Car scrap bonus change hits sales
Last chance to benefit from the prime à la casse bonus, which will be axed on December 31
CAR manufacturers have warned of a new wave of insolvencies and closures, as new vehicle sales fall to levels last seen two years ago.
New car registrations fell 18.7 per cent year on year in October to 171,449, according to new figures from the manufacturers' trade body, the Comité des Constructeurs Français d'Automobiles.
The decline was sharpest among French brands, which were down 19.8 per cent, compared with a 17.4 per cent drop for foreign cars.
It is the sixth consecutive month of decline and comes as the government prepares to axe a bonus scheme for buyers that has kept the industry afloat since late 2008.
The prime à la casse - a contribution towards the cost of a new car when scrapping a vehicle more than 10 years old - was introduced to encourage people to buy new cars despite the economic crisis.
It paid €1,000 last year and fell to €700 in January and €500 in July. It is due to disappear completely on December 31.
The government believes the decline in sales will continue until at least next spring.
Finance minister Christine Lagarde and industry minister Christian Estrosi have asked local préfectures to offer more help to car manufacturers in financial trouble.
