WLTP Results Tax Burden?
Vehicles re-tested under the new WLTP fuel economy cycle are recording “greater than expected” increases in CO2 emissions when figures are converted back to NEDC, JATO Dynamics has warned, adding that this will result in significant tax rises for fleets over the coming 12 months.
The World Harmonised Light Vehicle Test Procedure (WLTP) came into force in September, replacing the New European Drive Cycle (NEDC) and aimed at offering more representative fuel consumption and CO2 emission data for new vehicles.
Within 12 months, all new cars will have to be re-tested to produce WLTP data, except those which are due to be discontinued. WLTP is expected to result in CO2 increases of around 20% compared to NEDC figures.
However, as taxation and the EU’s fleet-wide CO2 target of 95g/km are both based on NEDC figures, there’s a crossover period where both sets of data will be required. All new vehicles will be WLTP-tested, and converted to ‘NEDC correlated’ fuel economy and CO2 emissions using a tool called CO2MPAS. In the UK, these simulated NEDC figures will be used for vehicle tax.
Analysis from JATO, published in a new white paper, has shown this could be problematic. The first NEDC correlated figures are up to 18% higher than the genuine NEDC fuel economy and CO2 emissions from earlier this year.
In turn, that could mean up to a five percentage-point Benefit in Kind increase for drivers compared to an identical vehicle registered a few months ago.
JATO also warned that this could make the 2020 95g/km CO2 targets very difficult to meet, placing greater reliance on electrification: “The automotive industry would need fully electric vehicles to account for 15% of the market in 2021 in order to meet the 95g/km CO2 target. This is striking considering that the current level of fully electric vehicles registered in the EU is 1% of the market.
“It’s clear change needs to happen, considering the combination of the current trend of declining demand for diesels and the reduced diesel offerings from automotive companies, as well as the growth of the SUV segment and the slow progress of electric vehicles in the industry.”
Source: Fleet World Group
Added: 16th November 2017