WLTP Impact – Important! – A reminder of how it will affect your fleet

WLTP
Posted Posted on Categories Company Cars, Days FleetTags

Any vehicle registered on or after 1st April 2020 will have the new WLTP figures applied which could mean a significant change in Vehicle Excise Duty (VED) and benefit in kind (BIK), from 6th April 2020 for company car drivers.

These changes could affect existing vehicle orders and as soon as manufacturers publish their results, Days Fleet will work with each organisation/driver on a case by case basis. We are already working with manufacturers to ensure we have the emissions data as soon as it becomes available.

In the interim there will be challenges of vehicles falling outside of driver grades. Your company car policy may have a limit, for example 130 g/km CO2. If a manufacturer updates existing orders with new WLTP values these orders could fall outside of your policy when the vehicle is delivered, even though they were within the limit when they were placed.

You will need to decide how to proceed with these orders. It may be worth waiting until full WLTP figures have been released before amending policies regarding COlimitations, providing your policy still meets your requirements.

Background

As you are likely to be aware, in September 2018 new EU legislation came into effect whereby vehicle CO2 emissions were measured using Worldwide harmonised Light vehicle Testing Procedure (WLTP) rather than the previous NEDC testing that had originally been introduced for passenger cars back in 1990.

To assure a fair competitive and comparative basis, these WLTP figures were then correlated back to NEDC and these “NEDC-c” values were used to categorise the vehicle’s first year tax band for any vehicle registered on or after 1st April 2019.

As a result of the move to these NEDC-c values, vehicles commonly experienced an increase of between 10% and 20% in their CO2 emission values resulting in many moving up one or more bands in the current vehicle taxation scheme.

From 1st April 2020, a similar change will take place, whereby the NEDC-c values for new vehicles will be replaced by the full WLTP value and it is the WLTP value that will be used to categorise the vehicle’s first year tax band. With typical increases in CO2 emissions of 20% or more compared to the NEDC-c value, vehicles are again moving up vehicle tax bands meaning higher first registration fees.

For more information on WLTP, please visit the WLTPfacts website.

Should you have any further questions, please contact your Days Fleet account management team or email [email protected]