11 July 2019
In line with EU emissions legislation, all commercial vehicles registered from 1 September 2019 must comply with Stage 6.2/WLTP emissions rules.
Despite all the controversy around emissions over the last few years the Government and EU continue to tighten emissions regulations. This is having some unwelcome and unexpected practical effects on cash flow for retail dealers selling commercial vehicles – so pretty much all of them. The latest seemingly innocuous little tweak up from last year 6.0/WLTP to 6.1/WLTP and now to 6.2/WLTP could leave the industry with new vehicles obsolete at the end of August – that’s actually scrap. How is it then, that legislators appear to make these changes without much thought to the manufacturing pipeline, and sales lead time. Reducing emissions seems like a good idea but why pursue it in a way that could create so much disruption? If introduced with enough notice the transition could be smooth, likely creating less economic and environmental problems.
Of course, the industry will deal with any problems by registering the vehicles – which seems logical except the small cursory detail that the retailers will then have to pay for said vehicles. While this may not elicit a great deal of sympathy from some quarters these types of businesses are not exactly unburdened by debt. Indeed usually they are already very highly geared. Suddenly having to pay for 50 vehicles at £25,000 to £30,000 a pop is going to smart a little.
Naturally retailers have complained pretty bitterly about this and are trying to agree with the Government that 10% of their annual predicted sales can be sold after August 2019 but before August 2020. Whilst likely to be approved, the clock is now ticking rather loudly. With all the challenges the sector faces, this adds to the pile somewhat. No doubt most retail dealers will be asking the question at which point the next tweak will come and be planning around it. I am led to understand the last transition was much more chaotic from 6.0 to 6.1 with some German manufacturers particularly caught out.
So what possible silver lining could there be? Perhaps good news for the consumer? (providing they can live with their conscience by owning a 6.1 not 6.2). It is likely that around the end of August there will be some bargains to be had across the patch. Maybe even this will help drive trade and activity to the retailer's doors. As ever a balance is to be struck but if you run any commercial vehicles, I would be seeing what bargains are around at the end of next month!
If you are involved in the automotive industry and would like any advice on this matter and others that may affect your business please contact one of our specialist automotive sector team.
