Government officials have “no understanding of the difference between economy testing and exhaust emissions.”

“European brands and Japanese brands that come to New Zealand are made for the Australasian (read Australian) market. Australia does not accept nor require WLTP testing and will not for some time,” says the Motor Industry Association’s David Crawford.

JUST four percent of new cars presently on sale won’t be jeopardised by emissions legislation if it enacts as Government intends.

The organisation representing new car distributors, the Motor Industry Association, is alarmed emissions and fuel economy assessment fundamentals appear misrepresented in official consideration.

Process to bring the Clean Car Discount and Clean Car Standard into action from January 1, 2022, which began in Parliament last week with first reading of the Land Transport (Clean Vehicles) Amendment Bill, has elevated industry concern.

The cited aim is to “achieve a rapid reduction in carbon dioxide emissions from light vehicles … (by) increasing the supply and variety of zero- and low-emissions vehicles, increasing the demand for zero- and low-emissions vehicles, and informing about vehicle emissions levels and rebates receivable.”

David Crawford says officials have “no understanding of the difference between economy testing and exhaust emissions” and is blunt about what will happen unless there’s a u-turn on some core thinking.

While a discount scheme has already kicked off, other elements rely on the Bill passing.

Not only civil servants are in the gun. The MIA has written to Transport Minister Michael Wood, but has yet to receive a response more than a week later, saying his comment in a Cabinet presentation on the subject is “causing confusion in the new vehicle sector and has potentially significant impacts for us.”

MIA chief executive David Crawford says much about the Bill suggests Government’s advisors are ignoring salient information the industry put to them months ago. It is also worried there is intention to enforce higher emissions targets than distributors were previously aware of.

Crawford said today officials have “no understanding of the difference between economy testing and exhaust emissions” and is blunt about what will happen unless there’s a u-turn on some core thinking.

“The headline will be ‘Bill prohibits at least 90 percent of new vehicles’.”

Government’s plan to implement Europe’s emissions standard and intent to uniformly deliver emissions counts calculated by the latest measurement tool, the Worldwide Harmonised Light-Duty Test Procedure (WLTP) continues to be of issue.

The cited aim of the clean vehicles legislation is to “achieve a rapid reduction in carbon dioxide emissions from light vehicles.”

The Euro 6d emissions regulation is the world’s toughest – a high bar for NZ, given it hasn’t had any particular regulations.

It starts here with a CO2 tipping point of 192 grams per kilometre; this so-called ‘ute tax’ – because those popular vehicle types are set to be uniformly hit – means anything above will be subject to penalty, topping out at just under $6000.

Those well below achieve a rebate already being paid out. For fully electric cars, that peaks at $8625. It is intended that revenue from penalties will replenish the rebates fund.

The emissions reductions are a tightening noose. The Clean Car Standard states that new passenger cars brought here from 2023 must have a CO2 rating of 145g/km or better, sliding downwards to 105g/km by 2025, and 63g/km by 2027. Utes and vans have less stringent targets, though 132g/km by 2025 is still well out of reach of any utility.

To give an idea how much improvement is needed, the fleet average at the moment is 171g/km.

Crawford says the industry keeps telling state advisors that these ambitions are simply an impossibility – yet the message just doesn’t get through. If anything, they’ve raised the stakes.

“The targets in the Bill for 2026 and 2027 are new, we have not seen these before. They are excessively aggressive and will either mean vehicles cease to be imported or heavy penalties will force the cost of new vehicles up.”

The MIA has now revved up.

“Officials did not understand when drafting the Cabinet paper for the Minister the linkage between vehicles exhaust emissions standards, fuel consumption testing protocols and vehicle source markets. The Bill as tabled in Parliament is, therefore, predicated on false advice.”

NZ’s new car uptake in any given year accounts for less than half a percent of the global car market.

The MIA believes Government’s advisors’ argument about NZ being up achieving EU6d rests on grounds that, because most new cars sold in Europe are from the same makers in Japan and Europe that also sell product here, there’s compatibility.

The MIA says that’s an over-simplification that shows a naïve understanding of how manufacturing operates and how the New Zealand market works, particularly in respect to historic sourcing arrangement with Australia.

NZ’s new car uptake in any given year accounts for less than half a percent of the global car market. Partnering with Australia, a much larger and more important market, gives us opportunity to access more relevant stock.

However, it also means we have accept cars tailored to meet a standard our neighbour’s requirements – and its Government’s ignorance of the implications of this that is causing issue now.

One concerns WLTP, which came into play in September 2018 as a way of achieving economy and emissions counts in test that are more closely reflective of those achieved when actually driving.

Our neighbour has put WLTP on a back burner and instead references a 1980s’ emissions methodology, NEDC (new European driving cycle), WLTP has rendered obsolete. Clean Car uses a formula that seeks to convert NEDC counts to a WLTP equivalence.

“Saying our major source markets are Europe and Japan only relates to where those brands originate from,” Crawford says.

“European brands and Japanese brands that come to New Zealand are made for the Australasian (read Australian) market. Australia does not accept nor require WLTP testing and will not for some time.”

The MIA has told Wood that the implication in his Cabinet paper that introduction of Euro 6 and WLTP testing can be done separately is “not accurate.”

Crawford says his members estimate at present just four percent of new cars sold here have WLTP compliance. Most also delivered to Euro 5 compliance, which is more lenient than Euro 6.

“This means come January 2022, over 90 percent of new light vehicles entering NZ will not be able to be tested using the WLTP testing protocol as these vehicles are homologated for the Australian market under Euro 5 or Euro 6b, which uses the NEDC testing protocol.

“I don’t believe the Government intends to exclude over 90 percent of new light vehicles from being able to be complied for entry into service come January, 2022.”

The Bill can be found here: https://www.legislation.govt.nz/bill/government/2021/0062/latest/LMS536377.html#LMS536334