Car Scrap Scheme Terrific Waste of Money and Resources


Photo of crushed car parts via Oosoom @ Wikipedia.

In January when the German government quickly implemented a car scrap scheme that pays motorists 2,500 euros ($3,328) to trash cars more than nine years old and buy new ones, other governments were full of praise - France and Italy followed, and the US, UK and now Spain have similar plans. But has this anti-recession measure done any good?Cash for clunker an expensive proposition
In the very short term, yes. Car sales shot up 40% for the first quarter, but now overall retail sales in Germany are falling. That jolt to the economy may also cost the German government up to 5 billion Euros, while next year an auto buying slump is expected since prospective buyers already bought. Five billion euros could certainly buy a lot of bike, pedestrian and public transport improvements.

Perhaps most egregiously, still-good cars are being scrapped at an alarming rate (the law specifies the cars must be scrapped and not resold) while scrap metal prices have plunged. Here's the kicker: estimates say 3 of 4 new car buyers would have bought anyway. Now, what was the good side?

Scrapped is just another way to say "trashed"
Yes, cars are highly recyclable - in the U.S. the latest figures are that 84 percent (by weight) of a car is recycled, and 95 percent of cars go through the recycling process. End-of-life vehicles are our most recycled consumer product. But wait.

According to the UK's Environmental Transport Association, the Organisation for Economic Cooperation and Development found that

"these schemes have a high average cost per ton of pollution avoided, and do not compare favourably with other alternative policy tools on purely environmental grounds."

In fact, in a column, George Monbiot quotes a 2000 study from the journal Transportation Research that shows that while local pollutants (such as NOx and CO) may decline when scrapping is introduced; production and subsequently life cycle energy use and CO2 increase.

As the ETA itself says:

"Car scrapping schemes are good for boosting new car sales — they have very little to do with the environment and to suggest otherwise is not just greenwash, it is hogwash."

Specifically in Germany's scheme, someone could trade in a Volkswagen Lupo that creates 81 grams of CO2 per kilometer, and buy a 2009 Porsche Cayenne that makes 358 grams of CO2 per kilometer.

Is the bright side a bike scrap scheme?
One city in Germany had a bright idea. While not condemning the car scrap scheme, the city of Mannheim partnered with Biotopia to offer a bike scrap scheme as a way to get people out of their cars for short trips and onto their bikes. That 50 Euro rebate started last weekend, and the ETA says a similar bike plan should be added to the UK scheme. However, the bike scrap will have no appeal to a car owner that's never had a bike, while conversely, those cyclists who have bikes might possibly not want to trade.

In the end, scrapping incentives, says Eric Regully in Report on Business, "are a classic case of buy now as a consumer, pay later as a taxpayer hocus-pocus."

Perhaps the US and the UK should slow down and think about these downsides before going ahead with scrappage schemes. Via: BBC
Read more about car scrap scheme
Old Car Scrappage Incentive Announced in UK
Bike Bonus: In One German Town You Can Cash in on Car and Bike Swaps

Tags: Driving | Germany | Transportation

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