For a nation that loves its cars and whose economy relies heavily on selling them, it seems the perfect match. An "old banger bonus" offered to those willing to trade in their old cars for new ones has proved an instant success.
If Angela Merkel's Christian Democrats win September's general election, the Autowrack Prämie, introduced this week as part of a €50bn (£47bn) stimulus package, is almost certain to be given some of the credit. And if the car industry gets back on its feet within the next year the bonus will be seen to have been a contributing factor.
The €2,500 bounty being offered to owners of cars of nine years or older willing to trade them in for new or nearly new models is meant to help the ailing auto industry at a time of need. Car sales have not been so bad for 20 years, largely because the credit used to buy them has dried up. Car workers are even being told not to turn up for work until the situation improves.
The government has put aside €1.5bn to finance the scheme – enough to buy 600,000 cars. But if the busy hotlines and the rising interest dealers have reported are anything to go by, the government may be forced to extend it. All indications are that more than a million car owners want to take part in the deal – and even that may be a conservative estimate. After all almost 17m of the cars on German roads are nine years old or more.
"We're hearing reports from the car industry that are sounding more than euphoric," Helmut Blümer of the Central Association of the German Motor Vehicle Trade (ZDK) told Die Welt.
Matthias Wissmann, president of the Federation of the German Car Industry (VDA), told Der Tagesspiegel: "This is the right measure to help ensure that a vital German industry doesn't fall to its knees."
According to a poll carried out by the accountancy firm Ernst and Young, the bonus is more than just a populist measure – it has the potential to crank up car sales.
A third of those planning to buy new cars have said they will make use of the state subsidy. About 9% of 1,040 people polled in a recent survey said they would plan to buy because of the bonus, which is available until the end of the year.
But some experts have issued a note of caution. Eighty per cent of the cars assembled in Germany by the main carmakers are exported abroad. It is the slump in exports that is hurting the likes of BMW, Opel, Porsche, VW, Audi and Daimler as well as the third of German electronic firms and the chemical and mechanical industry dependent on the car industry – in short, hundreds of thousands of jobs.
The car industry has nevertheless welcomed the move. So have consumer groups and scrap dealers. But though it may be possible to argue that the air will become cleaner through the scheme, environmentalists are not enamoured. The government says the bonus will remove older, polluting models from the roads onto scrap heaps where they belong. But Green party figures have said it will dissuade some who considered ditching their cars from doing so.
