What is life like with your car? Let us know and win £500 in John Lewis vouchers | No thanks

Scrap muddle

As the proud owner of a 19-year-old Renault 5 1.7 I was interested in the new initiative that might tempt me to sell our old car. I have read that the Citroen C1 is quite a good, cheap city car so checked it out with a couple of dealers in the North West. The basic model seems to have a manufacturers price of £7,795 OTR whereas dealers have been advertising the car at a discounted £6,395 for the past month. Therefore I thought that after taking into account the £2k scrappage initiative I might have to pay £4,395. Wrong. Both dealers informed me that the discount comes off the manufacturers price, hence I could buy one for £5,795. This seems rather peculiar given Citroen were able to offer it for sale for only £500 more before the Budget announcement. Does this mean that Citroen claims £1k back from HM Government but only gives a £500 additional discount for the car. Nice business if you can get it.

Asked on 6 June 2009 by

Answered by Honest John
No, it means that because the scrappage scheme puts people into the cheapest cars, demand and supply means that the cheapest cars ultimately become more expensive. Realistically, Citroen could not have afforded to supply a C1 for £4,395. The company already sells cars to the UK at a 20% less than Euro prices. And it isn’t going to sell cars at a loss if it doesn't have to.
Dear Honest John,

Please help me choose my next car. I would like it to have:
    Select a few terms below
Similar questions
My wife is in the process of changing car and she has driven both the Toyota Yaris 1.3 5 door and the Honda Jazz 1.4 both new. She is using the scrappage scheme and although the Toyota is the best deal...
Following your advice we bought a Hyundai i10 under the scrappage scheme last July. Today we had a 'phone call from the salesman offering us a new i10 in p/x for our old one and it would only cost us £499,...
I have been advised to write to you for some advice, my wife and I decided to purchase a Smart car during 2009 and wished to take advantage of the scrappage scheme, our old car was first registered on...
 

Value my car

Save £75 on Warranty using code HJ75

with MotorEasy

Get a warranty quote

Save 12% on GAP Insurance

Use HJ21 to save on an ALA policy

See offer