Car Lease and the New Rewards Scheme for New Cars

Getting something for "nowt" is something that doesn’t came along that often within the world of politics within the UK, but that is what effectively has happened with a new scheme designed to reward and motorist who trades in a car over 10 years old for a new one. The government will gibe £1000 off the price of a new car, if you scrap your old one, then the manufacturers will give you another £1000, or so they say.

On paper it screams a good idea and with Germany scoring 40% increase in new car sales since starting this reward scheme, there should be no complaints, but of course there is. Take the car lease sector of the market. They are often responsible for 50% of all new cars sales in the UK, but this reward scheme is not applicable to new cars bought on a car lease policy. First the car has got to be owned by the current owner for at least 12 months before attempting to trade it in for the cash and it only applies to private sales.

The result being that car lease companies may lose sales, as many who were considering car lease now choose to buy to get that £2000 discount. In reality this still may not be many sales, as those who lease are by far mostly in the business car lease bracket and would tend to do this every few years anyway and would not have the 10 year old car to trade in.

For many business owners who do tend to have an ageing fleet of cars or even the one band who has an old van or old car, should now maybe consider getting something newer either to buy or to lease. The reductions on consumption of fuel has dropped considerably on many new models of cars, meaning that when you calculate you savings ion fuel over the year, especially for high mileage situations, you could be saving a huge amount towards the lease value and maintenance of the vehicle.

This is more applicable in Europe where the cost of fuel has always been higher than in the States. Those manufacturers who rely on gas guzzling vehicles may need to change their business models to suit the modern climate. The car lease market could be especially effective in the States where fuel economy is becoming more prevalent and USA car manufacturers are starting to disappear from the map, because fuel economy on the past had not been related to the main buying decision.

This does still leave the question of where to offload large cars that are just not in demand. The UK’s new road tax prices came into force this April, allowing some cars to be tax free but the large petrol models being charged an excess to compensate.

In the UK there is also the problem of off loading vehicles that nobody wants, so certain luxury models and 4 x 4s are now at an all time low, especially petrol models.

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