Motor industry proposes recycling compromise

Motor Industry leaders will today put a compromise deal to the Government designed to break the deadlock over the recycling of old cars.

Motor Industry leaders will today put a compromise deal to the Government designed to break the deadlock over the recycling of old cars.

The end of vehicle life directive, which comes into force next year, will force car manufacturers to become legally responsible for scrapping vehicles when they are no longer roadworthy. The new law could cost the industry £450m a year.

More seriously, the motor industry claims it could bankrupt manufacturers such as MG Rover, which will have to account for their liabilities on their balance sheet.

The Society of Motor Manufacturers and Traders is expected to propose a compromise whereby the last owner of a car is required to take it either to a vehicle dismantler or crusher, which will then issue a "certificate of destruction" that will enable the owner to stop paying road tax on the vehicle.

SMMT executives are due to give evidence to MPs on the Trade and Industry Select Committee this morning and industry sources say the compromise solution will be outlined then.

The Retail Motor Industry Federation and the British Metals Recycling Association are also set to give evidence before the select committee.

Dismantlers would be able to accept or reject a car but vehicle crushers would be required to deal with any car brought to them for a transitional period up until 2007. After that, manufacturers would take back any car which a crusher could not make money on.

The new law applies only to new cars initially, but after 2007 manufacturers would be responsible for every car they ever sold. That would also pose problems for long-established manufacturers such as Ford and Vauxhall.