The SMMT points to evidence from Europe where such schemes are in place and already working.
The call comes as the SMMT’s February figures show sales slipped further last month, down 21.9 per cent to 54,359 units. The diesel market share fell to 44.1 per cent, from 45 per cent in February 2008.
‘New car registrations continue to decline and although government recognises the strategic importance of the UK motor industry, urgent action is still needed,’ said Paul Everitt, SMMT chief executive.
‘Other European countries have been proactive in assisting their automotive industries and it is imperative that UK government increases the pace in responding to industry proposals for a scrappage scheme and access to finance and credit.’
Sales in France – the first country to offer a support package with credit made available to car finance arms and a scrappage scheme – has seen sales decline, but by only 7.9 per cent.
Germany has also been proactive in its support for its car industry introducing a scrappage scheme, reduced road tax and millions of Euros of aid. Sales there are down too, but by 14.2 per cent.
How a scrappage scheme would work in the UK is unclear, but many are calling for incentives for buyers to chop in their old, polluting cars for greener new ones – with cash from the government for doing so.
Many believe this would be one of the best ways to boost the industry – Car Dealer included – as it would give the industry the shot in the arm it needs.
A number of makers back the idea. Kia chiefs told Car Dealer at the Geneva Motor Show that they believed the scrappage proposals were the best way forward.
But the spokesman for the firm warned that if it was announced today ‘it would have to be in place tomorrow’.
‘We can’t have the situation as we saw with VAT last year, where there’s an intermediary period in between any announcement,’ he said.
Who were the winners and losers last month? Download the full figures as an Excel document here: februaryfigures
by JAMES BAGGOTT