Global Update


The Association of European Vehicle Manufacturers (ACEA) is calling for European policymakers to implement a European-wide scrappage program to include incentives for owners who trade in cars at least eight years old. The association of 15 European automakers—which includes the European operations of General Motors and Ford—has announced its plans to forward a formal request for taxpayer-financed incentives to European policymakers. 

The ACEA issued this statement: “A scrapping scheme for older cars is a further important way of accelerating the take-up of fuel-efficient technologies and renew the car fleet on Europe’s roads, which has a clear environmental benefit. In the EU15, cars older than eight years represent 36% of the existing fleet. Their replacement with new cars would result in CO2 savings of 20 megatons per year or 4.5% of total passenger-car emissions. There would also be a significant reduction on emissions of nitrogen oxide and particulate matter.”   

European car companies are also expected to ask the European government for taxpayer-financed low-cost loans (expected to cost €40 billion Euro; $55 billion USD) citing the recently passed taxpayer loan package approved by the United States Congress to benefit the Big Three.

Sergio Marchionne, chief executive of Fiat, noted in a recent interview with Bloomberg News, "We've seen that the U.S. industry is now getting $25 billion worth of support in terms of financing. It would be absolutely necessary that the European Commission do exactly the same thing. It was $25 billion for the United States; in our case it's €40 billion because we have twice the capacity." 

Declining car sales (down about 16% in August) as well as expected high costs to fund product development to meet European-mandated CO2 reductions to be phased in by 2012 are among the factors cited by the car companies in announcing their intention to seek funding. European government officials have noted that they have not yet received a proposal from the ACEA and thus will not comment until they receive that request.

SEMA members that would like updates as they become available are encouraged to e-mail to Linda Spencer at and request future e-mails regarding a possible European scrappage program.