Volkswagen, Nissan, Toyota and Kia on Friday became the latest carmakers to launch their own scrappage schemes in Britain, as sales slide, saying they aimed to get motorists to trade in their old cars for less polluting new models.
New car registrations fell for the fourth month in a row in July, the longest run of declines since 2011, as demand cools due to faltering consumer confidence ahead of Brexit and uncertainty over whether the government will impose new penalties on drivers of the most-polluting vehicles.
VW said it will offer discounts of up to 6,000 pounds ($7,760) on a new car if drivers trade in an older vehicle.
Meanwhile Toyota said motorists could save up to 4,000 pounds under its new scrappage scheme, Nissan is offering a maximum discount of 5,000 pounds and Kia 2,000 pounds.
The firms join Ford, BMW, Mercedes-Benz and Vauxhall, who have all announced similar schemes in recent weeks, together accounting for around two thirds of the new car market in Britain.
Carmakers are keen to promote their green credentials in the wake of the VW emissions scandal but sales in September, one of only two occasions each year when a new licence plate series is introduced to indicate the age of the car, normally account for nearly 20 percent of full-year demand in Britain.
“Most of them (the trade-in schemes) are renamed marketing campaigns … so I think it’s mostly a matter of spurring demand in the UK,” Evercore ISI analyst Arndt Ellinghorst told Reuters.
“The market is at an historically high level so the intensity of competition naturally increases and these sales departments want to protect some of their volumes,” he said.
VW’s scheme comes nearly two years since the firm admitted to cheating diesel pollution tests with the use of manipulated engine management software, subjecting it and the industry to intense pressure to cut pollution.
Carmakers had been hoping for a British government-backed scrappage scheme, which would be the first since 2009, when ministers intervened to support car sales as they nose-dived in the wake of the financial crisis.
But in July the government once again delayed a decision over whether to introduce a nationwide or targeted programme, with a consultation due to take place later this year, despite worries over emissions levels.