Call for cash incentives to scrap cars
March 30th, 2009 | Published in News | 4 Comments
Government program would provide much needed boost for auto industry.
Australian trade groups have joined many of their international counterparts in calling for a scrappage program to boost vehicle sales.
The MTA New South Wales is calling on the Government to follow Europe and the US and implement a stimulus plan to pay drivers $3000 for crushing their old cars.
The scheme is intended to rid Australia of polluting, unsafe cars while providing a much-needed boost to the struggling car industry.
Similar projects are up and running in France, Germany and Brazil, where they have led to an immediate rise in car sales. Germany’s new car sales are up by 10%.Crushed cars
Trade associations in the United Kingdom, and across the Tasman in New Zealand are campaigning for such programs in their markets.
Meanwhile, a Bill proposing a similar plan is being considered in the US congress under the banner ‘cash for clunkers’.
The MTA NSW has written to treasurer Wayne Swan explaining the benefits of the initiative, while the Motor Traders Association of Australia (MTAA) has commissioned think tank Access Economics to produce economic modelling on the costs.
The MTA NSW has asked the Government to pay up to $3000 to crush cars more than 10 years old.
Once the car was destroyed the owner would get a certificate to be presented at a car dealership to receive $3000 off a new car.
“We are not specifying buy Australian or anything else,” MTA NSW’s James McCall says.
“We need to help the industry, including the 103,000 small businesses that make a living from the car industry - and 318,000 workers.”
The MTAA says there are 15 million vehicles in Australia, about half more than 10 years old.
About two million of those are worth less than $3000.
Once you remove vintage cars, there would be about 1.5 million vehicles eligible for the scheme.
“The key is the grant has to be at least equal to what the owner would get if they traded it,” McCall says.
“Our submission asks the government to set aside a maximum of $4.5 billion, spread over three years, which will be plenty to cover the cost.
“But it’s not just a one-way street. In addition to saving jobs, which is ultimately good for the economy, the Government will get 10% GST on the new car sales.”
New vehicles sales slumped to a six-year low in February, data shows.
The Australian Bureau of Statistics reported new motor vehicle sales fell by a seasonally adjusted 3.5% to 73,190 vehicles in February, down from 75,879 in January.
The last time sales were this low was March 2003.
Source: Autofile
April 3rd, 2009 at 5:50 am (#)
Its all good to crush them and get the money for new cars, but what about the repair industry, dont they need help too? Fixing the cars should also be a priority , if you go with that plan the battered repair industry will all but collapse.
May 18th, 2009 at 3:14 am (#)
good idea but what if i have 10 cars older than 10 years .can i scrap them and get a new one free???? make more sense !!cheap motoring and inability to finance a new vehicle are the only reasons i drive things up to 30 years of age ..
July 10th, 2009 at 10:34 am (#)
to Alan - i dont think the scheme will effect repair shops as many of the cars being crushed are just old vehicles which are in need of replacing.
July 15th, 2009 at 4:15 am (#)
To Richard, I agree if the vehicle is of an un-repairable quality, or is un-economical to repair, but give me a break, of course you would approve of it, you are part of a vehicle breaker/ recyclers in the UK, given the fact you make mney out of the process,your opinion is tainted, Alan.