Min­is­ters put the brakes on scrap­page scheme for cars

The Daily Telegraph - Business - - Business - By Alan Tovey

HOPES of a scrap­page scheme to jump­start Bri­tain’s car in­dus­try have been dashed by min­is­ters fol­low­ing weeks of spec­u­la­tion.

Pro­pos­als to of­fer mo­torists up to £6,000 when they swapped their old petrol or diesel car for an elec­tric one were ruled out by the Gov­ern­ment in a blow to cri­sis-hit man­u­fac­tur­ers. There was con­cern that the scheme would fail to help ma­jor UK mar­ques such as Jaguar Land Rover be­cause so few elec­tric cars are made in Bri­tain.

In a state­ment to trade magazine

Auto Ex­press, the Gov­ern­ment said: “We have no cur­rent plans to change the ex­ist­ing in­cen­tives or to in­tro­duce a scrap­page scheme.

“We are com­mit­ted to build­ing a greener trans­port sys­tem and re­duc­ing car­bon emis­sions to reach our goal of net zero by 2050.”

France, Ger­many and Spain have all re­vealed multi­bil­lion-euro sup­port pack­ages for their car in­dus­tries. Th­ese in­clude pay­ments to mo­torists who trade in their ve­hi­cles for new, less pol­lut­ing mod­els.

Bri­tain’s car in­dus­try – which last year turned over £82bn and gen­er­ated 14.4pc of the coun­try’s goods ex­ports – has been bat­tered by coro­n­avirus.

Sales of new cars are down by 51.4pc in the year to date, with just 508,125 new ve­hi­cles reg­is­tered. Pro­duc­tion lev­els have been sim­i­larly hard hit, some 41.7pc lower than at the same point a year ago, with just 324,763 cars rolling off UK pro­duc­tion lines.

The dire per­for­mances cast se­ri­ous doubts over the fu­ture of the 168,000 jobs in the UK di­rectly in­volved in ve­hi­cle man­u­fac­tur­ing, as well as the 823,000 in the wide sec­tor in roles such as sales and main­te­nance.

The So­ci­ety of Mo­tor Man­u­fac­tur­ers and Traders last week warned that one in six jobs in the in­dus­try were at risk be­cause of the im­pact of coro­n­avirus.

It sounded the alarm with 6,000 au­to­mo­tive re­dun­dan­cies hav­ing been so far an­nounced in June, with many more thought have been made in the sup­ply chain.

The trade body has called for VAT cuts and “poli­cies that boost con­sumer con­fi­dence”, and sup­ports a scrap­page scheme.

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