Calls for urgent rethink on London ULEZ extension

Up to 400,000 older cars are expected to fall foul of newly expanded ULEZ

Experts say larger ULEZ could affect up to 400,000 motorists and label new scrappage scheme ineffective

Motoring organisations and used-car experts have criticised the scope and value of the mayor of London's recently announced vehicle scrappage scheme, intended to compensate drivers and residents in the forthcoming extended Ultra Low Emissions Zone (ULEZ) who will be forced to change their vehicles to avoid paying an emissions charge. 

The extension to the London ULEZ is set to go live on 29 August, when it will encompass all boroughs within the M25. To avoid attracting the zone's daily emissions charge of £12.50, petrol cars must meet at least the Euro 4 emissions standard, which became mandatory in 2005, and diesel cars at least the Euro 6 standard, which became mandatory in 2015.

Under the new scrappage scheme, up to £5000 per claimant is available, although the standard allowance is £2000.

To qualify, residents must be receiving certain low-income or disability benefits and be scrapping a car that doesn't meet the new emissions limits. People claiming the higher £5000 allowance must be scrapping a wheelchair-accessible vehicle.

The mayor's office said the ULEZ expansion will help clear the capital's roads of 200,000 high-polluting vehicles. However, the AA disputes its figures, claiming its research shows that up to 400,000 cars will be affected.

Luke Bosdet, an AA spokesman, said: "This is a much higher figure, and we're concerned that by only providing relief for people on benefits, the scrappage allowance excludes those on low incomes juggling multiple jobs, as well as those in the care sector who need their cars to visit patients."

The RAC questioned the timing of the ULEZ extension. Nicholas Lyes, head of roads policy, said: "We're concerned that expansion is taking place when drivers are already struggling with high fuel costs. We urge the mayor to look at expanding the scrappage scheme to benefit more households. Alternatively, residents should be granted a sunset period until August 2024 to give them more time to upgrade.”

Vehicle valuation experts questioned the value of the £2000 scrappage allowance.

Dylan Setterfield, head of forecast strategy and operations at Cap HPI, said: "The £2000 available to some Londoners via the scheme is unlikely to be enough to enable the purchase of a car which meets the current criteria to avoid the ULEZ charge."

His comments were echoed by Darren Rodwell, leader of Labour-controlled Barking and Dagenham council, who said the £110m scrappage wouldn't provide enough compensation for people forced to change their cars. 

However, drivers and residents in the affected zone may draw comfort from the fact that many older, non-compliant cars have, according to Cap HPI, recently risen in value by around 3%, compared with three-year-old vehicles, values for which have remained flat. Theoretically at least, this should help ease the cost to change from a non-compliant car to a Euro 4 petrol or Euro 6 diesel.

One person hoping to take advantage of the uplift is Ali, who lives in Streatham. His advertisement for his Audi A3 2.0 TDI Sportback, which was registered in 2013 and has done 43,000 miles, reads: "Reluctant sale due to ULEZ".

"I live just within the extension, and a friend said I should get rid of my car while it's still worth a reasonable amount," he told Autocar. "I'll be sorry to see it go, but I have no choice."

He's advertising his Audi for £8140, a price in line with private sales values recommended by online valuation services.

It had been predicted that the values and prices of non-compliant cars would be adversely affected by the new zone, but Setterfield believes this to be unlikely, at least while car numbers are low and demand buoyant.

"These days, vehicles are transported all over the country by auctions and retail cars are all advertised online, meaning the geographical location is much less relevant," he said. "We haven’t noticed any localised ULEZ effect yet, but that’s not to say it might not happen at some stage."

Amid growing concerns about the value of the scrappage fund, the rising cost of living and the reduced availability of public transport in outer London, more than half of the councils affected by the expansion (including Labour-controlled ones) are urging London mayor Sadiq Khan to rethink his plans.

Some are considering legal action to block the extension, while others have refused to sign the Section 8 agreement that allows Transport for London (TfL) to install the roadside cameras necessary to detect cars.

However, on that point, TfL's 'reserve powers' permit it to install two-thirds of the scheme's 2750 cameras without requiring council permission.

Khan said that opposition to the extension is a "political strategy" by Conservative-controlled councils "in the pocket of vested interests" and the decision to proceed is necessary to reduce the capital's high levels of pollution.

As part of that objective, TfL has budgeted to receive £200m in revenue from the scheme in its first 12 months, to be reinvested in public transport.