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Fleets lead CO2 emissions cut but SMMT warns anti-diesel agenda will halt progress

Fleets lead CO2 emissions cut but SMMT warns anti-diesel agenda will halt progress

Average new car CO2 emissions have fallen to a new low of 120.1g/km with fleets leading the way, according to latest data published by the Society of Motor Manufacturers and Traders (SMMT).

The figures reveal that average new car CO2 emissions fell for the 19th consecutive year. The ‘SMMT New Car CO2 Report 2017’ highlights that the 2016 figure beat the previous year’s record by 1.1% and 2000 levels by more than a third (33.6%).  

Average CO2 emissions for fleet sector new cars fell 1.3% to 118.3g/km last year (2015: 119.8g/km), which compares with 175.4g/km in 2000. Average emissions of new cars registered to private customers last year were 122.3g/km and those for businesses (sub-25 fleets) were 119g/km.  

Average new van CO2 emissions, meanwhile, fell 1.9% to a new low of 173.7g/km, ahead of the 2017 deadline for the pan-European target of 175g/km.  

The reduction was thanks to billions of pounds worth of investment in new advanced engine, fuel and battery technology, as well as increasing use of lightweight materials such as aluminium and composites, said the SMMT.  

The growing alternatively fuelled vehicle market and the shift of consumers towards diesel cars, which emit on average 20% lower CO2 than petrol equivalents, was also critical to the emissions reduction.

The industry had achieved tremendous gains, but changes in consumer buying behaviour away from diesel in 2016 caused the rate of progress to slow, said the SMMT. UK motorists registered a record number of diesel cars in 2016, but market share for the fuel type fell by 0.8 percentage points.  

Although the UK now has Europe’s largest market for zero emission capable cars, accounting for almost a quarter (23.8%) of European Union electric and plug-in hybrid registrations in 2016, the growth in alternatively fuelled vehicle demand slowed, from 40.3% in 2015 to 22.2% last year. Furthermore, the preference for sports utility vehicles over smaller cars continued to make progress on CO2 reduction much harder, according to the SMMT.  

If these trends continue, the UK’s contribution towards the European Union target of 95g/km average CO2 in 2021 would become tougher, requiring a 20.9% cut in emissions over the next five years, or 4.6% per year.  

Of great concern, said the SMMT, was the current anti-diesel agenda, which failed to distinguish between old models and the latest cleaner vehicles on sale and which could have a negative effect on future CO2 reduction progress.  

There are also fears that changes to Vehicle Excise Duty from April 1, 2017 could have a further negative impact.   

Under the new system, two thirds (66%) of the alternatively fuelled vehicles currently on the £0 standard rate will be subject to an annual flat charge of £130, in addition to varying levels of first year tax.  

Meanwhile, a £310 surcharge for five years for cars with a showroom price of £40,000 could affect demand for some of the lowest emitting vehicles - which were invariably more expensive than conventional technologies, said the SMMT.  

As a result, the organisation warned, take up of innovative technology such as hydrogen fuel cell and plug-in hybrid vehicles could suffer.  

Mike Hawes, SMMT chief executive,
said: “The automotive industry has some of the most challenging CO2 reduction targets of any sector and continues to deliver reductions as it has for nearly two decades.

“For this positive trend to continue, modern low emission diesels and alternatively fuelled vehicles such as plug-ins, hydrogen and hybrids must be encouraged with long term incentives. Turning our back on any of these will undermine progress on CO2 targets as well as air quality objectives. The UK has a successful track record in encouraging these new technologies but this must be maintained through a consistent approach to fiscal and other incentives.”  

The British Vehicle Rental and Leasing Association (BVRLA) welcomed the report and chief executive Gerry Keaney said: “More people are choosing to lease their cars, because it provides affordable access to a newer, cleaner, safer vehicle.  

“We are proud that BVRLA members are leading the way when it comes to reducing emissions - the average leased car added to a member’s fleet in 2016 emitted just 110.8g/km CO2, 7.7% less than the average new car sold in 2016.”  

But, he warned: “This trend of falling CO2 emissions could be about to end as the government goes in search of greater tax revenues, particularly from company car drivers.  

“Policymakers need to recognise that motoring and business car taxation is more than just a revenue stream. It can provide a powerful incentive for people and businesses to choose low-emission cars. With poorly designed tax incentives, the government could be putting the brakes on sales of low-emissions cars.”