Calls for an old-car scrappage scheme here in the UK intensified today as an auto workers union leader visit visiting workers at BMW’s Mini plant in Oxford called for more support for the car industry.
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Unite joint general secretary Derek Simpson called on the government to introduce an “old banger bonus”scheme, similar to the successful German scheme, as part of a comprehensive package to support the UK car industry.
The Autowrack Prämie, introduced recently by the German Government as part of a GBP47bn stimulus package has proved an instant success. The scheme gives car owners the equivalent of GBP2,500 to trade in their old cars and the German government has put aside €1.5bn to finance the scheme – enough to buy 600,000 cars, Unite said.
Similar schemes are in operation or have been previously used in a number of other European countries, including Spain, France and Ireland.
Britain’s Retail Motor Industry Federation (RMIF) last November suggested the UK should adopt a self-financing scrappage policy at a meeting with business secretary Lord Mandelson. As just-auto reported today, the EU is also discussing Europe-wide plans for such schemes.
Unite acknowledged the UK government recently committed to a GBP2.9bn car industry support package but urged it to go much further.
“Unite is calling for GBP13bn fund to be made available to provide interim relief for producers and to cover employment costs during the crisis period. This package could be used to support a similar scheme to the Germans but only as part of a wider, strategic and significant support package,” the unions said.
Simpson added: “Car producers in the UK are hanging on by a thread because of a lack of credit from the banks and a dramatic fall-off in demand for cars. A scheme similar to the one introduced by the Germans would be a hugely popular way to boost car sales, but only as part of a wider, strategic and significant support package.
“The support that Lord Mandelson announced towards the end of January is a start. Underwriting loans from the European Investment Bank and making millions of pounds available to help with retraining for car industry workers during the downturn is to be welcomed but much more support will be needed.
“We now need to build on this initial phase of support. More has to be done to throw a lifeline to the car and components sector, and we need the sort of confidence-building measures that will stimulate demand for cars among the public. If no-one is buying cars, it makes it very difficult for a rescue package to work.”
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