Harder road ahead to hit lower CO2 targets with tax changes, diesel dilemma, buying habits

The motor industry has challenging CO2 cut targets and it�s going to get harder. Picture: Newspress

The motor industry has challenging CO2 cut targets and it�s going to get harder. Picture: Newspress - Credit: Newspress

The UK has hit lower CO2 emissions targets for the 19th year but changing buying habits and tax changes is going to make it harder in future.

The UK automotive industry has once again beaten CO2 targets, with average new car emissions down for the 19th year running.

The annual Society of Motor Manufacturers and Traders (SMMT) New Car CO2 Report 2017 reveals carbon tailpipe emissions fell to an all-time low with new cars averaging 120.1g/km last year. This beats the previous year's record by 1.1% and 2000 levels by a third (33.6%). Average new van CO2, 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 is thanks to billions of pounds of investment in new advanced engine, fuel and battery technology, as well using more lightweight materials such as aluminium and composites. The growing alternatively-fuelled vehicle (AFV) market and the shift of consumers towards diesel cars, which emit on average 20% lower CO2 than petrol equivalents, have also been critical to this success.

The industry has achieved tremendous gains, but changes in consumer buying behaviour away from diesel last year have caused the rate of progress to slow. UK motorists registered a record number of diesel cars last year but market share for this fuel type fell by 0.8%.

Although the UK now has Europe's largest market for zero emission capable cars, accounting for almost a quarter (23.8%) of EU electric and plug-in hybrid registrations last year, the growth in AFV demand has slowed, from 40.3% in 2015 to 22.2%. And the preference for sport utility vehicles over smaller cars continues to make progress on CO2 reduction harder.

If these trends continue, the UK's contribution towards the EU target of 95g/km average CO2 in 2021 will become tougher, requiring a 20.9% cut in CO2 emissions over the next five years.

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Of great concern is the current anti-diesel agenda, which fails 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 changes to vehicle excise duty (VED) next month with a standard £130 a year for hybrids and £140 for most new cars after the first year, with a £310 surcharge for five years for cars over £40,000 could hit low-emissions vehicles and the take-up of more expensive hydrogen fuel cell and plug-in hybrids.

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 AFVs – 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.'