Nissan asks Government for cash incentive to buy cars

Mar 27 2009 by William Green, The Journal

NISSAN is urging the Government to offer cash incentives to get consumers buying new cars amid warnings the automotive industry is facing “a state of emergency”.

The carmaker – which has a major plant in Washington – said the case for a “scrappage” scheme was supported by the news that it has enjoyed a boost in export orders after such a programme was introduced in Germany.

The developments come after Nissan announced it was cutting more than a thousand jobs in its local factory – with more workers made redundant in the supply chain – in the face of a global sales slump.

But industry sources fear the crisis could significantly worsen and leave the industry “hollowed out” and unable to compete internationally unless ministers takes decisive action now.

The Journal also understands there are industry “frustrations” that the Government has been too focussed on saving banks and not enough on the “real economy”.

And Chancellor Alistair Darling is now under pressure to use his upcoming Budget on April 22 to help the British automotive industry come through the recession.

The Society of Motor Manufacturers and Traders (SMMT) wants new car tax hikes dumped and a scrappage scheme to encourage consumers to get rid of old cars and buy new vehicles.

And the SMMT has suggested to ministers that owners of cars and vans over nine years old could be encouraged to scrap them by offering £2,000 towards new or one-year-old vehicles.