Tuesday 16 July 2019

New-car emissions tax 'could cause sales to plunge - and those hardest hit will be buyers of family SUVs' - motoring expert

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Eddie Cunningham

Eddie Cunningham

WHILE much of the public focus has been on the electrification of our cars for the future, it is easy to overlook the fact that another, more immediate, decision lies waiting to be dealt with.

As you probably know, new cars' emissions are now assessed and taxed on the basis of readings under more stringent real-world evaluation.

It is called the WLTP test.

It has meant that even in its aggregated NEDC guise, quite a proportion of cars - around the 20pc mark, according to some sources - have shot up the VRT and road tax bands. Result? More VRT and road tax in many cases.

Such has been the extent of increase under the current interim NEDC system that there are fears of even greater rises when the full-blown WLTP data are applied from January next.

Just be aware: the cars are not polluting more. On the contrary, they have never been as clean. It is just that their 'real-world' consumption performance is being more accurately measured.

That's how the higher CO2 emission readings have come about and why so many are being pushed into more severe tax bands.

Now it is being forecast that if the Government doesn't do something about the current bands there could be huge price increases and a corresponding plunge in new-car buying.

According to one motor industry expert, sales could plunge by 45,000.

And he is forecasting that those hardest hit will be buyers of popular family SUVs.

Paddy Magee, country operations director for Renault in Ireland, predicts that many SUVs, such as his own brand's Kadjar, could go up by anything between €4,000 and €5,000 if the Government chooses to leave things alone on this issue in the Budget.

He says the new-car market could nosedive to as few as 55,000/65,000 in 2020. That would be a significant drop from the projected total for next year - and pose a real threat to thousands of jobs.

There are fears that a 'silent' stealth strategy will be followed by Government as the current 'green' drive takes hold and fossil-fuel cars become fair game - again.

Since the new more stringent WLTP emissions test system came in for all cars from last September, most vehicles have shown an increase in CO2.

The Government undertook to study the impact of the new system over the year and address it in the Budget after seeing how many cars were, or are likely to be, affected.

But now there are widening fears that they will extract exchequer revenue from new cars given the political sentiment - as outlined in the Climate Action Plan - to drastically lower the number of fossil-fuelled vehicles bought each year.

Mr Magee told Independent Motors: "There is a real danger this will happen. I have spoken with colleagues and the fear is real.

"There is also the real concern that a drastic lowering of car sales would mean jobs being affected."

The industry employs more than 40,000 at the moment.

"We need clarity on what is going to happen because the uncertainty is causing chaos," Mr Magee added.

Irish Independent

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