News from Welsh Labour

AM urges Assembly Government to back car scrappage scheme

A Labour Assembly Member is urging the Welsh Assembly Government to support calls for the introduction of a car scrappage incentive scheme for second hand vehicles to help boost the Welsh automotive industry.

Wrexham’s AM, Lesley Griffiths, believes it would help increase consumer confidence and also give much needed support to the automotive industry and its 800,000 workers.

She is now urging the Assembly Government to call upon the UK Government to implement a car scrappage incentive scheme.

Similar schemes have been already introduced in other countries with great success and in recent weeks the Society of Motor Manufacturers and Traders, Welsh employer organisations and Welsh car dealers have all called for the scheme to be implemented in the UK.

A car scrappage scheme would provide an incentive for owners of cars and vans over nine years old to scrap their car, in accordance with the European End of Life Vehicle directive, in exchange for £2,000 towards a new or nearly new vehicle. This incentive would, consequently, boost UK new car sales and place the Welsh automotive industry on a much safer footing.

A recent survey commissioned by the Society of Motor Manufacturers and Traders found that 76% of consumers are in favour of the UK Government introducing a scrappage incentive scheme.

The success of the incentive scheme across Europe is striking:

* In Germany, new car registrations rose by 30% in February this year, after the launch of the scheme, according to the European Automobile Manufacturers Association (ACEA). As a result, total sales for 2009 could reach 3.1 million cars instead of the 2.8 million forecast initially, the association said
* In France, roughly 20% of all cars sold in January 2009 had benefited from a similar scrapping incentive, according to ACEA
* In Portugal, 16% of all cars purchased in 2008 replaced old vehicles that had qualified for the scrapping incentive

Commenting on her call, Lesley Griffiths AM said:

“The benefits to Wales in having a car scrappage scheme in operation in the UK are clear. Other European countries have introduced it with great success.

“The Welsh automotive sector is made up of over 250 companies, employing well over 20,000 people. Our automotive component business is worth £2 billion to Wales. It is obvious that we have to support policies that help protect that sector of our economy and as other countries have proved, a scrappage scheme does exactly this.

“The Welsh Assembly Government was quick off the mark in implementing the ProAct scheme to save jobs in the automotive industry first and it was highly successful. I believe having a scrappage scheme would give a further boost to the industry, however, it is a matter for the UK Government to implement.

“I have therefore written to the Welsh Assembly Government, asking them to add their voice to the growing calls for a car scrappage scheme to be introduced here in Wales. I hope they now ask the UK Government to act quickly on this issue.”

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