14 November 2017

Business demand for vans could accelerate with introduction of ULEZ

The number of vans operating in central London could increase as businesses introduce smaller vehicles to their fleets in place of HGVs that do not meet the strict Ultra-Low Emission Zone (ULEZ) entry criteria.

The £100 per day charge for using non-compliant trucks inside the ULEZ is potentially viewed as a major disincentive so, it is possible, that an operational solution may be the introduction of so-called ‘last-mile logistics’ that will see businesses transfer loads from non-compliant trucks to compliant vans for delivery in central London.

However, that could result in more vehicles operating inside the ULEZ giving rise to an increase in vehicle emissions and traffic congestion – both issues that London Mayor Sadiq Khan is trying to reduce with the introduction of the ULEZ and other transport measures.

The Road Haulage Association (RHA) said it was ‘outraged’ at the decision to introduce the ULEZ 17 months earlier than the originally planned September 2020 date and accused Mr Khan of ‘closing London for business’.

RHA chief executive Richard Burnett said: ‘It is essential that a realistic implementation date and appropriate phasing is established and adhered to. The current approach will lead to the use of more vans, will increase congestion and will undermine the economic wellbeing of the city. Given the switch to vans, there is even a strong possibility that the Mayor’s plans could make air quality worse. Hauliers and the people and businesses of London should not be penalised by this retrospective regulation that is little more than a tax grab by the Mayor.’

The RHA lobbied for a phased approach to the introduction of the ULEZ with businesses given more time for a higher proportion of the lorry fleet to be Euro VI ultra-clean trucks.

Highlighting that more than half the GB lorry fleet would not be Euro VI compliant when the ULEZ is introduced and that all trucks registered before 2014 would face heavy fines, the RHA said HGV replacement cycles were typically 12 years meaning that Euro V emission lorries would be just five to nine years old when the ULEZ was introduced and should have been excluded from the entry standard.

The RHA also believes that the Mayor’s bid to develop proposals for a London-wide Euro6 standard for buses, coaches and lorries for introduction in 2020 will result in businesses introducing more vans that could ultimately increase congestion and worsen air quality across the capital.

The British Vehicle Rental and Leasing Association (BVRLA), of which Activa Contracts is a member, also said it was disappointed that commercial vehicle operators had not been given enough time to prepare for the early introduction of the ULEZ. In its consultation response and meetings with Transport for London, it had called for ‘special consideration’ to be given to commercial vehicle operators, particularly SMEs.

BVRLA chief executive Gerry Keaney said: ‘The ULEZ will now come into effect 17 months earlier than originally planned and many commercial fleet operators will face a big financial challenge in trying to upgrade their vehicles ahead of schedule. Many of these operators will be small and medium sized businesses that rely on buying second-hand vehicles from larger fleets and can’t afford to go and buy a whole new Euro VI fleet at short notice.’

Freight Transport Association (FTA) head of policy for London Natalie Chapman agreed that the Mayor had ‘failed to take into account the time needed for businesses to comply with these new regulations, without incurring significant costs that could put real strain on overheads and business security’.

Ms Chapman claimed that there would ‘only be two and a half years’ production of vans available for operators to purchase, with little or no compliant second-hand market which will put pressure on operators already working to fragile margins”.

Commenting on the Mayor’s decision to consult on extending the ULEZ, Ms Chapman said: “This announcement fails to take into consideration the huge strides the freight industry has taken in meeting new emissions standards. London’s businesses and homes will still need to be supplied with products every day, if the city is to continue to trade efficiently in increasingly difficult economic circumstances, yet there is no allowance made for the freight operators that supply them.’

‘This is simply a tax on freight, which will have repercussions for business profitability and longevity across the capital at a time when we believe the sector deserves support to continue its efforts to achieve ever cleaner air for the city.’