The UK Government has ambitious air quality plans that could have an enormous impact on the automotive industry over the next few years. Recently, it was announced that the culmination of these plans was to ban the sale of petrol and diesel cars from the year 2040. Additionally, they will increase the tax on new diesel cars to fund these air quality plans.
A Long Battle
This huge plan is to combat the air pollution crises in the UK and to avoid accelerating climate change. This has been a long battle in the UK, with the congestion charge, bike-share scheme and a recent freeze on public transport fares being other steps taken to combat air pollution.
Low Demand
Despite these bold plans, the demand for alternatively fueled vehicles is relatively low and the Government is wary of demonising those that buy petrol or diesel. Instead, they are offering incentives for those that buy eco-friendly vehicles such as no road tax.
The Market
With this time to adjust, it is likely that the used car market will suddenly have a huge increase in stock as motorists look to make the switch way ahead of the 2040 ban to benefit from the incentives. Although many will be looking to sell their petrol and diesel cars, there will also be many motorists still keen to buy these for affordable prices in the used car market. The ban is a long way off and many believe that the ban is not feasible and will never happen. The main reason for this doubt is the strain that the ban would put on the National Grid.
With a lot of questions still waiting to be answered, it seems that motorists will be steering clear of buying brand new petrol and diesel automobiles and instead looking at second-hand cars. This will also see a rise in extended warranties for industry leaders like ALA, as these motorists will want their repairs to be covered and will no longer benefit from the manufacturer’s warranty.
The future for petrol and diesel automobiles seems unclear at the moment, but it is clear that the Government are looking to make big changes in the near future and encourage motorists to switch to alternatively fueled automobiles. They intend to do this without demonising motorists of petrol and diesel-powered cars, yet there are many who believe that the switch will never happen. This puts many in a difficult decision and is likely to lead to a lot of turbulence in the automotive industry over the next few years.