The Green Piece - Tuesday 23rd June 2009
Since the introduction of Britain's vehicle scrappage scheme, everything appears rosy for the country's automotive industry once more. According to Government figures, orders for new cars have been boosted by 60,000; Toyota has seen its order book lifted by more than 7,000; and Nissan has taken an additional 2,383 orders from customers looking to scrap their cars, prompting it to take on more staff on temporary contracts.
Hard to argue with statistics like that, isn't it? Except people are arguing – and they're arguing loudly.
Environmentalists have dubbed the vehicle scrappage scheme "a bailout masquerading as a green initiative" and have slammed the Government for failing to tie the initiative to green cars.
Here's what they could have done…
Ostensibly, the scrappage scheme has been presented as an incentive to buy less polluting cars and therefore reduce damage to the environment. By restricting the cars that can be scrapped to those that are at least 10 years old the Government hopes to get "old bangers" off the road, and newer, less polluting alternatives out there.
However, the manufacture of new cars in itself pumps carbon dioxide (CO2) into the atmosphere. The way to offset this would have been to make the incentives only available to cars that emit less than 130g/km of CO2 (the EU target for 2012). By scrapping the older polluting cars and applying the scheme only to the greenest new cars, the short-term spike in CO2 emissions during manufacturing would be wiped out within six years, delivering a net gain to the environment.
Yet the Government chose to ignore these potential environmental benefits and instead concentrated purely on short-term economic gain.
Money talks
And just how great is that economic gain? Britain's scrappage scheme is widely thought to be based on the success of a similar initiative in Germany. Europe's largest auto market enjoyed 380,000 new car registrations in April – the third monthly increase for the country in a row, and that on the back of March which witnessed the biggest rise in registrations since 1992.
However, the £2,000 being made available in the UK comes half from the Government and half from the vehicle manufacturers. The vehicle industry was already providing significant incentives to customers – delivery mileage Vauxhalls had been marketed with 40 per cent discounts and mid-range unused Fords had been offered with more than £5,000 off. By comparison, the Government subsidy appears almost measly.
Indeed, despite the spin, sales have hardly been outstanding - industry body the Society of Motor Manufacturers and Traders (SMMT) reports that new car registrations in May fell at an annual rate of almost 25 per cent to 134,858 units. This reflects little change compared to the previous month.
Yes such a widely publicised Government-led incentive is headline grabbing and has caught the attention of some sections of the previously unaware public. However, it's clear that the real deals are available in the form of no-nonsense, upfront discounts.
A greener choice
And if it's green you want, as opposed to just more green in your wallet, then perhaps you'd be better off hanging on to your old car for at least a little while longer.
The Environmental Transport Association states that even if the new model you buy is more economical, once you take into account the energy needed to scrap the old one and build a new one, the environmental benefits are likely to be minimal at best.
So instead car owners should hang on to their vehicles until they are no longer reliable and focus on greener driving techniques such as avoiding harsh acceleration and braking, and looking as far up the road as possible to avoid stop/start driving.
This way, by the time your car is really ready for the scrapheap, perhaps we'll have infrastructure in place to make electric or hydrogen cars a legitimate alternative. Maybe there'll even be some real incentives too.
Faye Sunderland
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