The UK’s car retailing association says that momentum is building in favour of a scrappage incentive to raise volume in the UK car market.

‘”The Retail Motor Industry Federation (RMIF) first proposed that the UK should adopt a self-financing scrappage policy at its meeting with Business Secretary Lord Mandelson on 28 November 2008, so it is a positive move to see that the European Commission is thinking along the same lines,” according to RMIF Director Sue Robinson.

Scrappage policies that encourage motorists to dispose of older and more polluting vehicles, in favour of newer vehicles were also one of the options for reviving the car industry discussed today at an extraordinary meeting late last week in Brussels. EU industry ministers discussed the downturn in the automotive industry and a variety of planned national initiatives, as well as those already taken, and consider what else could be done at EU level.

The RMIF, which represents 8,000 UK retail motor businesses believes that a scrappage policy would have the dual benefit of removing high-polluting cars from the road, and help revive car sales at the same time. The scheme would be self-financing, as Government would receive VAT income from new car sales resulting from the scheme.

Robinson believes this could be a good move for the UK, as well as other European member states: “Scrappage policies have been successfully adopted by a number of European countries in the last few years, including Ireland, France, Germany, and Spain,” said Robinson, “and we believe that adopting the policy could help move the economy in the right direction”.

The RMIF will shortly be presenting a paper to Government that puts the case for a self-financing Scrappage Scheme in the UK that mirrors those successfully adopted in other EU states.

“This RMIF initiative is clearly gathering momentum,” added Robinson.