“Scrappage has not harmed aftermarket,” says VBRA chief

21% of Mitsubishi's new car orders in May were made using the scrappage scheme
21% of Mitsubishi's new car orders in May were made using the scrappage scheme

The Government’s scrappage incentive scheme has not had a negative impact on the aftermarket.

This is the belief of Malcolm Tagg, director general of the VBRA, who applauded the initiative’s stimulus effect on the new car market.

More than 200k new cars have been ordered under the scheme since it was launched in May 2009.

“I believe the Government have got things right,” he said.

“It might have been expected that opening the taps at the head of the process by which vehicles are brought onto the roads would rub off in some way with repairers and in other aftermarket sectors.

“This is an expectation based on the supposition that older cars generate more work for repairers and others but it is in fact not totally the case.”

Tagg said that because damaged older vehicles are usually third party insured and of low value, they tend to be written-off rather than being repaired.

“Overall we must view the scrappage scheme as a useful initiative that has brought benefits to the main vehicle manufacturers,” he added.

“The scheme itself… has not provided any benefits to the repair market although it has not harmed it in any way either, the net impact being neutral.”

The news comes after CAT sister publication WhatCar? called for an extension to the scrappage scheme.

The magazine said that this would allow car buyers to offset a 9.5% hike in new car prices and the likelihood of an additional 2.5% increase when the Government, as it is expected to do, restores VAT to its 17.5% standard rate in the New Year.

Steve Fowler, WhatCar? editor, said that extending the financial incentive to buy a new car “will help to boost the UK economy and speed our exit from recession”.

What do you think? Has your business been affected by the scheme? Is it a good idea to extend it? Have your say using the comment facility below.

Published by emmabutcher

Emma has been CAT's editor since January 2008. There isn't much she doesn't know about the aftermarket - and her favourite topic is definitely BER!

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1 Comment

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  1. Scrappage may have worked for some people, but friends of mine cannot afford new cars, even on the scrappage scheme. They are making do with their current cars, which is obviously great for the aftermarket.
    We need older cars on the road – it’s the only way new drivers and those on lower incomes can afford to be mobile.