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The government is introducing a series of new rules under what is being called the Clean Car Programme. The first really big one to affect used car buyers is called the Clean Car Standard (from 1st April 2022). CO2 (a major contributor to Greenhouse Gas) reduction is the main aim of the programme. The new legislation is designed to encourage the purchase of low emissions vehicles by giving money back to buyers of economical, and environmentally friendly cars in the form of a rebate (as long as they have a three-star safety rating or better); but it’s also supposed to make you think twice about buying a higher-emitting vehicle, by adding a fee.
You might also have heard this referred to as a “feebate” scheme, meaning a combination of rebates and fines that are supposed to balance each other out. It’s self-funding, so the fines from the higher-emissions vehicles are actually paying the rebates for the cleaner ones.
Which cars does this apply to?
The key thing to know is that feebates only apply to used cars that are being registered in New Zealand for the first time. If the used car you are thinking of buying has already had a Kiwi owner (it already has a number plate, in other words), the Clean Car Standard doesn’t apply.
But if the car is new-to-NZ, the Clean Car Standard formula will be used when it’s registered. It’s compulsory; there’s no way of opting out.
Who administers the fees/rebates?
Another important thing to understand is the Clean Car Discount is a transaction between the car owner and the government. Rebates or fees are paid to, or by, the purchaser of the car; they do not go to the car dealership (although the Enterprise team will certainly be able to advise if the vehicle you are purchasing is eligible for a rebate or if a fee applies (and what the processes is). Once the vehicle is first registered in NZ, the owner can apply for the rebate through the Governments NZTA website, however the fees are paid at the time of first registering the vehicle.
How are feebates calculated?
Feebates are calculated on each models’ CO2 emissions (measured in grams per km, or g/km), which is directedly related to how much fuel they use. Why not just use fuel consumption figures? Because petrol and diesel engines produce different levels of CO2 per litre burnt, so the CO2 is the most consistent measure.
Carmakers quote a variety of different fuel economy tests around the world, so the government has settled on a particular test called 3P-WLTP to calculate feebates. You don’t need to worry about what that is; there’s a formula the government uses to convert different tests to 3P-WLTP, so each car is assessed in the same way.
Rebates and fines are calculated on a sliding scale. For used imports, if a car is below 146g/km, the rebate is paid on a sliding scale up to a maximum of $3450, depending on how far below that 146g figure it us. If a car is over 192g/km, a fine applies up to a maximum of $2875, depending on how far above that target it is.
That leaves an area of 146-192g/km in the middle, which is being called a “zero band’, where neither rebates nor fees apply.
How will this impact you when you’re buying your new car?
What it comes down to is what you’ll get back for your new car; or what you’ll have to pay.
You can check on the government’s RightCar website what the potential rebates or fees are for individual used import models, as well as the official safety ratings (three star or better for a rebate, remember).
Super-thrifty models with electrified technology attract the biggest rebates. The buyer of a 2011 used Toyota Prius hybrid could receive up to $1140 back after purchase, for example. Plug-in electric-hybrid vehicles like a used Mitsubishi Outlander PHEV do even better, up to $2450.
Conventional petrol or diesel models are more likely to span different brands, so it pays to research the particular version you’re considering. A popular car like a used Mazda Axela (2013 - 2018) could get a rebate of up to $666, but also attract a fee of up to $2875 if it’s a larger-engined/higher-performance version. However, a diesel Mazda Axela is more likely to sit in the zero band – no rebate or fine.
Larger-engined models are more likely to attract fees, particularly if they are older. A 2007 used Nissan X-Trail diesel could be subject to a fee upwards of $992, or $1035 for the petrol version. A newer model, such as a 2017 used Nissan X-Trail petrol, could attract a lesser fee of $776.
So how do I avoid a fee?
Rebates and fees vary a lot, even within different versions of the same model. It pays to pick and choose carefully, which is easier to do when you’re shopping for a popular brand like a used Nissan, used Mazda or used Toyota, where there is much more choice.
And remember that if you need to run a larger vehicle, used cars already registered in NZ do not attract Clean Car fees – and this phase of the programme doesn’t start till 1st April 2022.