According to car finance news this morning, the UK car scrappage scheme has been extended for another month. Due to finish in February, the subsidy has now been extended until the end of March, although no further funds will be allocated at this stage.

The government, who ordered the extension, said that it would give both manufacturers and car dealers more time to prepare for the exit phase of the scheme. The car scrappage scheme has, according to many motor finance experts, been an essential part of keeping the car industry alive. Under the scheme, car drivers get 2,000 pounds off the price of a new vehicle when they trade in an car at least ten years old.

Business Secretary Lord Mandelson was reported as commenting: Against the background of the economic downturn the scrappage scheme has proved a great success, driving UK car sales, protecting jobs and supporting the supply chain for car manufacture at a time when this sector needed it most. If you're considering buying a new car, you should place your order as soon as possible to avoid disappointment, because the budget is strictly limited.