Blog: Dave LeggettUK scrappage scheme

Dave Leggett | 7 October 2009

It is clear that Britain's scrappage scheme has helped to stimulate the market and that's a good thing. But there is a danger of people perhaps overdoing its importance to British manufacturing. It obviously is helping the retail sector, but the boost to British manufacturing is perhaps not as big as some people are implying. Some commentators – Professor Garel Rhys among them – have even argued that the money spent on subsiding car purchase would be better spent by being targeted specifically at manufacturers.

I wouldn't quite go that far. I think the scheme has played an important role in kick-starting activity and we perhaps need to keep a pan-European perspective on this.

Booming sales in Germany, for example, will have also helped manufacturers with UK facilities – such as Nissan, Honda and Toyota. And there are many British suppliers to OEM plants in mainland Europe etc. National distinctions in terms of economic activity are a little blurred in Europe – UK vehicle producing plants export a big proportion of what is made here to mainland Europe.

But the UK sales figures for September issued by the SMMT are particularly interesting as they illustrate where the market boost from scrappage might be going. How many of these top ten models are made in Britain? Astra and Mini is about it. I'm not against the scrappage scheme – it has most definitely been needed given the scale of the market plunge this year – but let's keep the talk of how it's helping UK manufacturers in perspective, not least because government ministers need to appreciate that other support measures better targeted at manufacturers are important, too.

1 Fiesta 22,635

2 Corsa 16,379

3 Focus 13,622

4 Astra 13,190

5 Golf 11,787

6 207 9,161

7 MINI 8,634

8 3 Series 7,465

9 Yaris 6,896

10 1 Series 6,671

 


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