Answer to Parliamentary Question: scrap premiums for trading in old cars

Publication date: 25 May 2009

ORAL QUESTION H-0258/09 by Saïd El Khadraoui to the Commission

Subject: Scrap premiums for trading in old cars and buying new ones

In recent months, a large number of Member States have introduced temporary schemes for premiums to take old cars out of circulation more quickly and replace these with new greener vehicles.

Can the Commission provide an overview of the impact of scrap premiums in the countries in which they have been introduced? What is the effect on the sale of new cars? Which types of cars are purchased most often with these premiums? What are the environmental characteristics of the cars purchased with these premiums?

Can the Commission give an estimate of how many old cars have been scrapped as a result of these premiums? How old are the cars traded in? What are the environmental characteristics of the cars traded in?

Does the Commission intend to take legislative action to establish a framework for scrap premiums? What other initiatives has the Commission already taken with respect to scrap premiums?

What impact do scrap premiums have on the environment? Do they simply speed up the purchase of new cars, or do they improve the quality, efficiency and environmental impact of the cars in circulation?

Reply to oral question H-0258/09 by Mr El Khadraoui May 2009

The Commission considers that demand-side measures such as scrapping schemes can play an important role in promoting fleet renewal and the replacement of older, more polluting cars with newer, technologically, more advanced vehicles. Therefore the Commission has welcomed relevant Member States initiatives while ensuring that these schemes are in conformity with the Community legislation.

Measures concerning demand-side which aim at improving the demand for new vehicles and assisting with the scrapping of older ones are foreseen by the European Economic Recovery Plan[1] adopted in November 2008. This Recovery Plan sets out the key elements of the public support for the automotive sector.

On 16 February 2009 the Commission invited Member States experts for an exchange of best practices in relation to scrapping schemes. Consequently, on 25 February 2009 the Commission has adopted "Guidance on scrapping schemes for vehicles" as part of the Communication "Responding to the crisis in the European automotive industry"[2]. In this paper the Commission has indicated its willingness to strengthen the coordination of national measures with a view to ensuring full effectiveness of the measures and prevent distortion of the Internal Market. The guidance paper gives practical guidance to Member States on how to design scrapping schemes for vehicles and explains the relevant Community legislation. Moreover, Member States have been invited to always notify their scrapping schemes to the Commission in the interest of transparency. The Commission committed itself to assess the schemes quickly and to verify compliance with Directive 98/34/EC[3], which requires notification of technical regulations at a draft stage. The Commission, therefore, does not currently intend see any necessity for legislative action to establish a framework for scrap premiums at this point of time.

Currently, 10 Member States have scrapping schemes in place and 2 more have announced their prompt introduction in the near term. It is worth remarking that the characteristics of the existing schemes vary, especially with regard to the conditions for the minimum age of the vehicle to be scrapped (from 9 to 15 years) and the requirements for the vehicle to be acquired (i.e. Euro emissions, CO2 emissions, maximum mileage).

It is too early to assess the overall efficiency of these schemes. However, based on the available information, these schemes have proved to be successful in some Member States with positive spill-over effects to other Member States. The smaller decline of passenger car registrations in Europe recorded in March 2009 has been attributed to the scrapping schemes. Also in March 2009, in some Member States, these incentives boosted sales significantly compared to the same month last year (Germany by 40 %, Slovakia by 18 %, France by 8 %). It is also reported that the schemes increase demand for more compact, environmentally friendly and fuel-efficient cars. However, no systematic assessment is available regarding the impacts on average CO2 emissions or air pollutant emissions.

[1] COM(2008) 800 final

[2] COM(2009) 104 final

[3] OJ L 204, 21.7.1998

Source: European Parliament