Year in review 2018: WLTP

04 January 2019

Year in review 2018: WLTP

4 January 2019

The Worldwide Harmonised Light-Vehicle Test Procedure (WLTP) was introduced on 1 September 2017 for vehicles going through type approval, however, a year later, it became the standard for all vehicles sold in Europe, fully replacing the New European Driving Cycle (NEDC).

The introduction caused issues for manufacturers and suppliers alike in 2018, as well as potential confusion for consumers, and sent monthly registrations into fluctuation during the latter half of the year. Autovista Group’s Daily News Brief made sure the industry was kept up to date with all that went on throughout its introduction.

The new procedures are in response to the Dieselgate scandal and aim to mix both laboratory testing and real-world driving emissions (RDE) to measure a vehicle’s efficiency. Every possible iteration of a vehicle must be tested, a process that can add considerable time to getting approval. Manufacturers also had to get to grips with the differences in data between the two tests.

In January 2018, Daimler released a statement to highlight how much commitment an OEM requires to pass through the new test. WLTP certification requires around twice as much time and effort as certification under NEDC. The very extensive relevant regulation (over 700 pages) contains many different individual tests and entirely new procedures. The requirements for conducting the tests, and evaluating and documenting the results are significantly higher. The time and effort spent on each test have also risen sharply.

Production issues

As early as March, vehicle manufacturers were warning that the introduction of WLTP would impact both production and profits. Volkswagen (VW) warned of bottlenecks in its facilities as it waited on the outcome of tests, while BMW suggested that it would temporarily stop production of some models in May, because of modifications required, so their vehicles comply with the RDE portion of the tests.

Renault CEO Carlos Ghosn warned that WLTP would impact the automaker from September this year to April 2019. ‘We have a lot of uncertainties. We don't know how quickly the type approvals will be given. We don't know if customers will be willing to pay the new prices because we need to add technologies,’ he said.

Porsche was also fearful of production delays, wanting to slow down manufacturing while it awaited results of WLTP testing on its models.

VW’s worst fears were realised in August as the carmaker suggested that half of vehicles across the group were not ready and would miss the 1 September deadline. This included the popular Golf model, which was therefore withdrawn from sale until the end of September when it passed through the procedure.

Sales fluctuations

With vehicles registered after 1 September 2018 having to be WLTP compliant, manufacturers had to deal with the outstanding stock, which meant selling them before the deadline or recalling them for retrofitting before offering them back for sale. Retrofitting would have a significant financial impact, meaning discounting and pre-registration was required in August. This saw the eighth-month record higher than average registration results in Europe, with a 31.2% increase in passenger car demand, translating to 1.1 million vehicles.

All of the big five markets saw large increases in passenger car registrations, topped by Spain (+48.7%) and followed closely by France (+40%), Germany (+24.7%) and UK (+23.1) Italy (+9.5).

However, the rush for sales in August, coupled with supply issues, meant that September saw a market crash. During the month, registrations dropped by 23.5%, with 1,091,220 units sold, while the five main markets saw double-digit drops.

September’s results also gave an opportunity to see which manufacturers were most prepared. VW Group saw a 48% decline in sales due to its issues, while PSA Group, which had stated its vehicles were ready for the deadline, only saw a decline of 7.7%. Toyota only saw a small sales drop of 1.2%, while Korean company Kia, and Sweden’s Volvo posted increases, with both achieving a 2.9% rise in registrations.

VW’s struggles continued into October. Although most of its vehicles had passed WLTP by this time, the slowdown in production and need to push customer deliveries back meant it was still down 10% compared to the previous year.

Financial hit

Vehicle parts supplier Valeo cut its 2018 profit outlook, blaming vehicle production delays due to WLTP procedures. The company supplies transmission parts, lighting, sensors, wiper blades and more to a number of carmakers to fit during their production processes. However, due to slowdowns, suspensions and bottlenecks, parts were not needed.

Daimler revealed profits in the three months to September 2018 were 27% down on the same period last year, the company making just €2.49 billion.

Volkswagen (VW) Group profits fell 19% in Q3, while WLTP issues also had an impact on dealers, as vehicles were sold at a lower price due to pre-registration, and models were not available due to the need to pass the new standard.

Worries

A joint letter from two European Commissioners suggested in July that WLTP figures could be inflated by some manufacturers to improve their chances of meeting post-2020 CO2 targets. Inflated WLTP emissions in 2020 would result in less strict CO2 emission targets applying in 2021. As this also acts as the starting point for the 2025 and 2030 targets, such inflation would, in turn, lead to lower real-life emission reductions in the target years.’

Meanwhile, the European Automobile Manufacturers Association (ACEA) used the RDE portion of the test to highlight how clean, modern diesel vehicles are, following the publishing of a study stating otherwise. The body highlighted that findings we taken from tests carried out between 2011 and 2017 and that the new WLTP regime gave a better example of how a vehicle performs.

Optional extras

The new test meant that every possible model combination needed to be tested. Manufacturers suddenly realised that to ensure quicker compliance, optional extras and vehicle variants needed to be streamlined. At VW, from August, a total of 36 model versions of the Up! city car, the Tiguan SUV and the Arteon coupe were removed from sale, while BMW took 20 models with manual transmission out of its range.

Analysis by Autovista Group into the impact of optional equipment on WLTP emissions figures found that most options in isolation do not have a major impact on CO2 emissions, rarely accounting for more than 1g/km of additional CO2. 

Fitting a tow bar can increase CO2 emissions by 1-2g/km. A panoramic roof generates a similar effect. An increase in wheel size impacts the weight and rolling resistance of the car; fitting 18” wheels instead of 17” wheels adds about 2g/km more in CO2 emissions. Fitting run-flat tyres as an option instead of the standard tyre repair kit also increases emissions by about 1g/km. It is therefore easy to see how a combination of options can add up to make a difference to the emissions profile of a car and, in turn, its tax liability