Study: green cars to outsell gas guzzlers this year in the UK
Vehicles in the UK are grouped into tax bands from A to G, depending on how much CO2 they emit. Cars ranked A and B are the greenest (and least taxed) while cars ranked G are the ones that emit the most CO2 (and drivers have to pay more). Since the tax bands were instituted, sales of A, B band cars have gone up while sales of G band cars have gone down. The Society of Motor Manufacturers and Traders studied the trend in sales and predicts A and B will outsell G cars this year for the first time ever.
You don't have to worry about SUV tax turning up in your tax returns (if you live in the U.S.). If we get a carbon law at all, there won't be any taxes on cars according to a House white paper on the topic. Most of the American presidential candidate's energy policies call for tax incentives, but not penalties. If if could be implemented, how much of a tax would it take to change sales of SUVs? Canadians, for example, are taxed $4,000 for driving an un-green car. Would that stop you from buying an SUV?
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[Source: This is London]
Reader Comments (Page 1 of 1)
Throwback 5:02PM (1/29/2008)
Are the A&B band cars generally cheaper than the G band cars? As for us, yeah $4,000 to the price of any car would stop me from buying. Taxes are not the answer to every problem. I think if there was a sliding scale of tax rebates (similar to a child tax credit) for cars would have a huge impact. Start with cars that get 40 MPG combined and slide down to 30 mpg. Step up the scale every 2 years by 1 mpg and eventually get to where 35 mpg is the cut-off. We Americans love nothing more than being able to keep more of our money.
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Lascelles Linton 6:14PM (1/29/2008)
Throwback, Probably. They are probably smaller cars. Don't think it matters that much. Just knowing you are paying more than something costs is what I think really gets people.
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Scatter 6:35PM (1/29/2008)
The A and B band cars are for the most part a lot cheaper. You can search by VED band here:
http://www.vcacarfueldata.org.uk/search/vedSearch.asp
A list of sub 120g/km cars (band B and below) can be found here:
http://www.vcacarfueldata.org.uk/information/how-to-use-the-data-tables.asp#petrol
Band B sales in 2007 were up 15% on the year before, Band G sales were down 15%. A big market shift is underway.
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1985 Gripen 6:46PM (1/29/2008)
Unfortunately the U.K. gov't doesn't allow a credit for CO2 emissions from biofuel as opposed to petroleum-based fuel.
For example, if you own a Saab 9-5 BioPower (ethanol/gasoline flex-fuel) and run the car on E85 then only 15% of the CO2 emissions from that car are fossil fuel emissions (from the 15% of the E85 comprised of gasoline). 85% of the E85 (the ethanol portion) is all renewable CO2 emissions (and therefore carbon-neutral). So if you figure NET CO2 emissions the E85 capable vehicles should be taxed less than a typical gasoline-only vehicle but they're taxed on GROSS CO2 emissions instead.
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Scatter 7:02PM (1/29/2008)
Bioethanol is far from being carbon neutral at this point in time. Alternative fuel vehicles get a very slight discount on their VED but nothing very significant and rightly so.
There are only about 20 filling stations in the country that sell E85 so the chances of you actually using the fuel are slim.
Fine give a fuel duty incentive (it's slightly cheaper) but flex fuel vehicles should not get a discount at this stage in my view.
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texmln 10:17PM (1/29/2008)
I see people on the boards here whine and cry that ethanol is a phony, tax driven scheme yet here's an article that cheers about how sales of 'green' cars are driven by a phony, tax driven scheme. What's the difference between reducing the price of ethanol by paying producers via a tax incentive vs. increasing the price of 'standard' automobiles by implementing a tax penalty? Same thing. Given a free choice, most consumers would shun the 'green' cars and they would be done for quickly. Such cars will only be successful when the cost of fuel for other vehicles makes 'green' cars financially competitive. Which might be never.
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scatter 4:53AM (1/30/2008)
Texmln I agree with the need for incentives and subsidies for green products (although I am yet to be convinced about the environemental benefits of non-cellulosic ethanol) but in this article's case it's not the tax that's driving change. The differential between low and high carbon cars is not big enough. What's more likely to be driving it is high fuel prices (£1.05/litre, around $8 a gallon) and increasing environmental awareness (to a lesser extent).
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rgseidl 6:58AM (1/30/2008)
@texmin -
there is in fact a huge difference: high taxes depress demand for fuel guzzling technology - regardless of fuel grade - and therefore have a proven and significant effect on actual fuel consumption and CO2 emissions. Taxes are the primary reason why the average European causes less than half the CO2 emissions due to driving that the average American does. Nothing phony about that at all. It's just that it usually takes a number of years before the effect becomes evident.
By contrast, biofuels initially just shift demand from dinojuice to another source. IFF that source is sustainable, there is indeed a significant reduction in CO2 emissions. Unfortunately, not all biofuels are created equal, even if their chemical composition is comparable. The critical issue is how the feedstock is produced. For example, corn ethanol fares badly on this score and so does biodiesel made from palm oil grown on land that was still rainforest just recently.
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