Diesel cars won’t be affected…yet
Diesel car owners will be relieved to hear that the value of their car will not drop as sharply as first feared. A report released by CAP Automotive Ltd states that there will be no affect on used car values following the introduction of a new penalty charge. Earlier this week the UK government issued notice that all non-Euro 6 diesel cars entering parts of London would incur a £10 penalty charge.
The report from CAP states that because the penalty only affects drivers in London, there should be no reduction in prices for used diesel cars. However, if the government policy was to spread to other parts of the UK, then this could change.
Mark Norman, senior consultant at CAP said: “Too few cars are affected by the current proposal to have any impact on demand for diesel cars, whether or not they come under the scope of the envisaged daily £10 charge for entering central London.
“The picture might change if more cities adopt ultra-low emission zones and drivers find themselves paying more penalties but there is still a long way to go before that point.”
The recent government announcement came as a shock to many diesel drivers, especially as most advice states that the diesel option is cheaper than normal petrol. The penalty charge is a result of the low emission targets that the UK and EU are aiming to meet. London is the first to adopt the penalty in a bid to ease congestion. Reports state that other cities and councils are also considering the measure. Cars that fall into the Euro 6 Diesel car category would not be affected.
“Car values are simply not that sensitive to localised factors, as we have already learned from London’s existing congestion charge,” continued Mark Norman, “If they were we might have seen the values of electric vehicles rising in and around the capitol but there is precious little evidence of any difference in residual values between different areas in the country.
“The excitement in the media generated by the announcement of possible penalties for what will be quite old cars by the time this measure is introduced could be misunderstood by motorists.
“If they only hear that diesel cars in general will be penalised harder than other cars for entering the capitol this could conceivably have a small impact, but nothing of sufficient scale to translate into generally lower residual values.”
With both the current government and the Labour party planning to reduce emissions over the next few years, it is impossible to know just what affect any penalty charges will have on the used car market. As always, it seems to be a case of watch and wait.
What do you think of the proposed penalty charges? A fair way of reducing emissions or just another way to take money from UK drivers? Let us know in the comments below.
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