Uk Car Scrappage Scheme Was One Of Most Successful

A new report which examines how the British car industry can build a sustainable

future has concluded that the Government vehicle scrappage schemes positive effect on sales should not be at the expense of future performance.

The report, compiled from findings gathered from amongst the car-makers following the end of the scrappage scheme, concluded that the vast majority of people who bought a new car under the scheme would have been unlikely to do so otherwise, and would probably have bought a used car when they decided it was time to swap their vehicle.

This contrasts with the findings following the ending of the German equivalent of scrappage, which suggested that up to 30 per cent of the 700,000 people who traded in their more than 10-year-old car or van would have replaced them during the following year in any case what the motor trade has called pull forward.

The study, which was put together by Glasss Automotive, a leading observer of the car sales market in the UK, puts the effect of the scrappage scheme into context alongside the troubles which had been experienced by the British vehicle market in all of the previous two years.

It concluded that the scrappage scheme did a good job in getting would-be buyers to visit their local car showrooms, which then resulted in increased new car sales. This helped contribute to new car sales for 2009 reaching 1.99 million, a figure which Glasss estimates would have been around 1.78 million without the incentives offered under the scrappage scheme.

But since the scrappage scheme ended, demand from British buyers for new cars has again fallen dramatically, Glasss found.

This points to a long, hard recovery for the new car market, it adds, and believes that used car sales will be similarly sluggish. This is because used car sellers no longer have an incentive to trade in earlier than they would otherwise have done.

But none of these considerations have affected the market in quality, nearly new cars, where customers are as keen as ever to get a good deal, in the knowledge that they can get a car which will remain reliable for a long time to come.

This is because, with increased sophistication of their vehicles, manufacturers are offering excellent warranties which can be transferred to a new owner, along with considerable benefits which bring medium and long-term peace of mind such as membership of one of the major motoring emergency organisations.

Relaxation of rules governing car servicing and maintenance under warranty has also helped give potential buyers more confidence that they can continue to maintain their new or used car within their budget. Manufacturers can no longer insist that routine servicing is carried out at one of their own franchised dealers for a warranty to be valid.

by: Kevin Longworth

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