National Caravan Council Budget response

Wednesday, 22 April 2009 12:00 AM

The NCC (National Caravan Council) does not believe that the government's introduction of a scrappage incentive scheme to kick-start demand in the vehicle market will have an effect on the sales of new motorhomes. Currently motorhome registrations are down 37 per cent. However, because the vehicles hold their prices so well, it is unlikely that a £2,000 incentive will be attractive.

Around half a million cars are used for towing caravans, but only a small proportion of those are over nine years old and worth less than £2,000.

Director General of the NCC, John Lally, said: "The majority of motorhomes are still on the road at 10 years old. Because a significant proportion are diesel and their average annual mileage is usually considerably lower than that of a car or van, at that age they still have a long and useful life ahead of them. We need to know more details of how the 50 per cent funding from participating manufacturers will work. How can this be applied by small converters of motorhomes?

"We may see more fuel-efficient and greener towcars purchased by caravan owners, but the NCC would have liked to see additional incentives - such as VAT reductions - to boost holidaying in the UK. Even towing with a large, older-engined car creates less CO2 emissions than flying, as can be seen on www.greencaravanning.co.uk.

"The industry is also concerned about the effect the continuing rises in fuel duty may have on tourism businesses such as caravan parks in remoter rural areas. These businesses, heavily reliant on tourist spending, were adversely affected following last summer's hike in fuel prices."

The NCC was disappointed to discover that moves to improve the situation regarding trade credit insurance will apparently only apply to businesses suffering reductions since 1st April 2009.

The NCC however welcomed the various boosts to the housing market, which should assist the sales of caravan holiday homes and residential park homes. These are often purchased by 'empty nesters' who downsize and use the proceeds to fund a holiday home, or release equity and move to a park home.

The extension of help for loss-making companies, and the doubling of businesses' main capital allowance rate (to 40%) have also been welcomed.

Ends

Editors notes:

. The NCC is a not-for-profit organisation that represents caravan, motorhome, caravan holiday home and park home businesses in the UK. It represents approximately 800 outlets.

. The UK caravan industry is estimated to be worth in excess of £6 billion p.a. (sales of new/pre-owned products and holiday spend). It employs more than 90,000 people (including seasonal staff).

. There are 500,000 touring caravans in use in the UK. Of the 164,000 motorhomes in use, more than half are over 10 years old. These would be eligible for the scrapping scheme, providing they fall under the 3.5 tonnes limit and other conditions are met.

To read the BERR press release on the vehicle scrapping scheme, see
http://www.newspress.co.uk/DAILY_LINKS/arc_apr_2009/220409dberr.htm

Trade credit insurance was discussed in a recent meeting between the NCC and Lord Mandelson, see NCC Website for details.

Press contact: Louise Wood, NCC Director of Communications, tel: 01252 796064, email: louisew@nationalcaravan.co.uk, mobile: 07887 562333

More information at www.thecaravan.net.

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