Impact of scrappage scheme 'yet to be seen'

Jun 4 2009 The impact of the government's scrappage scheme for used cars has yet to have a significant impact on the new car market, it has been claimed.

According to figures from the Society of Motor Manufacturers and Traders (SMMT), there has been little upturn in sales of new cars since the initiative was launched, but experts are predicting that things will change over the coming months.

"The vehicle scrappage scheme introduced last month should have a significant impact on car sales as we go forward, but it is still too soon to see its true effect," said Sue Robinson, director of the RMI National Franchised Dealers Association.

While the new car market remains sluggish even with the scrappage scheme in place, the used car sector continues to do well.

Recent figures have suggested the used car market will continue to see growth in average prices over the course of this year after some dramatic falls in the final months of 2008.

Chancellor Alistair Darling introduced the scrappage scheme in a bid to boost the sales of new cars in the UK.

The initiative offers drivers of old cars up to £2,000 off a newer, more environmentally-friendly model if they are willing to trade in their existing vehicle for scrap.

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