LONDON - Britain's car scrappage scheme, which aims to revive demand for new vehicles by offering a discount to owners trading in old models, has made a promising start, car dealer Inchcape said.
"When the scrappage scheme was introduced, we saw an increase in traffic," chief executive Andre Lacroix told Reuters on Wednesday. "It is looking promising."
Britain introduced the scheme, which offers a 2,000 pound (S$4,805) discount on new purchases when motorists trade in a vehicle more than ten years old, last month. Around 60,000 cars have been sold under the scheme, out of a maximum of 300,000.
Lacroix said there were also signs of improvement in Britain's used-car market, but across the group - which trades in 26 countries - there was little sign of recovery.
"It's not getting worse but it's not getting better," he said in a telephone interview. "There's a stabilisation of trading at a much lower level (than last year), but we're not seeing any recovery."
Earlier on Wednesday, Inchcape said second-quarter profit would be well ahead of the first quarter, though down on the 2008 period, helped by cost cutting.
Lacroix said he would not be surprised if analysts increased full-year profit forecasts, but declined to give any guidance.
"Given the fact that we are seeing a strong second quarter I wouldn't be surprised if there is a bit of an upgrade in our consensus, but we will see," he said.
At 0805 GMT, Inchcape shares were up 9.2 per cent at 17.75 pence.
Investec analysts raised their full-year pretax profit forecast by 20 million pounds to 93 million.
