Next year EV supply will be very different

  08 September 2019

CO2 target impacting EV supply

The latest new car registration figures highlighted an interesting trend; fewer plug-in cars have been registered so far this year, than last.

If you think about this, it doesn’t really make sense. There’s been so much talk about going green and long waiting times for any car you charge up, that surely sales should be increasing?

Well, according to Auto Retail Network sources there’s a good reason your customers will have to keep waiting for plug-in cars and it’s all to do with the CO2 target that manufacturers need to hit next year.

The current EU-wide target of 130g/km CO2 changes to a new 95g/km CO2 target in 2020. The target also includes a fine equivalent to €95 per car, per 1g/km, over the limit and covers all cars registered in 2020.

According to our sources, manufacturers are delaying deliveries of full EVs and PHEVs until 2020 as these vehicles will provide significant assistance in hitting the new tougher CO2 target and help to minimise fines. But as they don’t count toward the target if registered this year, there’s not point hurrying delivery.

Brexit plays a part in this too. The likelihood of a no-deal scenario for Brexit may have been reduced this week. However, if a no-deal Brexit does occur, it is expected UK national sales companies will still be expected to adopt the 95g/km and fines in parallel with the EU.

While €95 doesn’t sound significant against the cost of a car, when multiplied up on the CO2 and number of vehicles it could be significant. For 100,000 vehicles averaging 105g/km, the fine for manufacturers would be around €95 million. Depending on a deal with Europe, this may be taken at European level or directly to the UK national sales company.

But it’s not just that EVs have low CO2 that helps reduce the average. As part of the fines system, pure EVs count double toward the target in 2020, hence manufacturers’ keenness to register as many as possible next year.

So it looks like retailers will have to continue managing customer expectations until the start of 2020. But from January, expect the taps to open and plug-in sales rocket. And possibly low volume, high CO2 cars become less available.

 

Tristan Young

Editorial director

Auto Retail Network

imageTags: BEV, CO2, EV, PHEV

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