VW profits from scrappage scheme as manufacturer talks of electric future

27 September 2017

Online vehicle sales portal Carwow has found that Volkswagen (VW) and Opel are the main beneficiaries when it comes to the current vehicle scrappage schemes in place in Germany.

The company has found that VW is currently creating a lot of interest through its channels, with requests having almost quadrupled since the announcement of the environmental bonus. Meanwhile, Opel, recently acquired by PSA Group from General Motors (GM), has seen requests doubling, along with SEAT, Audi (Both VW brands) and Hyundai.

The environmental incentives are part of a package put together by manufacturers in Germany to alleviate the pressure on the diesel industry, following the VW scandal of 2015. These include a recall of around 5.3 million Euro 5 and Euro 6 vehicles for software upgrades to alter their emissions profiles, and a scheme to take even older diesel cars (and in some cases petrol) off the roads too. A similar scrappage plan is being used by manufacturers in the UK to boost sales, which have been lagging in recent months.

The incentives offered by car makers are not too dissimilar. For example, in the compact segment of the market, almost all brands offer a premium of €5,000, according to Carwow’s analysis. Only Mazda and BMW offer less than this, which has affected requests for information on these brands negatively.

VW however, has seen not only interest in the brand rise, but also sales through its platform, with registrations increasing by 260%. However there were no other figures offered on other marques. The news is a boost for the Wolfsburg-based manufacturer, which has been seen as the catalyst for the ′downfall’ of diesel.

In an interview with Automobilwoche, VW head of sales Ulrich Selzer has suggested that the diesel engine remains the best option for car buyers in the country.

Speaking about the company’s hopes with its scrappage scheme, Selzer says: ′Our focus is on getting old cars off the road. Then we plan to enable our customers to switch to modern drive technology. That’s why we were thinking about how to get the new technology to the price of a ′normal’ Golf, because we also have quite ′normal’ German customers with normal income. This is not just about money, but also about making a statement about how we will tackle the future. This is not a sales campaign, but we really want to collect the old cars and get them out of the way, because they have to be scrapped within a month.’

The company also believes that the future of the automotive industry, and its own business, is electric. ′We want to play a decisive role in the future. Our goal is to sell 100,000 vehicles of the I.D. family [VW’s new electric sub-brand] worldwide in 2020,’ states Selzer. ′This means a five-digit number for Germany. For the year 2025, we are already aiming for one million I.D. cars worldwide. We can already offer the customer the chance to go electric and switch to I.D. today: If you buy or buy an e-Golf today you can drive it for three years and then switch directly to the I.D.’