Clock is ticking on scrappage discounts
Time is running out if you want to take advantage of the UK car scrappage scheme.
Business secretary Lord Mandelson revealed on Wednesday that the initiative has entered its final stages with the last remaining funds divided between manufacturers.
The scrappage scheme combines a £1,000 bonus from the government with £1,000 from car manufacturers to give owners of cars 10 years or older £2,000 off a new vehicle.
With around 355,000 cars sold under the scheme so far, the last remaining portion of the funds is being allocated to makers depending on their 'brand popularity' in what's been dubbed 'phase one of the exit strategy'.
How this stage would work has been the subject of much debate in the industry, as every carmaker understandably wanted the biggest slice of the funds. The allocations have ultimately been decided by totting up the total number of cars sold to the public, known as retail sales, since the scheme began. This includes all sales, not just those made under scrappage.
So what does this mean to buyers? Well, quite simply, if you want a car under scrappage you need to be quick! Only 50,000 orders remain and, as these have been distributed between the 37 vehicle manufacturers taking part, supply will be strictly limited.
If you are planning on buying a car utilising the discount, our advice would be to do it now. At the height of the incentive, more than 10,000 vehicles were being sold a week and it's likely the publicity surrounding the final stages will intensify that demand.
Manufacturers are even planning to ration scrappage funds between their own dealers so you might have to travel around to place an order.
"This is last orders for the scrappage scheme," explained Lord Mandelson. "Car owners need to move quickly to avoid disappointment if they want to buy a new car at a discount."
Although the end is near, the final throes of the scrappage scheme will include one more allocation of funds when the very last dregs of the cash are handed out. The Department for Business, Innovation and Skills says the last 20 per cent will be divided depending on sales made under 'phase one'.
That's good news for the likes of Ford, Hyundai and Kia, all of whom have made huge sales increases under scrappage and are likely to take the lions share of the last allocation of funds.
"In this final stage of the scheme there are strict order limits on manufacturers," added a BIS spokesperson. "To avoid disappointment consumers are urged to place their orders quickly, particularly if they have a specific car in mind."