Scrappage scheme could backfire

The Independent Automotive Aftermarket Federation (IAAF) has argued against the introduction of a new scrappage scheme.

It has warned that while the intention may be to get the industry moving again, it may in fact have the opposite effect.

The IAAF argues that if introduced, it will have a significantly negative effect on public mobility and the automotive aftermarket long term, especially as most of the vehicles eligible for the scheme will still be very much roadworthy.

This prediction is based on previous experience as in 2009, a scrappage scheme removed 400,000 serviceable vehicles from the aftermarket, with more than 90 per cent of vehicles sold under the scheme originating from non-UK factories. In 2020, the situation remains largely the same with 88 per cent of cars sold in the UK during 2019 being imported.

As the UK aftermarket also employs approximately 347,000 people as opposed to 186,000 in vehicle manufacturing, employment in the independent automotive aftermarket would be damaged by a scrappage scheme and jeopardise thousands of repair businesses.

With a newer vehicle parc, there is also a risk that VMs could potentially gain a monopoly on access to vehicle technical condition data, raising the question of data access.

Wendy Williamson, IAAF chief executive, said: “Motorists are currently under great pressure, and they should not be penalised for keeping hold of vehicles that are in good working condition and can continue to be serviced, repaired and maintained long into the future. Not only is this unfair to consumers, but it is putting the aftermarket at great risk, as it will result in a direct decrease in the number of vehicles entering independent garages.

“Changing the habits of consumers is difficult, and if the scrappage scheme is introduced, there is no guarantee that a motorist will opt for an electric vehicle over a petrol or diesel vehicle. Perhaps a more feasible option would be to introduce a limited scheme targeted at those living closest to clean air zones as demand for electric vehicles will be higher in these areas.

“It’s crucial that any proposals are reviewed as the economic impact of a scrappage scheme could be detrimental to the aftermarket and place an unnecessary financial burden on the consumer.”