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Germany recently announced a program which gives money to citizens to scrap old polluting cars and buy newer, more fuel efficient ones. The program pays 2,500 euros ($3,500 USD) for each car scrapped.
The result has been an incredible success story. Over 150,000 applications have been received, getting polluting old junkers off the road and boosting auto sales by 21.5 percent in February in Germany – all while sales to foreign markets dropped an incredible 51 percent. In short, by getting people to ditch their old cars Germany may be saving their auto market as well as protecting the environment.
Now another European superpower, the United Kingdom, is considering adopting similar scrap-for-cash incentives to boost its struggling auto sales. The Society of Motor Manufacturers and Traders, an industry group, has submitted a plan for a similar scheme to the British government.
The plan could provide a much needed boost for both the UK’s domestic automakers and for U.S. automakers like Ford and GM that sell or own brands in Britain. Apparently, Ford is so confident that the lawmakers will adopt the plan that it has changed its sales figures based on it. Ingvar Sviggum, Ford Europe sales chief, has said he "really expects" the program to go through.
The UK desperately needs something to boost its auto sales. Sales plunged 22 percent in February and are expected to drop even more severely in March. It will likely be hard to argue against a relatively affordable scheme that has the potential to not only save the environment, but the auto industry as well.
via Autoblog Green and Yahoo News
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written by Carl, March 16, 2009
We need to get the high polluting cars off the road, even if there is no fuel savings!
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written by Caster, March 16, 2009
www.greenlifesmartlife.com
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written by Michael, March 16, 2009
They are hyping the German success story and lobbying for a similar national program here.
We already have some regional programs.
I was able to trade in my old clunker for 9 bus passes (100$ each) and 1100$ towards a new bike. You can also choose to take cash towards a new car on a sliding scale with more money paid out for a more efficient car.
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written by MD, March 16, 2009
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written by Damo, March 17, 2009
The environmental standpoint is addressed earlier by other commentors.
As for the financial side, saying that this will stimulate the economy is the same as saying that throwing a rock through a local shop window will stimulate the economy. The theory goes that it provides a job for the glazier. However, what people are ignoring is the opportunity cost of the money spent on the new cars, when the old cars did the job.
The alternative is that the money spent on new cars *replacing* existing infrastructure is instead spent on *new* infrastructure where before it didn't exist.
This is nothing more than politicians being "seen" to be doing something.
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written by Miel Breitsammer, March 17, 2009
@Damo You are very, very wrong.
People in Germany like this plan very much, because it cleans the streets from those old cars that ruin their air.
Plus, parts of the car-based economy benefit from this already.
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written by Crossfire, March 17, 2009
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written by Scatter, March 17, 2009
This measure could have an overall environmental benefit if the old car is replaced by something with a lot lower emissions (I'm thinking about a differential of 80+ g/km which would give you an annual saving of about 1tCO2). However my understanding of the German system is that it can be for any Euro IV car up to 1 year old so you could potentially get a tax payer funded subsidy for something with higher emissions.
Essentially these schemes are all about stimulating the car market, not about the environment. But they could be about the environment if the governments chose to make them so.
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written by Damo, March 17, 2009
The money spent on *replacing* cars has an opportunity cost which could be used to build *new* (ie, that didn't exist before) infrastructure to provide an overall economic (and environmental - where the infrastructure is "green") net benefit to the community.
Miel, you further claim that the cars will be exported to eastern europe and africa, and removing the pollution from *your* streets. That is an extremely elitist attitude, and at the end of the day does nothing to improve the world (just your little part of it - the rest of the world be damned!).
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written by Ferax, March 18, 2009
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written by aeg atg, March 22, 2009
"The UK desperately needs something to boost its auto sales". Really? You tell them!
You say success equals "getting polluting old junkers off the road and boosting auto sales by 21.5 percent". Go, tiger! New cars, new cars!
Are there any restrictions on fuel efficiency of the new cars? None. You didn't ask that though. Move along.
Anyone studied estimated useage of that old junker sitting on the street? No. I guess "near zero".
Estimated usage of the reliable new car? A lot, maybe?
But you weren't dwelling on details. New cars, now!
Maybe Germany has a particular issue with those old Trabant cars, post-unification? Apparently, ecogeek knows or cares nothing of that. New cars, new cars! Go go Ecogeek!
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30% of the environment impact of a car is done outside of its use, e.g. in production and recycling. Shortening the livetime of a car increases this amout up to 50%. That means it depends on the amount of gas saved by the never car, if a scrapping bonus is good or not. With current cars it might be plus/minus zero.