A scheme to encourage the scrapping of old cars to increase the rate at which motorists trade them for newer, more fuel-efficient models, could achieve environmental benefits according to new research by the Royal Automobile Club (RAC) Foundation.

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The report, Car Ownership in Great Britain, concluded that financial encouragement for car owners to scrap older vehicles could encourage fleet renewal, but intervention must be done carefully if the vehicle market is not to be distorted.


“The report relates to use of vehicles but policy must also take account of the environmental implications involved in the manufacture of new vehicles,” the RAC said.


The research showed that in the UK, to reduce emissions, the ideal age to incentivise car scrappage would be for 17-18-year-old cars. Such a scheme would remove most of the last non-catalytic converter-equipped cars [mandatory here from the K-registration prefix in August 1992 – ed].


“Incentivising the scrappage of younger cars would only result in payment being made for cars which are going to be scrapped in large numbers anyway,” the RAC said.

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Encouraging motorists to switch to newer models is a vital part of the fight to cut carbon emissions from road transport, the organisation added.


“The average new car emits 3.8% less carbon than just 12 months ago (158.6g/km, down from 164.9g/km at the end of 2007) and 16.4% less than the in 1997 (189.8g/km).


“Despite this, tax changes announced in the March budget, including the introduction of a ‘showroom tax’, will make buying a new vehicle more expensive. The treasury’s decision to raise vehicle excise duty (colloquially known here in the UK as ‘road tax) retrospectively also increases the financial burden of owning the more fuel-hungry older cars, leaving motorists stuck with inefficient vehicles,” the RAC added.


The credit crunch was also slowing the rate at which people buy new cars, with sales falling for the last five months.


The RAC Foundation said a carefully-designed scrappage scheme would bring the double benefit of boosting the new and second hand car industry, while helping to make road transport ‘greener’ by removing the most-polluting vehicles from the road.


According to the report, cars are scrapped for four main reasons: too expensive to repair, accident damged, not worth much or stopped working


Scrapped cars are not normally replaced by brand new models, but by vehicles typically three to four years younger than the ones scrapped. A vehicle purchased brand new typically replaces a three year old car which has been traded in on the basis of age and mileage. Most new cars are traded in within four years.


The Foundation commissioned the report after scrappage was recommended by the government’s Environmental Audit Committee as a means of encouraging “lower income households … to trade in their cars for low emission replacements,” in order to offer an informed contribution to the debate.


Schemes can offer payments not linked to further action by the car owner, or payments conditional on purchase of a less-polluting newer car.


The RAC report concluded that in the UK, it would not be necessary to link the incentive to buying a new car as the natural dynamics of the car market would lead to the owners buying a car three or four years younger than the one scrapped, which in turn would lead to a ripple effect of car purchases up the age chain of the vehicle parc.


The Foundation rejected the alternatives of higher taxes on older cars, calculated on the basis of their emissions; or more rigorous annual inspection routines which would make older cars more expensive to maintain, as these would place a heavier financial burden on the owners of older cars, who tend to be on lower incomes in the first place.


RAC Foundation director Stephen Glaister said: “Making it affordable for motorists to scrap clapped-out cars and opt instead for a cleaner, more fuel-efficient and more reliable vehicle could be a way for the government to support greener motoring.


“This study identifies a number of countries that have tried scrappage schemes and offers important new evidence to help design a balanced and effective scheme for Britain. This is an essential ingredient of a proper ‘dust-to-dust’ emissions assessment.


“Motorists can’t afford to be on the receiving end of another muddled, poorly thought out scheme like the VED proposals unveiled in March. Any scrappage scheme should be further researched before implementation in order to benefit the environment, motorists and manufacturers, without distorting the market.”

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