CAR SCRAPPAGE SCHEME - WHAT IS IT?
The Government's newly announced Car scrappage scheme has been generally welcomed in the automotive industry as a good move to encourage greener cars, as well as provide a boost for car manufacturers who have been hit hard by the credit crunch.
The Car Scrappage Scheme is due to commence in May 2009, and will offer new car buyers a £2,000 grant when the purchase of a new car replaces an older, taxed, insured and MOT'd car or commercial van over 10 years old, which motorists have owned for at least 12 months.
Helping to save jobs
Commenting on the new Scrappage Scheme, the Business Minister Ian Pearson said "People will not only save hard-earned cash on buying a new car or a van for their business, but they will know they are helping save jobs too. If you've got a vehicle that's ten years old or more, you just need to talk to a participating dealer who will do the rest. You will get at least £2,000 towards a new one."
Who can apply?
There are currently almost ten million cars and just under one million vans in the UK which are eligible for the scheme. The scheme will be only offered to car buyers who want to replace their car or van which they have owned for at least a year. Owners wishing to take advantage of the scheme must have a current MOT test certificate, and must have a UK address on the V5C registration certificate. In addition, the new vehicle must be either a new car or a small van weighing up to a maximum of 3,500kg.
In his Budget statement to the House of Commons, Alistair Darling, the Chancellor of the Exchequer announced the scheme, offered as a cash-for-scrap scheme for vehicles over 10 years old. The £2,000 will come from two sources, the relevant car manufacturer contributing £1,000 and the Government forking out for the other half.
The Government has said that participation in the scheme is not obligatory, and manufacturers can opt out should they wish.
The Car Scrappage Scheme, due to be audited by the Driver and Vehicle Licensing Agency (DVLA) will run from the beginning of May to the start of March 2010, or until all available funds set aside by the Government has been used up.
Who's participating?
The list of car manufacturers who have already said that they are committed to the Scrappage Scheme are:
Citroen | Ford | Hyundai | Kia | Renault | Toyota | Volvo
Terms of the Scrappage Scheme
• Registered keeper must have a UK address on the registration certificate (V5C)
• Vehicle must have been first registered in the UK on or before 31 July 1999
• Must have a valid and current MOT test certificate
• Applies to commercial vans up to 3.5 tonnes as well as cars
• Trade-ins are only available against new cars
• Vehicles must be either registered to the seller or have a SORN (Statutory Off Road Notification) with the DVLA
• The new vehicle must be a car or small van weighing up to 3,500kg, to be registered in the UK on or after mid-May 2009
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