Monday, 2 july 2018 | Redacción CEU
What does the actual car consumption consist of? What is the real level of emissions? The WLTP protocol aims at answering these questions in a more faithful way to reality than the current model does. Until now, the fuel consumption or the range of electric cars have been measured through a standardization process based on theoretical driving: the NEDC protocol. A regulation whose accuracy has been questioned since the so-called “dieselgate” scandal. The automotive industry is now in the final countdown to the implementation of a more realistic regulation and with a mandatory compliance with the European Union. Are brands ready to face this challenge successfully? What consequences will the imminent arrival of this new homologation have on the industry? How will this shift affect consumers?
The tests that standardize fuel consumption, emissions, polluting particles or energy consumption in alternative propulsion systems of cars will be now more complex and exhaustive and will take into account real driving situations. A new regulation will put in place variations in these measurements like taking into account different equipment and optional extras of vehicles, different speeds, longer distances, several phases of driving, key elements such as the ignition of air conditioning, gear changes or driving under higher temperatures.
The WLTP (Worldwide Harmonized Light Vehicle Test Procedure) will be the new procedure that will put an end to the NEDC (New European Driving Cycle) protocol. This latter has been in force since the 80s and now seems to be obsolete and unrealistic. The cars from that generation have nothing to do with the ones that are manufactured nowadays and, therefore, nor with the standards that we have to conform to these days.
The arrival of the WLTP is imminent and there is no turning back. From the next 1 September, all new vehicles that are sold must follow this protocol. The regulations will also affect all cars on sale in 2019. Undoubtedly, manufacturers will be the most affected by this situation. They will not only be forced to standardize their cars, but also to adapt them so that they comply with stricter requirements.
Manufacturers have pointed out that the period of time that they have had for adapting to this new regulation has been too short. The centers responsible for certifying the new standardization will have to carry out thousands of tests. They confess that it will be also difficult for them to fulfill the goals set in the new regulation. The industry recognizes that this transition process can also cause the so-called bottlenecks. The WLTP will have a direct impact on the vehicles that will be offered. Brands like Opel or Volkswagen are considering eliminating some models of their ranges. Other firms are betting on stopping the production of some models or delaying the availability of these vehicles until further notice. This last option has been the one chosen by Porsche.
This new protocol has not just created quite a stir in the automotive industry because of the effort involved in the adaptation to the new system, but also because, according to the current regulatory framework, the level of CO2 emissions determines the tax burden of vehicles in Spain. With the arrival of the WLTP, it is expected that the results of the measurements will be higher than the current ones and, therefore, that the sale price of the vehicles will be affected.
Until now, cars that did not exceed 120 grams per kilometer did not have to pay. In case the tax system does not change with the new regulation, Faconauto claims that the cars that would pay the registration tax would account for 70%, compared to the 20% that now do. This could have repercussions on a drop in sales of up to 10% according to Gerardo Pérez, president of the federation.
Vehicles that have not been sold before September will no longer be considered new vehicles. However, the legislation allows 10% of cars sold by each brand to be exempted from this homologation. Despite this exception in the regulation, authorized dealers are very likely to accumulate an overstock of vehicles with zero mileage. Faconauto has warned that during the summer months there may be a rebound in the self-registration, and if this period of stock accumulation is not approached in the right way, many authorized dealers could end up having financial problems to cope with their activity in the long term.
Customers can benefit from this accumulation of stock. The brands will be more willing to give discounts to arrive in September with the fewest possible number of new vehicles. Therefore, it is a favorable period to consider the purchase of a new vehicle, especially considering that prices will probably rise after the full implementation of the WLTP.
On the other hand, from September, customers will have the opportunity to get to know more about the particularities in the driving of each car, they will have more information when opting for one model or another and will have a greater guarantee that those vehicles that they are considering buying conform to the environmental care parameters set by the European Union. For its part, the automotive industry will avoid the circumstances that led to the “dieselgate” scandal.
The CEU IAM Business School has designed a Master's Degree in Automotive Industry Businesses which contemplates the new challenges facing the automotive world. It is a program designed to provide the skills, competencies and tools which are necessary to make complex and difficult decisions in an emerging and changeable industry that demands professionals with a solid business knowledge.