Ford for incentives to owners to scrap old cars to boost sales

March 10th, 2009 - 1:46 pm ICT by IANS  

Toronto, March 10 (IANS) Ford Motor Company has asked the Canadian government to give monetary incentives to people to scrap old cars to boost sales of new vehicles.
Incentives for owners of 10-year or older cars to scrap them will boost sales of new cars, and thus save the ailing auto sector, Ford Canada president David Mondragon told a parliamentary sub-committee in Ottawa Monday.

The company president suggested that Canada should provide a $3,500 incentive to owners of each 10-year or older vehicle to scrap them.

Currently, Canada offers $300 for scrapping 10-year or older vehicles under its national car scrapping programme. Higher incentives, the Ford Canada president said, under the current scrapping programme will boost sales of new vehicles and help revive the auto sector.

Mondragon told the Canadian lawmakers that Germany has boosted its vehicle sales by 22 percent by giving high monetary incentives.

There are about five million vehicles on Canadian roads that were assembled before 1996. These vehicles, the Ford chief said, generate 12 to 18 times more air pollution than new vehicles.

He said he expected the vehicle sales to fall by $20 billion this year. The big three American auto companies - Ford, General Motors and Chrysler - manufacture 20 percent of all their vehicles in their Canadian plants.

Canada has announced a $4-billion bailout for the three US auto companies - in proportionate to the US bailout package. GM Canada will get about $3 billion, with the remaining one billion going of Chrysler.

Ford Canada has said it will not avail of the bailout package.

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