American car scrappage scheme

[rov1200]

Now that most of the developed world has decided to use the scrappage scheme to buy smaller more efficient models how will the American market latch onto this? Britain has been criicized for not jumping on the bandwagon but a statement in next weeks budget is also likely to go along with it.

[andy-hughes]

The 'scrappage' scheme is designed to provide a resurrgence in the UK car market, which has dropped significantly since the recession.

Only problem is - because of the large majority of imported cars into the UK, the scheme here will only subsidise foreign manufacturers. The only 'super-mini' we produce here is the Nissan Micra, and 85% of those are exported.

The U.S. will have no real need to join this scheme for ecconomic reasons, so will probably ignore it.

[jake-the-peg]

What you don't call the mini produced at Oxford "super"?

[andy-hughes]

It's just a generic term for a size of car, not intended to single out one make over another.

[rov1200]

As we are part of Europe and we are not into protectionism, as they keep telling us, then the good of the whole outweighs one particular state. I know we are not a major car producing nation but their are nearly 1,000,000 people employed in the motor industry in this country. If you are saving the jobs of salesmen, repairers, finance and scrap metal merchants making the car is only one part of the chain although the prestige may go. Have you not heard of Nissan in Sunderland or GM in Luton, Ford in Dagenham and Halewood all foreign owned but producing vehicles here

[rov1200]

In the USA there are no companies that produce low emission cars but rely totally on the Japanese imports. Therefore any scrappage scheme will seriously hurt the home grown gas guzzling companies and therefore won't be employed. This is a chance for Europe to push the American market into submission and in future to rely on cars made in Europe as well as Japan that have an discreet advantage.
Even Japan is now using the scrappage scheme in its own country!

[jake-the-peg]

Protectionism happened in the great depression in the 30s and was a disaster all around.

The problem is that giving state subsidies to individual manufactueres is difficult because it is essentually interfering in the market place favouring one commercial enterprise over another and illegal under EU rules and deeply frowned upon elsewhere.

That's why people have latched on to the scrappage idea as a way to subsidise the motor industry whilst keeping to the rules and not favouring one company over another.

Question is whether the motor industry is so vital that we should do this and if so by how much.

To little and there will be no effect, too much will be even more money that will need to be found later.

It would be good if we could find an international scappage system and find a way to claw the money back from the motor industry when they're in better shape.

[rov1200]

Couple of snippets about the car industry today. Germany the most successful of those implementing the scrappage scheme with a 41% increase of sales in new vehicles have reported cleaner air in Berlin.
The announcement by the Chancellor in Britain of a �5000 allowance towards an electric car.
Its a breadth of fresh air (no pun) that something at last is being done to help the consumer as well as pouring �bn's into the banking industry. If we and others are to come out of recession it the consumers buying again not the profits made in the banking industry that decide it.