German Scrappage Scheme Ends
Market analysts are predicting that the German market scrappage scheme is likely to have come to end today as demand for cars purchased under the scheme now exceeds supply. According to a Deutsche bank report published today the scheme has been responsible for 9000 unit sales a day since its introduction and – as of today – only 5000 applications remain.
German government investment in the project is estimated to amount to 5 billion euros, with this investment believed to have supported 2 million new/nearly new vehicle sales. In Germany’s case this kind of market support has driven sales near an all-time high while the economy recorded “the worst GDP decline since the end of the Second World War.” according to Deutsche Bank.
However, moving forward, domestic demand is expected to “collapse” in the months to come with analysts predicting the German car market will decline to 2.7 million units (-25 per cent) in 2010, potentially the worst level since reunification.