The New Zealand vehicle fleet: fact and fiction

Iain McGlinchy. Principal Adviser Nov 2017

In 2016 4.7 million kiwis owned:

• ~4,000,000 vehicles of all kinds (not including trailers)• ~ 3,000,000 light petrol vehicles • ~ 650,000 diesel powered light vehicles

► mostly vans, utes light trucks and 4WDs (very few cars)

• ~ 145,000 diesel heavy vehicles (trucks and buses)• ~ 110,000 motor bikes• ~ 30,000 mopeds

► 2

In 2016 4.7 million kiwis owned (cont):

Among these are:• ~ 18,000 hybrid vehicles (~0.5% of the fleet) NB This is an underestimate• ~ 2,900 CNG powered light vehicles• ~ 5,000 LPG powered light vehicles• ~ 2,800 electric light vehicles (ie cars) NB 5479 as at Nov 2017• ~ 75 electric trolley buses• ~ 1 electric truck (now might be 2 or even 3!)• ~ 780,000 vehicles made in 1996 or older (ie 20% of the fleet is more

than 20 years old) • ~ 120,000 vehicles made in 1980 or older (ie 3% of the fleet is more

than 35 years old)

► 3

The NZ vehicle fleet

• About 92% (3.7 million) of our vehicles on road are light vehicles (ie cars, 4WDs, vans, utes and light trucks)

• Just 4% are heavy

Light passenger

78%

Light commercial

14%

MCycle4%

Trucks4%

Bus0.3%

Make up of the fleet (2016)

Light passenger

Light commercial

MCycle

Trucks

Bus

► 4

Light passenger

fleet64.8%

Light commercial

15.1%

Motorcycle0.4%

Heavy fleet21.5%Source : VFEM (Vehicle Fleet Emissions Model) 2

The NZ vehicle fleet: where is the fuel used?

► The 4% (~145,000) that are heavy vehicles responsible for ~ 21% of fuel used ► The 14% light commercials use around 15% of the fuel

Percentage fuel used (2016)

► 5

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

19

63

19

66

19

69

19

72

19

75

19

78

19

81

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84

19

87

19

90

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93

19

96

19

99

20

02

20

05

20

08

20

11

20

14

Number of vehicles vs population (1963 - 2016)

All road vehicles as at year end Population

Fleet size

•The size of the New Zealand vehicle fleet has been increasing pretty much since records began•In 2007, growth tapered off and remained almost flat for 6 years•But fleet size has been growing again since 2012•NZ’s population has grown since 2000s, so per capita values for ownership (and travel) fell until 2013 but have grown again since then

20072012

► 6

600

650

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750

800

2000

2002

2004

2006

2008

2010

2012

2014

2016

Vehi

cles

per

100

0 po

pula

tion

Light fleet ownership per 1000 population

Why does the fleet grow?

There is a strong relationship between vehicle imports and building consents, which are an indicator of people’s willingness to borrow

► 7

0

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Exch

ange

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e (Y

en t

o N

Z$)

Nu

mb

er o

f ve

hic

les

Monthly vehicle registrations of all light vehicles vs building consents Jan 2000 - Jun 2017

Registrations of used light vehicles All light vehicles Number of building consents issued

Vehicle fleet travel

•Travel has remained remarkably constant since 2003, despite economic changes•Growth in travel since 2013 is probably in response to increase in vehicle fleet size•Per vehicle travel has fallen pretty consistently for light vehicles over last decade

► 8

8,0008,5009,0009,500

10,00010,50011,00011,50012,00012,50013,00013,50014,000

2001 2003 2005 2007 2009 2011 2013 2015

Annu

al k

m p

er v

ehic

le

Light fleet average annual travel per vehicle (2000 –

2016)

0

5

10

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25

30

35

40

2001 2003 2005 2007 2009 2011 2013 2015

Billio

n Ve

hicl

e km

Period

Total fleet travel (2000 – 2016)

Light passenger travel Light commercial travel

Other travel

Vehicle ownership is not uniform throughout New Zealand

► 9

400

500

600

700

800

900

1000

Light vehicles per 1000 population

Significant regional variation in ownership levels

Least vehicles per capita are in Gisborne and WellingtonMost vehicles per capita are in Canterbury and Nelson/Marlborough and Southland

Least vehicles per 1000

► 10

Most vehicles per 1000

Average age varies widely throughout country

Data provided by NZ Transport Agency. It is not consistent with other age data presented here

8

9

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13

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Ave

rage

age

in y

ear

sMean fleet age of all light vehicles in local government

regions (Dec 2014)

Auckland Wellington

Auckland City

North Shore

Waitakere

ChristchurchWellington City

Waimate District

Manukau City

► 11

Average age varies widely throughout country

Data provided by NZ Transport Agency. It is not consistent with other age data presented here

8

9

10

11

12

13

14

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17

18

Ave

rage

age

in y

ear

sMean fleet age of all light vehicles in local government

regions (Dec 2014)

Vehicles get older as you go south!

► 12

Average age of light vehicles

•The trend for increasing age as you go south is not as clear if we map it •Clearly see the younger fleets in the cities•Oldest fleets are in middle of the South Island •Queenstown stands out as an anomaly•We do not know why the age increases!

Map of average age of light vehicles (Dec 2014)► Blue is younger than

average, ► Red is older than

average

► 13

Auckland

Wellington

Christchurch

Waimate District

Queenstown

The New Zealand vehicle fleet is aging!

We have an old fleet by OECD standards•Average age of light vehicles 14.12 years old•Average age of heavy vehicles 17.74 years old

Lots of stories in newspaper and online

► 14

It is true that the average age of vehicles in our fleet has been steadily rising since around 2000

Trend is aging, but perhaps not as dramatic as it looks

The fleet got younger (by 0.1 years) in 2014 for first time since 2000

► 15

10.50

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Light vehicle average age

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Light vehicle average age

What will happen to fleet age in coming years?

► Short answer is we don’t know what will happen to average age!

► The Ministry has spent a lot of time trying to model the aging of the vehicle fleet

► We found that the rates of scrappage are more important than imports, but are virtually impossible to predict accurately

► Although imports were up in 2013 over previous years, 2013 had the lowest level of vehicle scrappage since 2002!

► Scrapping has increased since 2014, but less than imports

► 16

-200,000

-150,000

-100,000

-50,000

0

50,000

100,000

150,000

200,000

250,000

2001 2003 2005 2007 2009 2011 2013 2015

Figure 5.1a : Light passenger entry and exit

Petrol NZ new in Petrol used in Diesel NZ new in Diesel used inPetrol NZ new out Petrol used out Diesel NZ new out Diesel used out

Ente

red

Exite

d

THE REAL QUESTION IS WHY IS THE NZ FLEET SO MUCH OLDER THAN OTHERS?

► 17

Theoretical age profile of a developed country vehicle fleet

0102030405060708090

100

Nu

mb

er

of

veh

icle

s

100% of vehicles enter new, then slowly leave due to accidents and mechanical reasons.

► 18

0

40,000

80,000

120,000

160,000

200,000

240,000

Vehi

cles

Year of manufacture

Light fleet vehicle year of manufacture Dec 2013

Age distribution of NZ light vehicle fleet (Dec 2013)

1996

► 19

► We have a completely disproportionate number of vehicles built 1995 – 1997

Age distribution of NZ light vehicle fleet (Dec 2016)

► 20

0

50,000

100,000

150,000

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1968

1972

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2016

Vehi

cles

Year of manufacture

Light fleet year of manufacture (Dec 2016) 2005

1996

► 1996 peak is still visible but second peak forming with surge in imports since 2013

Fleets are aging in many countries

0

5

10

15

2005 2007 2009 2011 2013 2015

Ve

hic

le a

ge (

year

s)

Average age of light passenger vehicles fleetsNZ

US Trucks

US Cars

Japan

EU

Australia

Most fleets got older, except AustraliaMainly a result of improved rust prevention

► 21

It is the bulge of Japanese used vehicles that is getting older

► 22

• Average age of NZ New vehicles is staying pretty constant (~12.8yrs) while Japanese-used rising steadily

• The effect of restricting import of used diesels in 2007 has had clear effects on average age• reducing imports does

not increase scrappage

0

5

10

15

20

25

2000 2002 2004 2006 2008 2010 2012 2014 2016

Light fleet average age by new/used and fuel type

Light new petrol light used petrol

Light new diesel Light used diesel

BUT, DOES VEHICLE AGE MATTER

Newer vehicles tend to have better occupant protection

On average, variables for road safety do improve with younger vehicles

Injury risk by year of manufacture (with 95% confidence limits)

Source: Vehicle safety ratings estimated from Police reported crash data: 2012 update Monash 2012

1996

► 24

But crashes are not related to average vehicle age

R² = 0.0005

R² = 0.1793

R² = 0.1209

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rage

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ge in

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Crashes and casualties by age of vehicles in different Council areas

Crashes per 10 000 population Casualties per 10 000 population Total fatalities

► 25

BUT WHAT ABOUT HARMFUL EMISSIONS?

Do newer vehicles produce less harmful emissions?

0

20

40

60

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100

1974 1977 1979 1983 1988/90 1994 1997/99 2002/04 2005 2009

Year of Standard

Percentage reductions in Japanese diesel emissions with changing standards

NOx PM10

► 27

► Volkswagen scandal has shown us that this may not be true either

What is happening with emisisons at a vehicle level?

• To find out what is happening at an individual vehicle level we use remote sensing which measures pollutants in exhausts of vehicles as they drive past measuring device

• Many tens of thousands of vehicles have been measured in series of research trials since 2003

• Heavy vehicles are hard to measure due to vertical exhausts!• The good news is that per-vehicle levels of harmful emissions from light petrol vehicles

are declining steadily, primarily as a result of introduction of standards

► 28

NZ New light diesel vehicles

Results from 2015 remote sensing trials (Cont)

• Of concern, is that for light diesel vehicles emissions are not falling • But, survey in 2015, Euro 6 is working!

Japanese used light diesel vehicles

In this data Japan 05 emissions are roughly the same as Euro 5

► 29

Emissions, by standard for 2015 research

BUT WHAT ABOUT FUEL USE?

Fuel use vs fleet size

• There is very little evidence that age and fuel economy are linked• If efficiency was improving, fuel use

(PJ) would decline relative to fleet size

• Since 1974 (when fuel data starts) there has been a very close relationship between fuel use and size of fleet (R2 = 0.94)

• Appears other variables, like state of economy, (or changes to fleet age) are not strongly affecting fuel use

Fuel data from “All Domestic Transport” http://www.mbie.govt.nz/info-services/sectors-industries/energy/energy-data-modelling/statistics/documents-image-library/oil.xlsx

► 31

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Total fuel use (PJ) vs total number of vehicles

(1974 - 2016)

All road vehicles as at year end

Petajoules (PJ) Domestic transport

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Vehicle age in years

Average engine size of petrol vehicles in the fleet of a given age (2001- 2016)

2001

2005

2010

2016

Engine sizes of older vehicles are usually smaller

• Until fairly recently if you replace a vehicle with a newer model, the replacement will have a larger engine.

• But trend has shifted in recent years with move away from big petrol to 4WD dieseleffect may be less important

► 32

1000

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Vehicle age in years

Average engine size of petrol vehicles in the fleet of a given age (2016)

Engine sizes of older vehicles are usually smaller

Average age of scrapping

Average age of fleetAverage age of used vehicles entering the fleet

• In 2016, it may no longer be true that vehicle entering will have smaller engine than one leaving, • if it is petrol

► 33

0

10,000

20,000

30,000

Annu

al k

m p

er v

ehic

le

Year of manufacture

Light fleet average travel in 2015, by vehicle ageLight commercialLight passengerLight fleet

On average, older vehicles travel less

Average ageof scrapping

► 34

23,600 km/yr

17,200km/yr

8,600 km/yr

14,900 km/yr

• If you replace an older vehicle with a younger vehicle, on average it will travel further• This relationship has not changed noticeably since 2000

12,100 km/yrAverage age of vehicles

Quick conclusions

• This means, that on average, if we had a younger fleet (as a result of actively getting rid of our existing older vehicles) the resulting fleet would probably have a larger engine size and travel further than our current fleet!

• Actively intervening to create a younger fleet to reduce CO2 emissions, would probably not work

• However, if the size of the fleet shrinks as older used vehicles are scrapped (and if they are not replaced) then fuel use may also fall

► 35

Quick conclusions (cont)

• MOT analysis also shows that the increased risk (exposure) from increased travel means safety disbenefit from adding newer vehicles -unless they have a very high standard of safety

• If newer vehicles travel further this also means that policies that are related to how far vehicles travel (eg total fuel consumption and exposure risk) will get greater befit from focussing on new vehicles.

► 36

Age of the fleet is not what you are looking for

• While the average age of the fleet has risen in past 10 years, the age of scrapping has not changed markedly.

• This means that we turn over vehicles about the same age as Australia or US

10

12

14

16

18

20

2001 2003 2005 2007 2009 2011 2013 2015

Aver

age

age

(yea

rs)

Average light vehicle scrappage age

NZ new lights Used lights

► 37

Average travel is a more useful variable

• Distance is a better predictor of scrappage than age, as people dispose of vehicles due to mechanical failure, not age

• Distance travelled over vehicle life time has steadily increased since 2000

• We don’t know why Japanese used vehicle total travel is lower

0

50,000

100,000

150,000

200,000

250,000

Aver

age

km

Year

Final odometer reading of vehicles leaving the light fleet

NZ new Used import

► 38

“WHY DON’T WE RUN A SCRAPPAGE SCHEME?”

Costs and benefits of scrappage scheme

• In 2007 and 2009 the Ministry of Transport ran scrappage schemes in which we offered small incentives to encourage people to scrap their vehicles.

• Trials were run in Auckland, Wellington and Christchurch• Analysis showed that the monetised benefit of removing

a vehicle 12 months earlier than it would otherwise have been scrapped were in the order of $20 to $120.

• Greatest safety gains were in using PT, which is much safer to use than private motor car

• Trade Me data from 2014 (most recent available) said average sale price of car more than 15 years old is ~$2,000

• http://www.transport.govt.nz/land/vehiclescrappageschemes/

► 40

BUT HAVEN’T VEHICLES GOT MORE EFFICIENT OVER TIME?

► 41

Efficiency vs weight

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we

igh

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Fuel economy and weight of selected Holden Commodore models 1980 - 2002

City highway Weight (kg)

Data provided by Australian govt official (pers com). Checked against published figures where

possible.1972 Toyota Corolla 1.2l 2016 Toyota Corolla 1.8l

1972 Honda Civic 1.2l 2016 Honda Civic 1.8l

Much of the benefit of increasing technical efficiency has been traded off against weight and increased power

► 42

Efficiency vs weight

Source: http://www.epa.gov/otaq/fetrends.htm

US data suggests fuel economy (MPG) actually got worse between 1980s and mid-2000s

► 43

Divergence between rated fuel consumption and real realworld in independent European testing

Source: http://www.theicct.org/sites/default/files/publications/ICCT_LabToRoad_20130527.pdf

• European research also shows that steady divergence between fuel economy measured by manufacturers compared with results from real world driving

• Strong suggestion from this and Japanese data that manufacturers build cars to pass the test, not for real world

• This may partly explain why we are not seeing expected changes in the fuel economy in the real world

• Also, other variables, like congestion may also have gotten worse over this time

► 44

All light petrol vehicles – divergence in FE (%)

► This is data from MOT research comparing real word fuel use vsmanufacturers published figure

► A small number of petrol vehicles are more fuel efficient than would be expected from the type approval numbers

► There is some correlation between real-world and type approval FE values

0

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0 4 8 12 16 20 24

FC_NEDC

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NIV

EHY = 0.81X + 2.78; R2 = 0.55

Fuel consumption (drive cycle) l/100km

Fuel

con

sum

ptio

n (re

al w

orld

) l/1

00km

► 45

Light petrol vehicles: Divergence in fuel economy

►The trend for vehicles to use more fuel than test values state is clear for NZ light petrol –divergence is increasing

% difference (Mean)

% difference (Median)CC difference (Mean)CC difference (Median)

► Data from 2015 MOT study of real world fleet fuel use: http://atrf.info/papers/2015/files/ATRF2015_Resubmission_9.pdf► 46

Contact

Iain McGlinchyPrincipal AdviserMinistry of Transport (021) 918 156i.mcglinchy@transport.govt.nz

www.transport.govt.nz

► 47