Government to offer loans to buy cars

Generali

!!!!!!? wrote: »

You're coming over all Tin Foil Hat there

Ha ha! Perhaps.

That is how taxation works though.

It seems very strange that a Government that has spent the last dozen years trying to drum into people how evil cars are (mostly through the proxies of speed cameras and parking rules) are now lending money to people to buy cars.

Is it just me or has 'joined up Government' become 'pick 'n' mix Government'?

WTF?_2

Radiantsoul wrote: »

Why?

I can see a problem with matching the payments for use of an asset with the actual use of an asset.

It's generally not a good idea to borrow to buy a luxury - such as a new car.

If you can justify buying a car on the grounds that you need it to be productive (ie. work) then by all means borrow if you need to but chances are that a new car isn't required. If you have enough money saved to buy outright, by all means buy a new car if that's what you want to do with it.

We got into this current mess through people doing stupid stuff like borrowing to buy luxuries and pursue a lifestyle they couldn't afford - now it looks like government policy to make us and future generations pay in order that this senseless behaviour can continue.

Rochdale_Pioneers

Its like this. We have the most efficient car industry we've ever had, including such jewels as Nissan Sunderland, Honda Swindon and Toyota Derby who make hundreds of thousands of vehicles we export to Europe every year. At the moment this industry is on its knees because consumers here and in Europe cannot get credit to buy a car or anything else.

So, do we let these factories shut and let production go abroad when things pick up? Or do we do as other governments have done for years and provide a subsidy? In this case its not the direct subsidy France gives to prop up its inneficient car industry, its aimed to pulling vehicles through the production line.

So: a) Subsidy to keep them open, (b) let them die, (c) ??? Those of you who are bashing this have another suggestion to a or b do you?

StevieJ

Radiantsoul wrote: »

A business without customers is unlikely to be solvent for long. There does need to be some borrowing in the economy, presumably the aim is to tame the rate of increase rather than to slash credit altogether.

The deputy governor of the bank of England made the point that we need to move to a more sensible lending regime but gradually and not yet.

Wookster

Rochdale_Pioneers wrote: »

So, do we let these factories shut and let production go abroad when things pick up? Or do we do as other governments have done for years and provide a subsidy? In this case its not the direct subsidy France gives to prop up its inneficient car industry, its aimed to pulling vehicles through the production line.

The government cannot save everyone.

It should encourage people to live within their means, not more debt that can hardly be afforded.

There is simply too much car production in the world. The best, most efficient will survive and the poor manufacturer's should close.

mramra

mizzbiz wrote: »

Woah, this has got to stop. People shouldn't be borrowing money for new cars anyway.

So what can we borrow money for? Houses or is that not allowed either? Talk about a holier than thou attitude!

Nothing wrong with budgeted borrowing so long as both borrower AND lender are sensible about it.

For example, I recently took a loan to buy a new car that I will run for 4 years. I get a monthly allowance from my company which far exceeds the monthly loan repayment so I'm quids in. And I got a fantastic deal on the price of the car given the current climate. As an added bonus I'm helping (in a very small way) to keep people in jobs in the UK.

Rochdale_Pioneers

Wookster wrote: »

The government cannot save everyone.

It should encourage people to live within their means, not more debt that can hardly be afforded.

There is simply too much car production in the world. The best, most efficient will survive and the poor manufacturer's should close.

Ah the free market approach. You're right about over production and I have no doubt that we will see at least one of the major manufacturers fall over. But are you saying that its in Britain's interest to let all this manufacturing go abroad? You might want to let the unimpeded free market do its job, but France and Germany and others aren't. We stand by and do nothing whilst France jacks up subsidies to PSA and Germany offers car loan cheques to punters willing to buy a Beemer.

WTF?_2

StevieJ wrote: »

The deputy governor of the bank of England made the point that we need to move to a more sensible lending regime but gradually and not yet.

That's like an obese person facing medical problems as a result of their lifestyle saying that they intend to move to a more sensible regime of eating and exercise eventually but are intending to continue to pig out in the near term.

The jig is up as regards credit. Time to 'roll the hard six' and cut back and pay it back.

a_rather_tall_man

Rochdale_Pioneers wrote: »

Its like this. We have the most efficient car industry we've ever had, including such jewels as Nissan Sunderland, Honda Swindon and Toyota Derby who make hundreds of thousands of vehicles we export to Europe every year. At the moment this industry is on its knees because consumers here and in Europe cannot get credit to buy a car or anything else.

So, do we let these factories shut and let production go abroad when things pick up? Or do we do as other governments have done for years and provide a subsidy? In this case its not the direct subsidy France gives to prop up its inneficient car industry, its aimed to pulling vehicles through the production line.

So: a) Subsidy to keep them open, (b) let them die, (c) ??? Those of you who are bashing this have another suggestion to a or b do you?

I thought the majority of the cars that leave these factories are for export, some +70% at least, so assuming the UK government won't be providing loans for people worldwide this isn't really going to have much of an effect anyway.

Wookster

Rochdale_Pioneers wrote: »

Ah the free market approach. You're right about over production and I have no doubt that we will see at least one of the major manufacturers fall over. But are you saying that its in Britain's interest to let all this manufacturing go abroad? You might want to let the unimpeded free market do its job, but France and Germany and others aren't. We stand by and do nothing whilst France jacks up subsidies to PSA and Germany offers car loan cheques to punters willing to buy a Beemer.

Again you show your ignorance of how things work. With the devaluing £ imports will become more expensive and it will become more economic to produce cars locally rather than to import.

The government is not better placed to decide who gets to live and who doesn't than the private sector/ free market.

Rather than this sort of nonsense the government needs to wean people off credit and keep their powder dry to provide support to people who's lives are uprooted by the crisis, otherwise all that will happen is we will be storing up more problems for the future (i.e. more debt, though I don't think you see this is a problem) and an inefficient workforce that believes the government will bail them out everything there is a problem.