Page last updated at 19:21 GMT, Monday, 10 August 2009 20:21 UK

Scrappage scheme at half-way mark

A car being scrapped
Car scrappage schemes have helped to boost car sales in Europe and the US

Almost 155,000 new cars have been ordered through the government's scrappage scheme since it was launched in May, official figures show.

This means that more than half of the money set aside to fund the scheme has been spent.

Almost one-fifth of the orders were made in the South East of England.

Analysts say the scheme contributed to the rise in UK car sales in July, which was the first increase in monthly sales since April last year.

'Great deal'

Announcing the news, Business Secretary Lord Mandelson said the scheme was "a great deal for manufacturers and dealers, not to mention customers".

"The scheme has contributed to a 13.5% jump in car manufacturing," he added.

UK car sales rose 2.4%, to 157,149, in July compared with the same month last year, the latest industry figures showed last week.

But sales so far this year are still down 22.8% on the same period last year.

Under the UK scrappage scheme, a £2,000 incentive is paid to motorists who scrap cars registered before 31 August 1999 to buy a new car.

Half of the money is paid by the government and half by the car industry.

The government put aside £300m for the scheme, enough to fund 300,000 transactions.

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