Take action now on WLTP changes, says ICFM
Fleets are being urged to start paving the way for the changes posed by the introduction of the Worldwide harmonised Light vehicles Test Procedure (WLTP) rather than waiting for the Government and manufacturers to make further announcements.
So says the ICFM ahead of its WLTP Masterclass, which will provide further advice on the practical actions fleets should be taking.
Effective from 1 September for all new cars, the WLTP emission and fuel test cycle replaces the outdated NEDC cycle and is designed to be more representative of real-world driving. However, it has brought much uncertainty for fleets, which have been left in ‘limbo’ over future taxation as HMRC looks to switch to new formats of VED and Company Car Tax for WLTP-tested cars from April 2020 with an announcement anticipated in the autumn 2018 Budget.
Although in the interim the industry is using the current VED and CCT systems with computer-generated ‘NEDC Correlated’ figures, operators and drivers have been left in the dark as to what these figures are for some cars as manufacturers have struggled to meet the 1 September testing deadline, leading to some leasing firms removing untested models from their quoting platforms to take off cars that are not yet WLTP-approved. Carmakers such as Seat have also taken action to streamline their options lists as the new test cycle will take into account the options fitted to a car.
Meanwhile those models that have already been re-homologated are also facing large tax rises in some cases – latest figures from Jato show an average 9.6g/km uplift from the old ‘true’ NEDC figures to the new NEDC Correlated figures, bringing increased costs for drivers and operators.
Already, Arval has warned that the uncertainty over future taxation and the risk of higher tax bills is leading fleets to extend contracts while Meridian Vehicle Solutions has commented that fleets are also using medium-term rental as a means to manage the issue. There are also reports of drivers switching to taking cash options – set to reduce a company car market already in decline and bringing further risk and eco considerations for businesses.
Now the ICFM has said that operators should be acting now rather than waiting for further details on the impact to their fleet as it labels the switch to WLTP as “potentially the biggest shake-up in vehicle decision-making since the 2002 introduction of a Benefit-in-Kind tax system based on CO2 emissions”.
ICFM chairman Paul Hollick explained: “The challenges posed by the introduction of WLTP may be unprecedented, but they also provide opportunities to fleet decision-makers to review existing company car choice lists and their whole modus operandi. To put operations on ‘hold’ and wait for further announcements by government and manufacturers is to effectively go backwards.
“It is imperative that, at the very least, fleet decision-makers keep company car drivers informed as to exactly what is happening with the introduction of WLTP, regularly review vehicle choice lists and keep firmly abreast of manufacturers’ data and new model introduction timetables.”
The ICFM’s Masterclass will also provide insight into the actions fleet decision-makers should be taking.
The 60-minute event, which is free to attend, will be held on Wednesday 10 October from noon till 1pm at the NEC, Birmingham. ICFM members and non-members can book a place at the Masterclass by emailing [email protected].