In these hard financial times, many people are being less and less extravagant with their money. People are having to make their money go further and as a result expensive and luxury purchases have reduced.

One industry that has been hugely affected is the car industry. Car sales figures have been significantly down compared to previous years. In an attempt to revive the market, the Government have recently introduced a car scrappage scheme which allows certain car owners to scrap their car in return for £2000 towards a new car.

Those with cars over 10 years old which they have owned for at least 12 months qualify for this car scrappage scheme. They are entitled to a £2000 discount on new cars across the country.

The Government contributes half of this amount in the form of a voucher and the other half is discounted from the cost of the new car by the manufacturer.

This scheme has helped to revitalize the car industry and has lead to a boost in car sales. Since the introduction of the scrappage scheme, over 40,000 cars have been purchased through the scheme, that’s one in five new cars bought in the UK. Makers of small, less expensive vehicles in particular have been particularly successful through this scrappage scheme.

Whilst the Government have set aside £300 million for this scheme, it is thought that this may be increased to ensure that the car market continues to recover from what have been very difficult times. This solution seems to suit the customer, the manufacturers and the Government.