Earlier this week Toyota announced its own scrappage scheme, with motorists offered between £2,000 and £4,000 off when trading in their old model for a new Toyota.
A similar trade-in scheme exists in Germany.
Two years ago, it was revealed that Volkswagen had cheated emissions tests that affected 11 million vehicles worldwide.
Automaker Nissan is offering a scrappage scheme for customers to switch to all-electric Nissan LEAFs, while fellow Japanese automaker Toyota and German manufacturer Volkswagen (VW) have also entered the diesel scrappage market.
Auto manufacturers have been under increasing political pressure, especially in Germany, to encourage consumers to buy less polluting cars.
If drivers opt for its electrified models, they will also benefit from the government's £4,500 grant for low-emission vehicles, meaning customers could save as much as £10,000 on one of VW's new £32,000 e-Golfs.
VW launched a more generous scheme in Germany in August in the wake of its diesel emissions scandal.
Volkswagen's electric vehicle and plug-in hybrid models are also included in the deal.
The scrappage part exchange must be Euro 4 standard or older, have been registered by 31 December, 2009 and owned in the customer's name for more than 90 days.
"We've seen a bit of a drop in the United Kingdom auto market this year after years of really accelerated growth".
Between £1,800 and £6,000 can be had off the price of a new Volkswagen, depending on model, which all meet the latest emissions limits that came into force in September 2014.
However, he said it would also be important to VW that its United Kingdom competitors have similar schemes running, and VW will probably have pitched their discounts at that level in order to compete.
According to commentators though, VW's United Kingdom scheme fell short of the terms offered to drivers in its home market.
The offer covers nearly all Toyota passenger cars and light commercial range, from the Aygo city auto to Land Cruiser and Hilux.
He added that by matching rival offerings VW will probably keep its advantage over its opposition.
While most of the manufacturers offer a flat £2,000 off a new vehicle, half of buyers questioned on the schemes said they wouldn't consider anything less than £3,000, while one in six said it would take at least £7,000 to tempt them into something newer and cleaner.
Paul Van der Burgh, Toyota GB president and managing director, said: "Our scrappage scheme is a win-win solution".