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BUDGET '09: Scrappage could harm new car sales, says BVRLA

Date: 22 April 2009

John Lewis

Leasing and rental industry body the BVRLA has slammed the Government over its Budget 2009 announcements delivered by Chancellor Alistair Darling today.

Describing the scrappage scheme as a "flawed model which will damage this country's used car market", BVRLA chief executive John Lewis said: "The Government seems to have ignored the close link between the used and new car markets.

"This scheme could completely stifle the recent recovery we have seen in used car prices, wiping up to £6bn off of the value of business fleets across the UK," said Lewis.

"Hit by falling values, many companies will decide that they cannot afford to sell their existing cars at the moment and will delay any new vehicle purchases until the used market recovers."

Lewis said the Government should have followed the Dutch model, where used cars and vans meeting certain emissions criteria are also included.

"Most people scrapping a vehicle will still not be able to afford or access the credit they would need to purchase a shiny new car or van," he said.

The 2p per litre fuel duty increase also incurred Lewis's wrath.

"The Government is happy to bail out the manufacturers and bankers who make vehicles and lend you the money to buy them, but it takes perverse pleasure in punishing anyone who actually wants to use one and help contribute to the UK economy," he said.

"Coming just weeks after a previous 1.84p per litre rise in fuel duty, this announcement will increase the financial burden on millions of businesses for whom road transport is an essential tool, not a discretionary luxury."