Plan to get dirty diesel vehicles off the road extended

A scheme which encourages owners of old, pollutive diesel vehicles to replace them earlier will be extended for the final time to July 31, 2017.
A scheme which encourages owners of old, pollutive diesel vehicles to replace them earlier will be extended for the final time to July 31, 2017.PHOTO: AFP

A scheme which encourages owners of old, pollutive diesel vehicles to replace them earlier will be extended for the final time to July 31, 2017.

The so-called Early Turnover Scheme, which was introduced in April 2013, gives allowances to owners of Euro 1 or pre-Euro vehicles if they scrap these pollutive vans, trucks and buses earlier.

It allows owners to transfer the unused period of their vehicle's certificate of entitlement (COE) to the replacement vehicle.

A bonus COE period for the replacement vehicle, which is proportional to the existing vehicle's remaining 20-year lifespan, is also granted. This is provided the new vehicle meets at least Euro 5 standards.

That scheme was supposed to expire in April 2015, but in 2014 it was extended to last Saturday.

Last August, the scheme was expanded to include Euro 2 and 3 vehicles. This expanded scheme will also expire on July 31, 2017.

When it was launched in 2013, the scheme was slow in taking off because fleet owners found the calculations for grants hard to understand. Those who understood it found the incentive unattractive.

But when the scheme was revised in 2014, the response improved substantially.

Today, the bulk of diesel commercial vehicle sales is fuelled by the scheme - which allows buyers to get a new vehicle without having to bid for a fresh COE.

Mr Ron Lim, general manager of Nissan agent Tan Chong Motors, said: "About 70 per cent of our sales are for the Early Turnover Scheme. This is quite in line with the industry."

But, due to the strong response to the scheme, the allocation of fresh COEs for commercial vehicles has been crimped.

This has, in part, driven up premiums for buyers who need to purchase new vehicles, or those who need to expand their fleet.

Meanwhile, all new diesel vehicles will have to meet Euro 6 standards by January 2018.

On top of having particulate filters to reduce soot emissions, Euro 6 vehicles are equipped with a urea-based solution to neutralise nitrogen oxides - which diesel engines tend to produce more of.

Christopher Tan

A version of this article appeared in the print edition of The Straits Times on May 04, 2016, with the headline 'Plan to get dirty diesel vehicles off the road extended'. Print Edition | Subscribe