London clamps down on diesels as market share plummets

Drivers of older diesel engined cars will have to pay extra to drive into London from 2019, as mayor Sadiq Khan has brought forwards plans to levy higher charges on the most polluting vehicles.

Originally, the mayor’s office had planned to introduce a new Ultra Low Emissions Vehicle Zone in London by September 2020, but the plans have been sped up as the British capital deals with an air pollution crisis.

From 2019, those driving petrol-engined cars which do not conform to Euro 4 emissions levels (introduced in January 2005) will have to pay an extra €12.50 to enter central London.

For diesels, it’s more stringent - cars which do not conform to Euro 6 emissions, which came into force in September 2014, will have to pay the extra charge. And it may not be just for central London by then. Mr Khan is preparing a consultation paper which could see the emissions zone extended to the entire London area, which encompasses more than 10-million people.

Mr Khan, who is himself an asthma sufferer, stated that “the air in London is lethal and I will not stand by and do nothing.”

The move, and other similar plans being rolled out in Athens, Paris, and Madrid, is expected to drastically reduce the levels of diesel sales across Europe. On average, diesel cars make up around 50 per cent of all European car sales, but this is expected to fall to as little as 30 per cent by 2020, according to a new report from JP Morgan Chase.

That's a significantly faster rate of decline than had been previously expected, and is being accelerated by the continuing bad press surrounding diesel power and its effect on pollution. Diesel car sales in Ireland have fallen significantly so far this year, from 70 per cent of the market at this time in 2016 to 66 per cent up to the end of March. Pure electric and hybrid sales have grown by 15 per cent and 84 per cent respectively.

The bank is predicting that this will lead to a significant profit squeeze, especially for the major German car makers which currently rely on sales of high-end diesel models for their income. JP Morgan predicts that the likes of Mercedes, BMW, and Audi could see declines of around five per cent in income, as diesel winds down, and new battery and hybrid technology will have to be rolled out to fill the gap.

Such technology is still expensive to develop, and hasn’t yet fully matured for profitable mass-production. All major car makers are scrambling to create new ranges of pure-electric and hybrid cars, but the development time is measured in years, not months, and if the JP Morgan report is right, then car makers have just two years and nine months to prepare.

Some are even suggesting that diesel will disappear from European sales altogether in a far faster time-frame than has previously been thought.

It's generally assumed that by 2050, all but a handful of cars on sale will be powered by batteries or hydrogen fuel cells, but the EU commissioner for industry, Elzbieta Bienkowska, has suggested diesel could die much sooner than that. Speaking at a session of the European Parliament, which approved tough new oversight laws for vehicle emissions testing, Ms Bienkowska said that "diesel will not disappear from one day to another. But after this year of work. I am quite sure they will disappear much faster than we can imagine."