there has been overall a positive effect for almost everyone involved. The biggest criticism we have heard, of all the scrappage schemes in operation across the world, is that ultimately they just bring forward sales and so lead to an even sharper decline once the scheme eventually concludes. The fact that the scheme has been extended may be as much down to fears of this widely predicted drop off in sales as to its perceived success.

Perhaps the only losers are those smaller dealers who traditionally deal in scrappage type cars and buyers who really can only afford – or want to spend – perhaps a few hundred Pounds. There have been many cars which have probably since been crushed that were low mileage, good examples which could have been a good starter car, run-around or second car.

As with most initiatives such as this, if you look hard enough, there will always be people who potentially lose out. It’s really in that position that I find myself right now as I am about to buy my son his first car and can’t find anything suitable anywhere for a limited budget. I guess I’m the ying to the scrappage schemes yang. Oh well.

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