Consumers most likely to benefit from the £2,000 incentive are those buying a city car or supermini, as the scheme will deliver at least a 20 per cent discount if the car's list price is £10,000 or less. The cheapest scrappage deal in the UK right now is on the entry-level Kia Picanto, says Which?, available at for £4,195, the equivalent of 32 per cent off. Elsewhere, Fiat is offering an additional £100 saving on top of the £2,000 scrappage incentive, taking the list price of the Fiat Panda 1.1 Active ECO down from £7,095 to £4,995 (30 per cent off).

For those looking to buy more expensive cars, buying second hand may actually be better value, says Richard Headland, the editor of Which? Car. "Don't assume just because you're getting £2,000 off a new car, you're getting a good deal. On cars less than £10,000, you probably are, but on more expensive cars, shop around for a bigger scrappage discount or check if buying second hand is cheaper. If so, it may pay to sell your old banger instead of scrapping it."