Car Scrappage Scheme has no effect on UK car sales
The Government’s new £300m car scrappage scheme is yet to have any affect on the market after new car sales figures have been released that showed a 24% drop in new car sales.
The Government’s scrappage scheme provides the consumer with £2000 towards a new model car when they scrap their old car if it’s older than 10 years old. These scheme launched in May and strated hitting road bumps from stage one. There were arguements over costs which lead to Ford holding off on their involvement.
Yet another month of low car sales means that the UK has now seen a steady decrease in car sales over the last 12 months. There has been news that consumer confidence is recovering slightly, however, with these new sales figures, it simply weakens that idea.
Details released from The Society of Motor Manufacturers and Traders revealed that 35,000 new cars had been ordered through the car scrappage scheme, however, they say that it will take time for this figure to change into new registrations. They also used the excuse that a huge number of consumers are looking around to try and get the best offer before buying a new car, this could just be a way of giving the scheme some extra time to prove that it wasn’t a complete waste of money.
134,858 new cars were sold last month in the UK with the Ford Fiesta proving to be the most popular new car. Vauxhall counted for 15,386 of those sales, however, they have suffered from a 40% drop in sales.
A major reason for the slump in sales to due to corporate sales of new cars. Car leasing companies that offer a range of makes, such as Vauxhall leasing and BMW leasing, are reducing the amount of cars they are buying because they are also suffering from the economic crash.
A number of leasing companies are losing sales because consumers are forgetting about the leasing options which tend to be cheaper than buying a new car. Plus with the introduction of the car scrappage scheme, consumers are encouraged to buy a new car rather than consider other options.
