May 1, 2009 / 8:04 AM / 10 years ago

Pendragon sees little help from car scrap scheme

LONDON (Reuters) - The government’s car scrappage scheme, aimed at boosting sales of new vehicles, will have “very little if any” impact, the head of the country’s biggest car retailer, Pendragon (PDG.L), said on Friday.

“It’s not enough to make a material difference to customer behaviour,” Pendragon chief executive Trevor Finn told Reuters.

Last month, the government announced plans to give motorists a 2,000 pound discount on purchasing a new vehicle when they trade in one more than ten years old.

Finn said the problem was that the scheme is half funded by the car industry, which is already offering significant incentives to customers.

“Are the car manufacturers going to increase over and above their current incentives their incentives further? It’s very difficult to see how that’s going to happen,” he said in a telephone interview.

Earlier on Friday, Pendragon said it had secured a 530-million-pound financing package and reported a swing to an annual loss.

Finance director David Forsyth said the extra cost of the financing package compared with previous arrangements was about 10-12 million pounds a year.

However, Finn said the overall interest charge would be down year-on-year because of tighter stock management.

Reporting by Mark Potter; Editing by Dan Lalor

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below