Challenges of Green Cars market during economic crisis in Greece
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1 Challenges of Green Cars market during economic crisis in Greece Efi Mavrou Environmental Science, MSc, Centre for Renewable Energy Sources and Savings Pikermi, Attiki, Greece 1/20
2 Effects of the economic crisis to the car fleet The market of new sold cars is experiencing a deep crisis, having huge decreases on the sales, despite the bonuses provided by the state, under the status of Vehicle withdrawal program that runs in the country since It is estimated that about 3000 dealerships have shut down since /20
3 Vehicle withdrawal program A government program encouraging vehicle owners to replace older cars (registered before 31/12/2000) by offering an incentive worth up to euros No cash refunds are issued to the buyer The incentive ranges from 300 to euros but can go higher in some cases after factoring in registration fees and discounts on luxury tax. Primary calculations are made by engine size: Up to 900 cc: 300 euros cc: up to 960 euros cc: up to 1430 euros cc: up to 2100 euros cc: up to 2800 euros 3/20
4 Effects of the economic crisis to the car fleet Due to the increase of the cost of the fuel, in combination with the decrease of the consumer s income, consumers tend to freeze high energy consuming vehicles (jeeps or of high cubism), which are either for sale or have been put permanently in the garage This has increased the sales of small and cheaper-in-use cars, which usually combines with green cars: Consumers first criteria nowadays is low consumption of fuel and low taxation. 4/20
5 Effects of the economic crisis to the car fleet The President of HAAMI (Hellenic Association of Automobiles Importers) has noticed: Today the interest concerning the car market focuses in small cars of cc. The vast majority of consumers are looking for second hand cars (circulated in the market after 2000) at a price of maximum euros. Some are looking for even cheaper ones, since they can afford up to euros. 5/20
6 Effects of the economic crisis to cars sales There is a clear increase of the sales of second hand cheap cars, which does not necessarily implies green cars Year Second - hand Car sales New sold cars Total per year Total Year Second - hand Car sales New sold cars Total per year Total /20
7 Vehicles share Very small vehicles (category A, city- cars, small size and ~ 1.000cc): 5 years ago: 10% Category B (small cars, ~1.400cc) : 5 years ago: 30% % of the market 38% of the market High cc vehicles, jeeps, SUV, luxury cars : almost no demand Not only no one wants to buy them, but even to have and/or use them: plenty of second hands are for sale, even in half price than 5 years ago, and still remain in stock Consider exportation as a solution? 7/20
8 Extra criteria: CO2 emissions Vehicles that have CO2 less than 100gr/km are becoming a consumers new target Both because they have low fuel consumption (or are hybrid) and are circulation (road) tax free Vehicles that use Diesel and LPG (having lower CO2 emissions) are becoming in favor of the consumers preferences as well 2 parameters that encourage these preferences are: Diesel is now permitted to be used in the 2 biggest cities of Greece (Athens and Thessalonica) Most brands have now available in Greece models in Diesel and LPG versions 8/20
9 Categorization of Circulation Taxes Tax categorization before 1/11/11 (according cc) Tax categorization after 1/11/11 (according CO2 emissions) cc CO2 gr/km /gr CO /20
10 New sold Car Market Top Models MODEL Nr of Cars sold CO2 gr/km gasoline CO2 gr/km LPG CO2 gr/km DIESEL OPEL CORSA TOYOTA YARIS CITROEN C VW POLO OPEL ASTRA FORD FIESTA FIAT PANDA NISSAN MICRA HYUNDAI I SKODA OCTAVIA /20
11 Effects to hybrid car market A decrease in the sales of hybrid or new technologies cars, which are environmental cleaner and cheaper in use (up to 40% fuel saving) but more expensive to buy, has been noticed Year Hybrid Car sales ~900 11/20
12 Effects to hybrid car market On the other hand, there is an increase in the range of hybrids that can be found in the Greek car market. The first hybrid car in the Greek market was Toyota Prius in Audi A6, A8, Q5 Hybrid TOYOTA AURIS Active, Lounge YARIS Active HSD, Active Plus HSD, Style HSD, Lounge PRIUS Base, Advance, Exclusive MERCEDES E Blue TEC HYBRID S400 Hybrid OPEL AMPERA PORSCHE CAYENNE S HYBRID HONDA CR-Z, JAZZ HYBRID Comfort, Elegance & Exclusive Insight MY10 & MY11 CIVIC Hybrid LEXUS CT Advance, Elegant, Luxury RX 450h Dynamic, Execute, Luxury, Luxury Plus GS Classic LS Classic VOLKSWAGEN TOUAREG TSI HYBRID BMW ActiveHybrid 3, ActiveHybrid 5, 750i ActiveHybrid 750Li ActiveHybrid 12/20
13 Effects to hybrid cars market The price of hybrids cars in Greece is 25-30% higher than the correspondent conventional ones and the true benefit comes during the entire life time of the vehicle. During the economic crisis, consumers are not able to pay this extra cost when purchasing the vehicle. The withdrawal program has not given extra bonus to the hybrid cars market, since they already benefit from free- taxation. Most consumers that use withdrawal program buy conventional cars. 13/20
14 Effects to LPG cars market One other effect of the crisis is the high increase to the price of the gasoline, due to extra taxation. This has led many car- owners to change their vehicles to LPG fuel, since LPG is protected from EU legislation with low taxation. This results to a lower price of LPG in comparison with the gasoline s of about 50%, even if the actual savings are a bit less. The use of LPG has also benefits for the environment, since it has less emissions, comparing to gasoline: 10% CO2 60% CO 40% HC 60% NOx 14/20
15 Effects to LPG car market The procedure of changing a car from gasoline to LPG is by installing a new system to the vehicle, that allows the motor to use both fuels, and a LPG tank. This has led to the creation of extra work for the relevant garages The cost is about euros and in a few years the car owner has made payback time, depending on the use made. The last years most brands have LPG models available to the Greek market. 15/20
16 Effects to Diesel cars market Since the 80s, there was a prohibition for the circulation of diesel cars in the big cities of Greece, Athens and Thessaloniki, due serious pollution caused mainly by old technology trucks that were using heating fuel oil instead of diesel. This changed on November 2011, when diesel vehicles are allowed to circulate in the big cities. The evolution of technology has led diesel motor vehicles of Euro 5 Standard to have less fuel consumption and less emissions than gasoline. An example from the market is the gasoline version of Fiat Punto Evo 1.4lt, 105PS that consumes 5.5lt/100km and has 134 g/km CO2 while the relevant diesel Fiat Punto Evo 1.3 Multijet 85 PS consumes 3.6lt/100km and has 95g/km CO2 which also means no circulation taxes. According to the HAAMI, the 1 st semester of 2012 the diesel car market has shown a 166% increase cooperatively to the same period of 2011 (only in June 2012 there was a 192% increase in diesel cars sales compared to June 2011). 16/20
17 Diesel car sales 1 st semester 2012 BRAND Nr of Cars sold OPEL 1933 CITROEN 1573 TOYOTA 846 FIAT 774 SKODA 771 VW 579 VOLVO 568 FORD 534 NISSAN 513 PEUGEOT 299 MODEL Nr of Cars sold OPEL CORSA 1468 CITROEN C TOYOTA YARIS 723 VW POLO 403 FIAT PANDA 395 FORD FIESTA 377 NISSAN QASHQAI 375 SKODA OCTAVIA 368 CITROEN C4 364 OPEL ASTRA /20
18 Green car benefits Free Parking Municipalities of Thessaloniki, Kalamaria and Thermi provide free parking spaces for low fuel consumption vehicles. Green vehicle ring Green vehicle ring system provides the benefit to the owners of green cars to be able to circulate their cars in Athens city center all days (since 3 September 2012). The vehicles that can benefit from the Green vehicle ring are cars and tracks (up to 2.2 tones) of Euro 5 or newer, that have CO2 emissions 140g/km or less, irrelatively of the fuel. Hybrid and LPG cars of Euro 4 can also circulate in the city center, as long as they have CO2 emissions less than 140g/km. 18/20
19 Open consultation on the penetration of electric vehicles MEECC has formed a Committee in order to define the benefits that potentially will lead to the penetration of electric vehicles to the Greek market and presented the results to an open public consultation. The Committee s suggestions are: The benefits that currently exist for hybrid cars (HEV) that can also use gasoline, diesel or alternative fuels are proposed to exist only for pure hybrid vehicles (HEV). For the Plug-in Hybrid Electric Vehicles (PHEV) and Extended Range Electric Vehicles (E- REV) that have an extra unit that can use gasoline, diesel or alternative fuels is proposed: a) to be exempted from the luxury tax, no matter their value, b) to subsidize their purchase price up to 10% of their sale price (including VAT), with max euros if their CO2 emissions are up to 75 gr/km according to New European Driving Cycle For the Battery Electric Vehicles and Fuel Cells Electric Vehicles is proposed: a) to be exempted from the luxury tax, no matter their value and b) to subsidize of their purchase price up to 10% of their sale price (including VAT), with max euros 19/20
20 Thank you for your attention! 20/20
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