August 2008 Cert no. SGS-COC-0620 A REVIEW OF THE PASSENGER CAR MARKET IN THE UK THROUGH HISTORY TO THE PRESENT DRIVENwww.energysavingtrust.org.uk CONSUMER CAR CHOICES AND CO2 PASSENGER CAR MARKET Smarter DRIVING TRENDS OF THE LAST DECADE THE EXPLOSION OF THE MOTOR CAR Energy Saving Trust, 21 Dartmouth Street, London SW1H 9BP Tel: 020 7222 0101 Web: www.energysavingtrust.org.uk CO151 © Energy Saving Trust August 2008. E&OE DRIVEN A review of the passenger car market in the UK through history to the present CONTENTS ENERGY SAVING TRUST The Energy Saving Trust is one of the UK’s leading organisations tackling climate change. Funded by Government and the private sector, we are a private not-for-profit limited company with offices in England, Scotland, Wales and Northern Ireland. Our purpose is to help reduce carbon dioxide (CO2) emissions through energy efficiency and renewable sources of energy in the home, on the road and in communities. Since the Energy Saving Trust was established in 1993, through our initiatives we have funded or influenced the installation of sustainable energy measures which over their lifetime will lead to savings of over 100 million tonnes of CO2. We are perhaps best known for our work on energy efficiency, where our national network of 3 advice centres engages with over a million customers per year. We also have a significant portfolio of transport services, including 1 Executive Summary 4 6 Smarter Driving 24 consumer transport advice (such as low-carbon car purchase and smarter driving advice) provided 2 Introduction 5 7 CO2 Legislative and Policy through our advice centres, business transport 4 3 History – The Explosion Developments 26 advice for fleets and a low-carbon research and of the Motor Car 6 8 Consumer Car Choices development programme. In Scotland, we also provide a travel planning service on behalf of the 4 The Evolution of the Car and CO2 30 Scottish Government 1. 1970s to the present 8 9 Conclusions and Written by David Kenington 5 Passenger Car Market Trends Recommendations 32 Produced by Matthew Robinson of the Last Decade 12 9.1 Recommendations for With thanks to: Jamie Beevor 5.1 Market Overview 12 Government and the Nigel Underdown 5.2 Super Minis 14 Energy Saving Trust 34 Paula Owen 5.2 5.3 Small Family Cars 9.2 Challenges for Caroline Watson Bob Saynor (Lower Medium) 16 Manufacturers 35 5.3 Family Cars 9.3 Final Summary 38 (Upper Medium) 17 5.4 Executive Cars 18 5.6 Sports Cars 19 5.7 SUVs 20 6 5.8 Luxury Saloons 21 5.9 Multi Purpose Vehicles (MPVs) 22 1 This is an Energy Saving Trust publication. All views expressed within this report are those of the Energy Saving Trust and are not intended to represent the views of Government. All numbers and statistics were correct at the time of publication, however as many areas are evolving, numbers and projections are subject to continual review. 2 DRIVEN DRIVEN 3 1. Executive Summary 2. Introduction 1 2 EXECUTIVE SUMMARY INTRODUCTION limate change is now The main reasons for current poor vehicle models of vehicles which are already n the UK, there are more than 26 million new technologies are still a long way from accepted as one of the choices are: available on the market. cars on the roads. There are more cars market4. How can these emissions be greatest challenges facing • Lack of awareness of independent than there are households, or one car significantly reduced in the near term? mankind today. The time information and advice which makes CO2 Funded by the Department for Transport and I for every two people. for talk is over. The focus is information clearer and more prominent the Scottish Government, we have recently This review is the latest in a series of market now on taking action to throughout the vehicle purchase process and started to provide consumer transport advice The car has been one of the most pervasive review documents from the Energy Saving Cdeliver the CO2 savings needed to meet so can encourage consumers to take action. through our network of advice centres. These inventions of our time and our enduring love Trust5 assessing high energy-using markets in our reduction targets. • The current market structure, where more focus on helping consumers to purchase affair with it dates back to its invention in the terms of CO2 emissions, exploring major desirable cars within vehicle model ranges lower-carbon vehicles, to drive their cars late 19th century. Particularly since the Second trends and the opportunities for reductions In the UK, the transport sector produces tend to have higher CO2 emissions. more efficiently and to use their car less. World War, the car population has exploded, in CO2. In this report, we review the nearly a quarter of our total CO2 emissions, to the extent that there is now one car for development of the new car market in the with 57 per cent of those emissions directly This is an encouraging start, because this every two people, or more than one car per UK throughout recent history to the present attributable to the passenger car. Whereas review shows that advice for consumers will household in the UK. and assess the impact of this development on emissions from most sectors have been Car buyers are making play a crucial part in delivering these reductions. CO2 emissions. The aim of this report is to: decreasing, transport emissions have significantly Information alone is not enough and little While CO2 emissions from other sectors have increased since the 1970s. This is a review of poor choices when it comes proactive advice is provided at the moment. largely been decreasing, the opposite has • Explore the development of the new the development of the passenger car market in to the CO2 emissions of been the case for transport, where emissions car market in the UK through history to the UK through history and its associated CO2 There is much greater potential for CO2 have risen significantly since the 1970s. the present. emissions, undertaken to help understand how their new cars. This means savings to be made through scaling up these This has been a direct result of our desire for • Improve understanding and awareness of we can reduce CO2 emissions most effectively in there are opportunities to services and working increasingly with local more cars and other forms of transport. where CO2 emissions are produced within the the future. delivery partners. So the main action As car numbers have grown, so have their new car market by analysing emissions from reduce CO2 emissions by recommended in this review is to increase negative impacts and recently, the impact each segment of the passenger car market. The new car market is complex and made up the level of independent, proactive, in-depth of automotive CO2 emissions has risen to the • Through this analysis, explore the opportunities of a number of very different sub market up to 25 per cent – simply advice for consumers from 2009/10. top of the agenda. available to reduce emissions through segments, each contributing to the overall CO2 by improving new delivering ‘energy efficiency’ in the car market. emissions figure. Understanding the true Our current turbulent economic situation and Transport is now one of the most significant • Make recommendations for action in order to nature of its CO2 impacts and identifying the vehicle choices very high oil prices mean that reducing road producers of CO2 emissions worldwide. deliver significant CO2 reductions from the best opportunities for reductions requires transport costs is going to be high on In the UK, transport is now responsible for new car market in the near to medium term. detailed analysis – which this review provides. householders’ agendas. We believe that 25 per cent of all UK CO2 emissions, with In this review we find that there are a scaling up advice services will encourage nearly 60 per cent of those emissions directly The report focuses on highlighting the To date, the passenger car market has been number of significant opportunities that people to act, because our advice will help attributable to the passenger car. opportunities to make CO2 savings using slow to respond to the problem of climate could reduce new car CO2 emissions by up significantly reduce these costs as well as existing technologies in the market – i.e. change and there is a very large range of CO2 to 25 per cent in the short to medium term. saving CO2. So the problem of car-related CO2 emissions is through ‘energy efficiency’ means. This is emissions within the choice of new cars This is equivalent to the annual CO2 clear. Unfortunately, solutions delivered by because ‘new’ (i.e. non petrol or diesel based) available to buy in the UK today. We find that emissions of a third of a million houses, However, advice alone will not deliver the low-carbon vehicle technologies are expensive consumers are currently making poor choices or a city the size of Glasgow2. potential for CO2 reductions in the new car and still far from being competitive in the when it comes to the emissions of their new market. Manufacturers also need to work hard to market. There is a need to reduce emissions cars, despite there now being good incentives Importantly, these reductions can be achieved improve the quality and desirability of traditionally While CO2 emissions from road transport significantly in the near to choose low CO2 vehicles. This is not only without the need for new technologies, fuelled low-CO2 models within their vehicle from other sectors have term – and there is an opportunity to achieve having a negative effect on CO2 emissions which are still some years away from ranges in order to improve sales.