Lord Mandelson takes pragmatic view of car scrappage plan
For anyone operating in the automotive supply chain there will be considerable relief that the Lord Mandelson may extend the car scrappage scheme beyond the original February 2010 deadline.
In recent months there has at last been signs that the £300m scheme, which gives £2000 to anyone trading in a 10 year old car for a new one, has started to drive up orders, both for cars and components in the supply chain.
August new car sales were up 6% year-on-year, the second consecutive month of growth.
Extending the scheme is a pragmatic approach to the problem. The scheme may be costing a lot of money but it needs more time.
Any change to date has been marginal, the up-lift fragile, at best.
For the year to date car sales are still 21.5% lower than the same period last year.
So it is welcome news if the scheme is going to be extended. Turning an industry around takes time, and now the automotive supply chain has been given a bit more time.