Manufacturers will claw back scrappage subsidy says retailer

Manufacturers are responsible for providing half of the scrappage scheme subsidy and they will try to reclaim this money by removing discounts and special offers.

This is the opinion of vehicle retailer Carcraft, which has "expressed doubt" over how much help the initiative can actually provide for consumers.

It said that manufacturers will "claw back" the money they give to the scheme "leaving the buyer little better off".

Carcraft also suggested that because "most" people drive cars over ten years old due to the price of a new replacement, £2,000 towards the cost of it will not make much of a dent.

"A £2,000 subsidy doesn't automatically put a new car within their reach," said a spokesperson. "In the current climate, many won't even qualify for finance to make up the shortfall."

The scrappage scheme was announced in the 2009 Budget last week by chancellor of the exchequer Alistair Darling.

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