Ever since the Government scrappage scheme was announced by Chancellor of the Exchequer, Alastair Darling at the 2009 Budget, opinions have been divided as to whether the scheme will be of benefit to car dealerships.
Many in the industry feel that the Government have both missed a trick and also penalised many car dealerships, both of new and used cars. There is a large school of thought that believe that the Government should only have implemented the scrappage scheme - whereby a car aged 10 years and older, with road tax and MOT and that has been registered in the driver's name for at least 12 months can scrap their vehicle in return for a minimum of 2,000 pounds discount off the price of a brand new car - if they had offered the discount themselves and not asked the manufacturers to match the 1,000 pounds offered up by the Government.
Because of manufacturers having to put their hands in their pockets, not to mention the added paperwork and docking of bonuses for sales staff at car dealerships up and down the country, the whole scheme can quite rightly be perceived as a bit of a damp squib.
People have also questioned the eco-friendliness of all this:
OK, replacing old polluters with green machines will of course lower the levels of CO2 emissions on our roads, but is it really eco-friendly to destroy cars, many of which are in perfectly good working order, only to replace them with brand new ones?
And of course, taxpayers who have no interest in utilising the scheme are wondering why their money is being offered as a handout for people that are in a position to buy a brand new car.
Conversely, the scrappage scheme has certainly increased interest at car dealerships and early signs suggest it has been a positive move in terms of lifting the sales slump, but the cynics will point to the fact that if the Government had offered even more of an incentive that even more units would have been sold as a consequence.
If car dealerships are experiencing increased sales figures then the Government will look upon the scrappage scheme as a success even though used car sales will have been adversely affected due to less used cars being on the market.
Something had to be done to aid the motor industry and whether the correct strategy has been implemented, only time will tell although early signs point towards the positives.
Author Resource:-
Thomas Pretty is a motoring journalist with many years of experience writing about the car industry. Find out more about car dealerships at http://www.dickensgroup.com/
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