New car buyers have been given more time to take advantage of the £2000 scrappage discount.
The plans were due to finish at the end of February, but the scheme will now continue to the end of March or until the funds have run out. However, the government has said no more funding will be added.
Figures from the Department for Business Innovation and Skills (BIS) show that up to January 24 there had been 330,722 orders placed with the discount. This means there is still enough money left for nearly 70,000 car buyers to use.
This extension should also give manufacturers and the Government time to work out how to phase the scheme out properly. Previously there had been widespread confusion as to how the scheme would finish.
The Government announced that the remaining funds were set to be shared out between manufacturers depending on new car registrations but didn't make it clear whether it was total new car registrations or just new car registrations under the cash-for-scrap scheme.
If the remaining funds are allocated based on total new car registrations some popular brands under scrappage, such as Hyundai, could be penalised. The funding allocation wouldn't reflect the customer demand for the cheques-for-wrecks offers leaving some car buyers unable to take advantage of some manufacturers offers even though there is still government funds available.
A number of manufacturers have set up their own schemes similar to the scrappage discount as they prepare for the end of the incentive including Hyundai who will introduce a £2000 swappage scheme.
With an original total of £300m set aside for the scheme this was then extended further to £400m back in September 2009.
The scrappage plans have been hailed a success by the Government and the Society of Motor Manufacturers and Traders as new car sales have improved since the original scheme was launched back in May.
