Ford Canada Asks for Government "Scrappage" Plan

Colum Wood
by Colum Wood

Ford Canada is asking the Canadian government to put in place a vehicle scrappage plan like the one currently in effect in Germany.

Ford Canada CEO David Mondragon told a parliamentary committee that Ford isn’t looking for a bailout and instead suggested a plan that would include $350 million ($270 million U.S.) for a scrappage plan. The way the plan would work would be for the government to give cash incentives for people who trade in their old cars and purchase new ones.

Mondragon’s suggested solution would include an incentive value of $3,500 ($2,700 U.S.), for consumers to use against the price of a new car when they traded in their old one. The deal would apply to any car 11-years-old or older.

With 35 percent of cars on Canadian roads over 11-years-old, this could account for as many as 100,000 car sales.

In Germany, the rule applies to cars 9-years-old or older and so far has been a resounding success. While February sales in the U.S. continued to tumble, car sales in Germany for the month were actually up 21 percent over the same period the year before.

[Source: The Globe and Mail]

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