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Car scrappage scheme reaches halfway point

The car scrappage scheme has reached the halfway point just three months after it was launched.

The Department for Business Innovation and Skills announced that car manufacturers have taken 154,927 new car orders under the scheme between 23 April and 2 August. The scheme is available until March 2010 or until the money runs out and has the capacity to take 300,000 new cars under the original £300 million funding pot.

Sims Metal Managements position has not changed. A spokesperson said:  Although the scheme has delivered some benefits in the short term, by artificially accelerating the car buying process through offering an incentive, things are likely to slow down again once the incentive is removed, however, we shall just have to wait and see.

The Society of Motor Manufacturers and Traders announced at the end of July that just 84,361 new vehicles have been registered under the scheme, showing a delay between ordering cars and scrapping them. manager Graham Price said: Although the Governments figures show 154,927 cars have been ordered, this does not mean all these cars have been completely removed and scrapped yet. This is because the car does not get scrapped until the new registration for the new car is made and this is taking time. I think authorised treatment facilities will still be collecting the scrapped cars in the new-year. It seems that some manufacturers may even carry the scheme on after the Governments one is finished because they have been so impressed and surprised by what it has done for them.

Ampthill Metal business development manager Mick Leech also mentioned the delay between ordering and scrapping the cars. He said: If the funding were to be used up soon, traders would still notice scrap coming from the scheme after a further two or three months because people are having to wait for their new cars to be imported before they are scrapped. I do think it will gradually fizzle out leading up to Christmas but it seems there have been rumours the Government might extend it.

Another trader said: The scheme has been a success but it was set up in order to help the car manufacturing business rather than the scrap industry and it has done that. We would rather it didnt end though because anything that gives us more scrap is great.

BIS revealed that new cars bought under the scheme generate on average 25 per cent less CO2 emissions than the scrapped cars. The average CO2 figure for new cars bought through the scheme is around133.9g/km, while the average for the scrapped cars is thought to be at least 179g/km.

Those who can take advantage of the cash for bangers scheme must own a car which is at least ten years old. The owner will then receive £1,000 from the car manufacturer and £1,000 from the Government to put towards buying a new car.

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