Scrappage: not be-all and end-all

  • Expect more discount schemes after scrappage
  • Motor finance-backed new car sales up 23 per cent
  • Nissan boss predicts 10 per cent sales drop in spring

Buyers can still expect to get decent discounts after the scrappage scheme ends this month because car makers will want to not want to see their 2010 sales take a nosedive. 

Nissan's UK managing director Paul Wilcox told Parker's that a number of manufacturers, particularly the Korean brands that did well during the government's scrappage scheme, will introduce their own discount schemes in a bid to continue attracting customers. 

He said: 'Last year about 80% of Hyundai's retail sales were under the scrappage scheme. They did particularly well, but they won't want to lose the momentum. I expect there'll be more discount schemes - in all different shapes and sizes - from a number of other manufacturers.'

According to latest figures from the Finance and Leasing Association new car finance retail sales were up almost a quarter on last year, largely because of scrappage and that sales were so poor in January 2009.

Consumers bought 23% more new cars using motor finance through dealers in January than in January 2009. About 19% fewer used cars were sold on dealer finance in January than the same period last year, however.

Although scrappage has been a welcome boon for the car industry, Wilcox said he expects the market to contract by about 10% after the scheme comes to an end.

'Sales will level off, not only because of the scrappage scheme closing but also because of the election,' he added. 'People will be fairly cautious about what the next government is planning to do - and that's probably not a bad time to buy because discounts should be available. I expect things to pick up again in the autumn though.'