Car scrappage scheme - genuine savings?

Polly

Very interested in trading in my old banger when this scheme starts in mid-May. However, my very cynical husband reckons that the dealers will do fancy stuff with the numbers to negate any saving. Really interested in getting a good car at a great price but disappointed if this doesn't turn out to be a genuine discount. Just wanted some thoughts from others, especially those in the car trade.

ballyblack

In a word NO!


From Daily telegraph

Darling's scrappage scheme fails to deliver

Don't rush out to exchange your old car just yet, says our consumer champion.

By Mike Rutherford
Last Updated: 4:52PM BST 23 Apr 2009

"I'm astonished that car-makers, importers, dealers and at least one misguided motoring organisation have collectively welcomed Alistair Darling's ill thought-out, thoroughly underwhelming car scrappage scheme.
They're all entitled to their opinions, of course. As am I. And with that in mind, I make no apologies for arguing that the Chancellor confused and cheated motorists when he delivered his Budget speech on Wednesday. It's the thinking behind, and the delivery of, his scrap car scheme that worries me.

My advice to customers thinking of scrapping their 10-year-old cars is to hold fire for a week or two at least. The full details of how the scrap scheme will work for and against car sellers and buyers in the real world are still far from clear. Dive in and sign on the dotted line now and I fear that instead of gaining, many customers could be worse off financially.
Problem one is that Mr Darling's Budget speech contained some dangerously misleading implications. He talked enthusiastically about implementing a scrappage scheme orchestrated by himself and providing motorists with a generous £2,000 discount when they buy new cars at the same time as trading in/scrapping cars that are 10 years (or more) old.
The message was clear. A two grand incentive was on the table from Government. Accordingly, owners of cars that have already passed their 10th birthdays immediately started doing their sums and, not unreasonably, concluded that a factory fresh car with a price of, say, £10,000 would – courtesy of Mr Darling – be subsidised to the tune of £2,000, then be blessed with a further discount of a similar sum from the dealer.
End result? The unused £10,000 car becomes a £6,000 car. Brilliant! The consumer secures a great deal. Air quality improves. Vehicle manufacturing industry/motor trade activity and employment prospects are boosted as the market is stimulated by the Government handout. And while giving with one hand, the Government cheekily takes back with the other, because it makes a fat profit on every car sold, thanks to VAT. Never mind. In short, everyone's a winner.
Or at least they should have been. But oh no, while Darling clearly implied that the Government would "provide motorists with a £2,000 discount on new vehicles bought when they trade in cars over 10 years old", the reality is that he will hand over at most £1,000 – and, even then, only under strict terms and conditions to only 300,000 buyers, who represent less than 10 per cent of motorists in Britain.
Cheekily and counter-productively as far as the consumer is concerned, Mr Darling ordered the car industry to stump up the other £1,000. Is he looking to the vehicle manufacturers, the importers of those vehicles or the retailers to go 50:50 with him on the two grand incentive to buy? It's not clear. Are all firms in the motor business willing to team-up in such a joint venture when it was masterminded (well, sort of) by the car-loathing Mr Darling from the car-hostile Labour party? I doubt it. Let's not forget that this is the man who gave motorists a hellish time when he was Transport Secretary. And since it came to office in 1997 his Government has stood by and watched the death of MG Rover and Longbridge, the total withdrawal of Ford car production in Britain, the murder of TVR, the closure of Peugeot in Coventry and the halting of Vauxhall car production in Luton.
For now, ignore the Chancellor's overly-complicated scrappage scheme. If you've got an old banger it might be worth considerably more on the open used car market than it is as one of Darling's proposed scrap cars.
If you've got such a machine, first try to sell it privately. You never know, it may be worth many thousands. Then after getting shot of it (or keeping it if it means more to you to hang on to it) visit or speak to a franchised or non-franchised retailer of unused cars.
Put that measly £1,000 Government subsidy matched by another grand off from the motor industry (allegedly!) to the back of your mind.
Think instead in terms of no-nonsense, up-front discounts of thousands or even tens of thousands of pounds. Lately, even modest, mid-range unused Fords have been available with more than £5,000 off, even before the haggling starts. Delivery mileage Vauxhalls have been marketed with 40 per cent discounts.
These are real deals for real consumers. They are not to be confused with Government-backed gimmicks on offer with strings attached from clueless, here today, gone tomorrow politicians"

ballyblack

Discussed at length on this forum;


http://www.honestjohn.co.uk/forum/post/index.htm?f=2&t=74372

warmhands.coldheart

Article in Sunday times also on Sunday also suggested that the Dealers were raising prices to ofset any discount from Car Scrapage scheme. Complete waste of time in my view.

why is it that any schemes brought out by government end up a complete farce when they try to implement them??

ballyblack

Because this Labour government is more interested in 'spin' than real policies to help the economy

JasonLVC

warmhands.coldheart wrote: »

why is it that any schemes brought out by government end up a complete farce when they try to implement them??

Any scheme where the government provides a grant or subsidy will always fall victim to greed or mis-direction.

The government offered grants to convert your car to LPG - but the cost of getting the work done was always MORE than the grant (and more than the actual job involved).

You can get a grant to put a PV cell on your roof or wind turbine in your garden, but once the suppliers know you'll get £5k grant, they simply put £5k onto the selling price so that it looks like you're getting a bargain and supplier is effectively being paid £5k directly from the government.

Energy saving grants sound good, but you can only use government approved suppliers for the works....who are always twice as dear as the local plumber would be.

Why would this car scheme be any different?. Dealers will increase prices (due to Euro, even though some cars are made in the UK), hard sell the extras (ie, "we only have metallic in stock at £600 extra" when there's a compound in Southampton full of solid colours), etc.

Sorry for being cynical, but where there's a grant, there's a rip off.

Artofdookie

My Ma was looking at this, trading her 98 Punto in and getting a new Panda for £4995, but online i can get her the same model new Panda for £5325 + ill get her at least £600 for her old car. So she'll be at least £300 better off by not scraping hers

mofopants

Artofdookie wrote: »

My Ma was looking at this, trading her 98 Punto in and getting a new Panda for £4995, but online i can get her the same model new Panda for £5325 + ill get her at least £600 for her old car. So she'll be at least £300 better off by not scraping hers

I would recommend the panda - i bought one last year for £4995 pre reg and its brilliant

ballyblack

http://forums.moneysavingexpert.com/showthread.html?p=21084243#post21084243

Choco

Anyone know exact date in May yet?

ballyblack

18th May







Car scrappage scheme 'unpopular'

By Brian Milligan
Business reporter, BBC News


The government's scrappage scheme starts later this month
There is growing evidence that the government's forthcoming scheme to scrap hundreds of thousands of old cars is not that popular with motorists.
A new survey suggests most people who have studied the scrappage scheme have decided not to take advantage of it.
Researchers from car price guide Parker's questioned 600 people online.
It found that 70% of respondents said the scheme was not generous enough, and overall 81% said they would not be taking advantage of it.
'Massively disappointed'
The scrappage scheme starts on 18 May. If your car is at least 10 years old you can scrap it, in return for a substantial discount on a new car.
The government will provide a £1,000 subsidy for each car purchased, and manufacturers will provide at least a similar amount.
But Kieren Puffet, the editor of Parker's Guide, said many motorists have managed to find much larger discounts under existing deals.
"They're massively disappointed," he said. "They were hoping for a lot more from the government."
Julia Smith, who lives in Basingstoke in Hampshire, is one of those who initially thought the scheme would be useful, but has since decided against it. She was going to scrap her 13-year-old Volvo, and buy a new one instead.
With the scrappage scheme discounts, a brand new Volvo would have cost her in the region of £21,000. But she then found exactly the same model with less than 10,000 miles on the clock for £17,000. A saving of £4,000 proved irresistible.
"In practice this scheme is just not working," she says. "I think it just hasn't been thought through terribly well."
Lukewarm response