Germany’s EUR5bn (US$7.1bn) fund to help consumers scrap old cars and buy new ones could run dry by 10 September, according to estimates from the Centre for Automotive Research at the University of Duisburg-Essen.
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The fund has been credited with fuelling demand for new cars during the first half of the year, helping to boost sales by 23% year on year.
Just EUR237m remains in the fund and the agency for economy and export control said the government has received applications valued at an average of EUR24.3m a day over the last five weeks.
“Everyone was surprised it went this quickly,” Ferdinand Dudenhoeffer, centre director told Bloomberg News. “Two million applications really are a whole lot, and nobody could even predict that the entire fund would get emptied.”
A 23% increase in car purchases in the first half helped boost overall demand by 0.1%, the federal statistics office reported yesterday.
Berlin said earlier this week that there were no plans to extend the scheme. Elections take place on 27 September.
While Germany’s car market expanded a quarter in the first half, it won’t be able to sustain that growth next year when the incentive ends, Germany’s main auto-industry association said on 2 July.
“We will still see a sales increase in November because there is a pile of applications that has not been cashed in,” Dudenhoeffer said. “But next year, demand will drop.”
The amount remaining in the fund was calculated by multiplying the almost 95,000 available applications by the EUR2,500 rebate car buyers can receive. The date when the funds may run out was calculated by dividing the remaining cash by the average value of applications each working day.
