Opinion: How the Government’s air quality strategy could hit used car buyers

Opinion: How the Government’s air quality strategy could hit used car buyers

Today’s announcement of the ban on new petrol and diesel cars in 2040 is big news, but should we be more concerned about councils’ ability to slap charges on owners of used cars?

The headline news from the announcement of the Government’s air quality strategy is all about the ban on the sale of petrol and diesel cars from 2040 onwards. 

What does this mean for the car you own and might want to sell in a few years’ time – and what does it mean if you can’t stretch to a new car, and only ever buy used?

The answer to that might seem to be ‘not much’. Petrol and diesel cars will one day become obsolete, that much is for certain – with or without legislation, that was always going to be the case, and there’s currently some debate as to whether the new rules will actually have any effect, or whether organic change will happen well before 2040 anyway.

But it isn’t that big, attention-grabbing headline that should be of most concern to used car buyers. More worrying is the effective licence the air quality strategy gives to councils to charge older vehicle owners for driving their cars into city centres.

Granted, the Government’s stance on this is that it should be used as a last resort – but given the seeming keenness of councils around the country to enforce this sort of legislation (no less than 27 British towns and cities have been given the go-ahead to create clean air zones, or proposed them), I wouldn’t bet against it.

While these charges will affect all owners of older vehicles, it’s likely that they’d be skewed against diesel cars, as per London’s T-Charge and Ultra Low-Emissions Zone (ULEZ) schemes. The former targets all cars that don’t comply with Euro 4 emissions standards, but the latter slaps an extra charge on diesel cars that don’t hit the newer Euro 6 regulations.

Already, used diesel values are roughly on a par with their petrol counterparts in certain classes of car, negating the idea that you’ll get back the extra you pay for buying a new diesel when you part with it. As we’ve already discussed, if this methodology is applied nationwide, there’s a strong chance it will hit diesel car values further, meaning drivers who currently own diesels may find they get far less than they expected when the time comes to sell them on. And if that is the case, the ubiquity of diesel models and paucity of their equivalent petrol versions will only exaggerate the switch in values. 

Here’s the dilemma that could face used car owners before too long if councils get their way: let’s say you own a 10-year-old VW Golf diesel, and your town introduces a ULEZ-type charge. Suddenly you can’t commute to your office in the town centre any more without incurring a £10 daily fee. Chances are you’re going to want to get out of that pretty quickly, either by selling privately or part-exchanging it. The problem is, everyone in your area, and indeed the whole country, has had the same idea; as a result, 10-year-old Golf diesels are now worth about 3p. 

What are your options? Do you decide to take the hit and buy a petrol Golf instead? Perhaps – but there are only two that look decent for sale nationwide, both are around 150 miles away, and in any case, they’re already sold by the time you phone up. 

Besides, your car’s value’s fallen through the floor, so you’re going to end up with an older, leggier or more tired example of the petrol model unless you can stick some more cash into the deal – and as the threshold for these emissions charges is inevitably rolled forward, you might end up having to stump up a daily fee of some sort in a year or two anyway.

What the Government would like you to do is trade up to a newer, cleaner, greener Golf – ideally an e-Golf. Problem is, now your diesel’s value is so low, it won’t cover the deposit. And if you could afford the monthly payments, you probably wouldn’t be driving around in a 10-year-old Golf anyway. Besides, as used values of older cars have fallen off, they’ve dragged depreciation curves downwards, and caused PCP and lease values – which are dependent on residuals – to nudge upwards, pushing them even further out of reach.

So realistically, you’ve little choice but to stick with your diesel Golf, taking the £10 hit every day, for foreseeable future at least – or until such time as you’re able to trade up to a newer Golf. Which is fine, until the Government then rolls forward the emissions charging threshold in an effort to push the last remaining internal combustion cars off the road as the drive toward zero-emissions gathers pace, when you find yourself in the same situation again.

Of course, the flipside to this is that if you never need to head into a city centre, a used diesel might soon be seen as a very cheap way of getting around. Not only will it be more fuel-efficient than the petrol equivalent, but road tax will be lower, too – at least, for as long as it stays CO2-based system.

What’s more, sprinting from suburb to suburb on a motorway, or providing enough range around the countryside at leisure, is the sort of driving at which diesel cars excel. And the flood of diesel-engined cars hitting the market as their owners realise it’s going to cost them an arm and a leg just to commute will give you a huge choice from which to take your pick. If that sounds like you, the market might be about to turn your way.

But for used car drivers who commute into cities with no viable public transport alternative and have no choice but to own older, more polluting cars, the only options will soon be to get rid at a loss, or simply to stump up those extra charges. The Government needs to think hard before allowing councils to force these drivers, who make up a large proportion of those on the roads, to take such a big hit so soon.

Read more: 

New petrol and diesel car sales set to be banned in the UK from 2040

Diesel engines: your questions answered

Is the EV killing the performance car?

The future of the car: an Autocar guide

Source: Autocar Online

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