The UK government has a long-term strategy to reduce carbon and nitrogen dioxide levels in travel and improve air quality across the country - specifically in targeted hotspots, which include Newcastle city centre.
One of its weapons in this battle is to discourage and penalise the use of older, more polluting commercial vehicles. As a result, it has tasked some local authorities with introducing CAZs.
Some CAZs went live in 2021 and 2022 (for example; Bath, Birmingham, Portsmouth, the Oxford ZEZ and London’s extended Ultra Low Emissions Zone). More are scheduled to take effect later this year, including: Bradford, Bristol, Greater Manchester, Sheffield and Newcastle.
The Newcastle scheme will impact on the area’s population of over 1 million people and its thousands of businesses. It will affect commercial vehicles - including buses, coaches, lorries and vans.
The CAZ will cover an area where air quality is at its poorest and will operate 24/7, all year round.
The zone will be enforced by Automatic Number Plate Recognition (APNR) cameras, which will record all vehicle movements in and out of the area.
The minimum compliance requirement for diesel HGV engines will be Euro 6 (vehicles registered roughly after the end of 2015). Non-compliant HGVs will be charged £50 per day to travel in the zone!
If you don’t prepare for the change and mitigate against the daily charge, the financial impact on your business could be significant - yet more pressure on top of the double-whammy of Brexit and COVID-19, plus the economic effects of the conflict in Ukraine and the recent ban on red diesel in refrigerated transport.
If you’re operating older trucks into Newcastle seven days a week, the new CAZ could cost you £18,250 per truck per year!
Inevitably, rising costs on top of rising costs could be too much for some operators and some might go to the wall. Will you be one of them?
The simple fact is that CAZs are already here and Newcastle’s is not far away. Operators will be keeping a close eye on how the industry adapts to the changes. Those who do business in various areas will have multiple CAZs to deal with and their financial impact could be significant.
However, you need to do more than just keep an eye on developments. Crucially, you need to make sure you don’t sleepwalk into the new charges and allow your profits to go up in smoke!
As with any inevitable change, the best business strategy is to embrace it and use it to build yourself a strong, competitive and sustainable future.
Here at Dawsongroup truck and trailer, we refresh and upgrade our fleet on an ongoing basis and have a continual flow of new vehicles on order and available for contract hire. We have more coming on stream in the next few months.
With 100% of our fleet of around 4,000 tractor units, rigids and dropsides already meeting the latest CAZ requirements, we have availability and can offer affordable options to keep you clear of costly charges.
The underlying requirement for any operator is for maximum flexibility in both fleet operations and financial management – the kind of benefits we provide through our rental, leasing and contract hire services.
Both offer economical and flexible options that provide certainty and include many of your ongoing vehicle-related costs. Most importantly, they provide vehicles that allow you to carry on your normal business in CAZ areas, without any impact on your capital investment.
What’s more, acquiring vehicles in this way allows you to dispose of your old vehicles and invest any capital returns this generates into developing and growing other areas of your business.
In Newcastle, there’s over £23m available to help businesses upgrade to cleaner vehicles, and there will be a two-year exemption to allow for some upgrades to take place.
However, if replacing is your preferred option, why not sell your old vehicles and buy more up-to-date, compliant ones through our used sales business, Dawsondirect?
Dawsondirect can also help you dispose of your non-compliant assets. With values at an all-time high, there’s no better time to do that than now, but, again, time is of the essence as the market will inevitably change sometime in the future.
CAZs are just one part of a bigger environmental landscape, which will take at least a few years to settle down.
With the move to zero-emission HGVs firmly on the agenda and the transport sector’s road to zero picking up pace year on year, our contract hire services can also ease any concerns you might have about alternative-fuelled vehicles.
For the foreseeable future, regulations will continue to change and tighten, and technologies will continue to develop and improve. So, it’s difficult to make a compelling business case for greener vehicles right now, and you risk making big and costly mistakes.
Do you stick with diesel for the time being or do you venture into gas or electric vehicles? What will become the dominant fuel? How will residual values hold up? Will alternative-fuelled vehicles have second or third lives after their first lease or period of ownership?
With HGVs having relatively long lifespans and the 2035 and 2040 zero-emissions deadlines looming, how do you actually transition to a new kind of fleet?
The likelihood is that, whatever decision you make today, you’ll most probably have obsolete assets on your hands a few years down the line. These are all real-world issues facing today’s commercial vehicle operator.
We’re in the early stages in the journey towards lower emissions, and there’s a significant risk for operators at the lowest level of compliance - even after a very expensive retrofit, for example. The danger is that that they’ll be left behind when standards tighten further.
However, backed by our expertise and support, you can trial ‘greener’ vehicles risk-free in your own business environment, comparing key factors such as costs, operational performance and ease of refuelling, before committing to what’s right for your company.
So, we’re already doing a lot of the hard work – investing in new technology, trialling new kit and taking the associated risks – all so that you don’t have to.
With rising costs and increasing pressure due to inflation, finances are also under greater scrutiny, but, through Dawsongroup finance, we can provide options that free up much-needed cash for your business.
Everyone’s busy in these exceptional times, but you ought to make time to plan ahead and start a conversation with your supplier as soon as possible to discuss your options.
We can help support and insulate your business through changes in legislation, and prevent literally thousands of pounds going up in smoke while, at the same time, play a part in bringing cleaner air to the city of Newcastle.
Whichever way forward makes best sense for your operation, why not take a few minutes to contact me (tonyelliot@dawsongroup.co.uk 07767 377217) to discuss how we can make our award-winning services, partnership approach and excellent customer service work for you?
Alternatively, contact your nearest branch. It costs nothing. Do it now before the Newcastle CAZ kicks in in July.
You have nothing to lose except the endlessly rising costs of maintaining and adapting older vehicles and the real risk of racking up CAZ charges year after year.
Tony Elliot, Branch Sales Manager – Durham, Dawsongroup truck and trailer