Russia Revives Car Scrappage Scheme

The Russian government will introduce a 10 billion-ruble (€206 million) plan on Monday to scrap old cars in an effort to revive the country's sagging auto market.

Car sales in Russia fell 10% in the first seven months of the year, including drops of 17% in June and 23% in July.

Russia offered a similar state-funded scrappage program in 2010-2011 that paid consumers 50,000 rubles to replace cars that were at least 10 years old. The program generated more than 600,000 vehicle sales.

The new initiative will run through the end of 2014 and subsidize the sale of about 170,000 vehicles, including buses and commercial trucks, according to the country's industry minister.

Discounts to scrap an old vehicle and replace it with a new one will range from 40,000 rubles (€825) for a car to more than 350,000 rubles (€7,200) for a commercial vehicle, according to the ministry.