Car scrapping bonus to be extended until year's end

The German government is planning an extension of its popular Abwrackprämie, or scrapping premium, until the end of the year, a spokesperson said on Monday.

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“It will be guaranteed that everyone who applies within the valid time period will receive money,” spokesperson Ulrich Wilhelm said in Berlin.

The programme, which offers Germans €2,500 to junk their old car and buy a new one, was initially allotted €1.5 billion, enough for 600,000 applications. But since it began in February after being approved for the German government’s second economic stimulus package, two-thirds of that sum have been spoken for.

“I haven’t the slightest indication that the terms would change,” Wilhelm said. Eligible applicants will get their money even if the number of applications exceeds the existing €1.5 billion cost, though Wilhelm said that there is no sign that the allotted budget wouldn’t be sufficient.

German Chancellor Angela Merkel and Foreign Minister Frank-Walter Steinmeier said last week that they would consider extending the scrapping bonus due to its “great success” in helping the nation’s ailing auto industry. Car sales have reportedly increased significantly since it came into effect on February 20.

Meanwhile, the online application system for the €2,500 bonus crashed on Monday – it’s very first day – according to German weekly magazine Der Spiegel. The problems were associated with “difficulties loading and filling out the reservation application,” the magazine said.

“We are having trouble with the system.” Federal Office of Economics and Export Control (Bafa) spokesperson Holger Beutel told Der Spiegel. The server wasn’t overloaded, rather “ a bottleneck in the Internet somewhere that we’re trying to root out,” he said.

The crash occurred despite comments by a spokeswoman for the economics ministry that the server was stable and equipped for 1,000 applications per second.