The UK Government’s Vehicle Scrapping Scheme Gets a £100m Boost

A Guide to the Car Scrappage Scheme

In the budget of April 2009, the government announced details of a new car scrappage scheme. Designed to give the ailing motor industry a boost this scheme can help a consumer buy a new car with a £2,000+ discount.

Initially set to run until February 2010, or until the subsidies ran out, the government announced at its Party Conference on September 28th, 2009 that the scheme would be extended with the injection of another £100 million to allow vehicle scrappage for up to 400,000 cars and vans. So, how does the scheme work?

How Does the Vehicle Scrappage Scheme Work?

The scheme was established to encourage consumers to buy new cars to give the industry some much-needed support. The aim here is to help people finance the purchase of a new car or van and, in return, they put their old vehicle up for scrap.

The subsidies given here are partly funded by the government and part funded by the car manufacturers. Not all manufacturers have signed up to the scheme but over 40 have, making this an easy way to get a popular vehicle at a cut-price cost for many people.

So, if an individual wants to buy a new car or van from a manufacturer that is taking part in the scheme, then they can get £2,000+ off its cost price. The government covers the first £1,000 with the manufacturer committing to match that with an additional £1,000 discount. In some cases, additional discounts may be offered by the manufacturer to give an even better deal.

What Kinds of Cars/Vans Can be Used in the Car Scrappage Scheme?

Those wishing to take advantage of the scheme have to meet a few qualifying criteria. At the moment these include:

  • Consumers can scrap cars or vans that weigh less than 3.5 tonnes.
  • Cars must be at least ten years old, and vans must be eight years old.
  • The car/van must be registered in the consumer’s name with the DVLA or DVA (in Northern Ireland) and must have been registered for 12 months continuously before the date of the new vehicle order.
  • The car/van must have been registered in the UK on or before 31st August 1999 (this date will change as further details of the extension are announced).
  • The vehicles must be insured at the time that the new vehicle is ordered.
  • The V5C registration certificate must hold a UK address.
  • The vehicle has to have an up to date MOT certificate and a tax disc before the date of the new vehicle order or must have them within 14 days of expiry when the order is made.

What Kinds of Cars or Vans Can Consumers Buy With the Vehicle Scrappage Scheme?

Again, there are some conditions here that may dictate what kinds of cars/vans can be purchased. These include:

  • The car/van purchased cannot exceed 3.5 tonnes in weight and must be a UK spec vehicle.
  • The vehicle must have been initially registered on/after 18th May 2009 in the UK and must be noted as being new when it is first registered (i.e., with no former owners).
  • It must be registered first to the person who is the registered owner of the vehicle that will be scrapped.

The vehicle scrappage scheme has already proved to be an extremely easy way of getting a new car or small van at a highly discounted cost for many people. The extension will, hopefully, allow many others to save some money here.

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