CO2 targets may not be front of mind at the moment but they’re still in place, with new tougher targets from the EU for this year and set to be mirrored in the UK in 2021.
Fleets and car manufacturers may simply be trying to become fully operational again as lockdown eases, but the lower, 95g/km CO2 target isn’t going away.
CALCULATE THE FORMULA
The formula to calculate each car’s CO2 target looks like this:
Target emissions = 95 + (a * (M – M0))
a = 0.0333
M = kerb weight and
M0 = 1.379.88kg
As an example, a car with a kerb weight of 1440kg would have a target figure of 97g/km, and one with a kerb weight of 1800kg would have a CO2 target of 109g/km.
Fines would then be calculated based on the difference between the target CO2 and official CO2. Fines have been set at €95 per g/km each car is over the target.
In our example, if the 1440kg car had an official CO2 of 117g/km then the fine would be €1,900 (20x €95). But if the 1800kg car had an official CO2 figure of 117g/km then it’s fine would ‘only’ be €760 (8x €95).
Under the new emissions regulations, 2020 is an ‘ease-in’ year with slightly softer targets. However, in 2021 things become tougher, not just Europe-wide, but specifically in the UK because the government is planning to run parallel legislation after we leave the EU.
The Department for Transport has already confirmed the rules will still apply next year even though the UK has left the EU.
A spokesperson for the department said: “The existing EU regulatory regime will remain law in the UK. From 2021 the intention is to continue with this existing approach but in a UK-only context. The Government consulted on such an approach in November 2018.
“Vehicle manufacturers registering new passenger cars and vans in the UK would be responsible for meeting the CO2 targets, as they are now under the existing EU regime.”
In this scenario only UK registrations will count toward compliance, so UK national sales companies cannot rely on averaging from other (potentially lower CO2) countries.
What has been difficult to judge is how far off the target each brand is – and so how big a fine each is facing. This is no surprise as the target isn’t set in advance, even thoughts talked about as being 95g/km.
The targets are based on actual cars registered in the year with a weight factor taken into account; heavier cars have a higher CO2 target and lighter ones a lower CO2 target – see box.
|Make||Number registered in 2019||Average mass 2019||Mass total||2021 target from 2019*|
While we don’t know the average weight of the cars that are going to be sold by brand for this year or next, a Freedom of Information request has revealed what they were for 2019.
This shows the wide variation in average vehicle weights and therefore in CO2 target from 82g/km for Smart to more than 136g/km for Rolls Royce. It is worth noting that this is a target without any adjustments for cars with CO2 figures below 50g/km – which have a greater impact on the target in the first few years than higher CO2 vehicles.
This is why calculating fines becomes more complicated; because of the small-print. For instance, brands are allowed to group together (to get a better average) and there are also a few ‘bonus points’ available to help make a target easier to achieve such as cars with CO2 figures below 50g/km (EVs and PHEVs) each counting as 2 in 2020 and 1.67 cars towards the average in 2021.
Brands with very small volumes are also likely to be either set easier targets or no target at all.
If you’re wondering what this will have to do with fleets, then look at the expected size of the fines.
Using the 2019 figures the target would have been approximately 97.9g/km (before any bonus points were taken into account), yet the actual UK CO2 new car average was 127.9g/km, according to the SMMT. That’s a 30g/km CO2 difference. With a €95 fine per g/km per new car registered, that’s fines of €6.56 billion in a 2.3 million car market, or €2,850 per car. This sum doesn’t take into account the multiplier for EVs and PHEVs, but at around 5% of the mix, there’s still some way to go.
If you’re a brand registering 50,000 new cars a year, such as Volvo or Citroen, at that average CO2 figure then your fine is €142.5m.
It’s for this reason car makers will ensure that their CO2 averages mean fines are avoided or at the very least kept to an absolute minimum. And to do this they will have to influence fleets into choosing cars which make the target achievable and having those cars available.
Citroen, Peugeot and Vauxhall parent company PSA, for example, has set CO2 targets for its fleet sales to hit so the average can be kept low, however this has the potential to disappoint company car users wanting higher CO2 models. Other brands have killed-off some high CO2 cars and others are limiting the numbers of higher CO2 models available.
Fleets may find that even if a large diesel-powered car is still the most suitable for a member of staff, if for instance they’re a high-mileage driver, that car may not be available or may have a particularly long delivery time.
If user-chooser drivers can’t get or don’t end up in the car they want, it could also impact staff retention levels and it won’t be the manufacturers that take the blame, it’ll be the employer.