Local policymaking ‘threatens to crash used truck market’

The UK truck market faces a potential perfect storm with a collapse in residual values for non-Euro 6 trucks predicted in 2020.

That’s the warning from Martin Flach, alternative fuels director at Iveco, who points to the introduction of the first five clean air zones outside London in 2019 – with Birmingham, Leeds, Nottingham, Derby and Southampton all being empowered to impose daily charges on all non-Euro 6 diesel trucks and vans.

This will coincide with the introduction of the London ultra-low emission zone (ULEZ), which Transport for London (TfL) says will impact on up to 60,000 vehicles a day (the current T-Charge impacts on only around 6,000), and non-compliant trucks and other heavy-duty diesels will pay £100 a day in contrast to today’s £10.

The following year, TfL plans to extend the ULEZ charge zone to the boundaries of the North and South Circular Roads.

Mr Flach estimates that by the end of 2020, there will still be 175,000 non-compliant trucks on the UK’s roads.

“The residual values of Euro 5 vehicles will go through the floor at that point,” he warns.

But the operators most likely to be impacted may currently be holding back from renewing their fleets because of uncertainty surrounding TfL’s direct vision standard (DVS), which will be introduced in the capital from 2020, covering all trucks of over 12 tonnes.

Last year, TfL published a list of provisional DVS ‘star ratings’ for Euro 6 trucks, which was first hastily amended and then removed from its website.

“The TfL website listing was very misleading. It was wrong,” Mr Flach asserted.

The implications of the rating system are serious. All vehicles of over 12 tonnes would require a permit to enter the capital. Vehicles with cabs awarded zero stars, which would seem to include most long-haul tractor units, would have to be fitted with as-yet unspecified ‘safety systems’ before they were given permits.

And from 2024, only those with ratings of three stars or above, or fitted with an as-yet unspecified ‘advanced safety system’ would be permitted.

But, with just two years to go before roll-out, many in the industry remain concerned by a perceived lack of clarity from TfL. Indeed, it apparently plans to continue ‘consultation’ right up until 2020: the year of the DVS’s introduction.

Trade associations are becoming increasingly vocal about the situation, with the Freight Transport Association (FTA) warning that the length of time TfL is taking to finalise the rules of the scheme, and an ‘unrealistic schedule for implementation’, are forcing fleets to postpone investment in new trucks.

Natalie Chapman, head of urban policy at the FTA, called the DVS scheme “a spectacular own goal” by the mayor of London.

“FTA, along with everyone living and working in London, wants to see an improvement in the city’s air quality, but this could have happened faster if the new DVS had been better planned,” she opined.

“FTA’s submission to the latest consultation on the scheme provides evidence that truck owners and operators are delaying procurement of the cleanest Euro 6 vehicles, because they have no idea whether they’ll meet the requirements of the DVS.”

The association cited recent figures from the Society of Motor Manufacturers & Traders, suggesting that new UK truck registrations were down almost six per cent on the same period the previous year.

“FTA believes this is due, in part, to uncertainty about the DVS and ULEZ in London and plans for clean air zones in other parts of the UK,” the association said.

The Road Haulage Association (RHA) echoed concern over the DVS, with policy director Duncan Buchanan stating that the large decline in the rigid market: “reflects feedback we’re getting from members over the massive uncertainty in the market being caused by the mayor of London’s DVS proposals.”

The London mayor’s latest stance is that the new standards will be available shortly from TfL, and provide operators with the clarity that they need to purchase ULEZ-compliant vehicles with the highest safety rating.

One way for operators to bridge the gap and continue to use existing vehicles might be to upgrade exhaust emissions controls to Euro 6 equivalence.

Speaking at the Freight Transport Association’s Transport Engineers Conference, the Low Carbon Development Partnership’s commercial vehicle programme manager Brian Robinson warned that “magic bullets were in short supply.”

He said that while companies were developing retrofit Euro 6 kits for trucks, as they already had for buses, tests for Euro 6 equivalence would cover whole vehicles in use rather than being based on bench engine-tests as used in Euro 6 proper. They would include rolling-road dyno tests with full air-quality management and be backed by track tests for vehicles of over 26 tonnes.

There would be four test cycles, with vehicles having to pass either the three fastest, or the three slowest. A separate test for refuse collection vehicles was in development.

“The key issue is that a national standard is needed,” Mr Robinson said.

“Experience in the bus sector suggests that incentives and grants can be hung on the independent testing process. Operators contemplating going down this route must insist that suppliers can provide independent certification that standards have been met. But for that, we do need a national standard.”