The Government is to announce an extension to the car scrappage scheme following calls from industry for extra measures to boost manufacturing firms.
Ministers allocated £300m to the scheme, under which motorists receive a £2,000 discount to trade in cars older than 10 years for new models.
The money is expected to run out within weeks, prompting recent calls from industry groups for an extension.
Business Secretary Lord Mandelson will include details of the extension in his speech to the Labour Party conference in Brighton later today.
It is understood that owners of vans will be able to trade in for a newer model after eight years, rather than 10 years.
The original scheme was estimated to lead to 300,000 cars being scrapped but, under the extension being announced later, that figure could rise to 400,000.
The move will be warmly welcomed by industry groups and trade unions, which have joined forces to praise the scheme and call for an extension.
