This was one of a series of projects which developed and enhanced the Vehicle Market Model for the UK Department for Transport.
Research and development of a model which could be used to predict which part of the existing vehicle fleet would survive from year to year and which part would be scrapped.
The following methodology was applied:
- Literature review of scrappage models;
- Derivation of a 'core' survival rates from data;
- Stated preference surveys of car and Heavy Goods Vehicles (HGV) owners to elicit information about intentions to scrap and replace and the factors affecting these decisions;
- Development of a computer model.
The key results of the project are as follows:
- Derivation of 'core survival rates' for petrol cars (by engine size), diesel cars and Heavy Goods Vehicles (HGVs) (rigids and artics) all disaggregated by vintage.
- Development of a model, based on the results of a stated preference survey, which shows how survival rates for petrol cars, diesel cars and HGVs of different ages vary in line with:
- vehicle excise duty;
- new car prices;
- depreciation rates/second hand car prices;
- fuel prices;
- scrappage scheme.
This project has determined the main factors that influence owners' decisions when they scrap cars and Heavy Goods Vehicles and will improve the existing method of predicting scrappage rates within the Vehicle Market Model (VMM). The results of the stated preference survey aimed at eliciting preferences from owners, insurers and dealers will help identify how an individual’s decisions regarding car replacement may be influenced by Government policies such as the introduction of scrappage incentive schemes or graduated Vehicle Excise Duty. The project's outcomes will also improve modelling of the car fleet as well as allow more accurate modelling of various policy measures such as an accelerated scrappage scheme.