Romanians struggling with their diesels

Date: 07.08.2018
Author: Monica Dona

How do other countries treat the problems the Netherlands faces? Automotive asked Dutch automotive specialists around the world to share their experiences. In this second edition of our summer column series: Philip Aarsman, the managing director of Business Lease Romania, talks about the diesel “drama”, the approach to air quality and the fear of environmental zones.

Philip Aarsman has been working for Business Lease since 1997 and since 1989 for the holding company Autobinck.

“Romania is an impressive country with a lot of beautiful nature. For example, it has the largest bear population in the wild in Europe. In the Carpathians, the mountain range that crosses Romania, you can even find primeval forests. But air pollution in the cities is a steadily growing problem. The European Commission has therefore decided to refer Romania to the EU Court of Justice because the country does not meet air quality standards imposed. We mainly discuss about nitrogen (NOx), soot and dust particles and the diesel engines that do not help at all.

That is why Romania needs to take actions immediately. The so-called ‘pollution tax’, a new registration tax for both new and used cars, has already been postponed by politicians twice. But even if the law were approved, its long-term effectiveness is questionable. When the law comes through and the tax is going to be a substantial amount, many people will no longer be able to replace their car, so we can expect the average age of the car fleet to increase and so the pollution caused by traffic. Furthermore, on long-term we expect the prices of diesel cars to decrease, causing thus extra-concerns.

For business use, the diesel engine has up to now been the most favourite choice and in our order intake, this share always amounted to more than 90 percent in the past. As diesels are not taxed differently from cars with petrol engines, it was natural that the balance in terms of fuel consumption was more favourable to them. Nevertheless comparing the intakes on the first half of the year with the homonym period last year a 20 percent (10 percentage points absolute) drop down in the number of new diesels could be observed. This abrupt development cannot be explained otherwise than by the negative sentiment or fear of what may come.

Registration percentage of new cars diesel/petrol 2018 versus 2017 period January to June.

Percentage of diesel cars

We expect the prices of diesel cars to decrease on long-term and, anticipating the situation in Western Europe, we actively encourage the choice for cars with petrol engine (and/or petrol hybrid combination). In many cases it appears that on the long term the investment in vehicles with petrol engines is more favourable compared to a diesel-powered car.

On the other hand, we do see that municipalities are gradually taking steps towards replacing their old diesel buses with electric vehicles. The second city of the country after Bucharest, Cluj-Napoca in Transylvania, is at the forefront of this. In this place, where Business Lease also has a branch, the electric car will soon enjoy a privileged position. For example, citizens will be able to use the bus lane just like taxis and have access to unpaid parking spaces (with charging points). Just like in the Netherlands and Germany, local authorities try to find solutions if the national government does not do enough to improve air quality.

Philip Aarsman has been the managing director of Business Lease in Romania for more than three years. The Company started in Romania after the acquisition of the local player FMS, in December 2014 and their expansion was a (logical) continuation of the existing activities in Central Europe (Poland, Czech Republic, Slovakia and Hungary). In total, the number of Business Lease contracts in CEE now exceeds 33,000 vehicles and the Romanian fleet has 3,100 vehicles. The portfolio consists of a mix of larger international companies as well as local small and medium-sized businesses. Aarsman has been working for Business Lease since 1997 and since 1989 for the holding company AutoBinck, holding various positions in various countries.”

Article published in Automotive-Market

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