Ford has called for a continuation of the scrappage scheme beyond the £330m funding limit imposed by the government. Speaking exclusively to Motor Trader, Ford of Britain managing director Nigel Sharpe said the following:

Sorn vehicles

Sharp said Ford would like to see some form of continuation and it would also like Sorn vehicles to be included in the scheme.

Sharp said any additional help now would ease the pain of what looks set to be an equally tough 2010.

“Next year we’ll potentially have a market without scrappage, a VAT increase, probably an environment where interest rates will track upwards and the cumulative effect of the pound being worth 25 per cent less than it was 18 months ago coming through in greater prices.

Scrappage extension

“Add all those things together and you could see a reduced level of demand so an extension of scrappage would be extremely helpful,” he said. Sharp said the industry can present a strong argument to the government for the continuation of scrappage as it would take a high number of higher polluting and less frugal cars off the road.

VAT increase

Sharp also expects some interesting dynamics in the final quarter of the year before the widely anticipated hike in the rate of VAT. “There’s a (financial) cap of 300,000 vehicles under the scheme so it will be interesting to see how customers will behave. Some will want to get in quickly before the cap comes down.

“You also have the issue of the VAT change at the year-end. People will be rushing to participate and beat the VAT change,” he said.

Article from Motor Trader