Decarbonising Transport2nd exporting countries stakeholders group meeting
February 22, 2021
Intergovernmental organisation
• OECD framework, 62 member countries
• More than 70% of road transport 80% of global air transport
and 90% of maritime
Think tank for transport policy
Data and statistics
Knowledge sharing
Annual Summit, largest gathering of transport ministers
Corporate Partnership Board
Current focal areas
The ITF
traffic safety data
2021)
ADB, SSATP ….
Used vehicle trade: overview
Despite relatively little attention, trade of used vehicles plays a major role in total
passenger vehicle imports/exports is a significant part of global vehicle trade
Trade in used vehicles tends to flow from high-income countries to low-income countries
› Canada/United States, Europe and
main importers
disposal)
countries
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Seen from importing countries
Effects of used vehicle trade differ and depend on the specific circumstances
› Vehicle producing countries may see sales and prices of new vehicles depressed,
with a negative impact on the auto manufacturing industry
› Countries that do not produce cars may have net benefits thanks to increased
variety of offer and lower prices
Negative impacts are due to detrimental effect often coupled with personal vehicle travel
(accidents, noise, emissions, congestion) and depend on the policy context
› Impacts on use of better vehicle safety features and noise/emission mitigation
depend on the way vehicles (including used imports) are regulated
› Enforcement of vehicle maintenance requirements also matters
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Seen from exporting countries
Possibility to still recover value from vehicles that would otherwise be worth very little
Some effects on increase of domestic used vehicle prices and used vehicle exports
› Bot easy to see what this means for new vehicle sales (higher value for used
vehicle trade may increase new vehicle sales, but it also lowers value of new
vehicles being sold)
› Net impacts vary also based on market size (higher impacts for small domestic
markets – e.g. Japan – with large export demand)
Risk to bypass costs and enforcement of national requirements
› End-of-life recycling (more lucrative and cost-effective to export used vehicles than
to formally scrap them)
› Required maintenance (export of broken/not roadworthy vehicles)
› Also potential opportunity for more advanced technology (e.g. hybrids) to reach
developing countries earlier 7
› Economic measures: higher tariffs for used vehicles, fiscal instruments like
differentiated taxation on the first registration of second hand vehicle imports (e.g.
based on safety equipment or environmental characteristics)
› Regulatory instruments: license requirements to legally import a used vehicle, bans
on vehicles not meeting specific requirements (e.g. on safety and/or environmental
characteristics), complete ban
› Communication instruments: labelling
› Regulatory instruments: license requirements to legally export a used vehicle, bans
on vehicles not meeting specific requirements (e.g. on safety and/or environmental
characteristics)
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Importer perspective
Currently, complete bans mostly to protect domestic production and sales of new
vehicles
› Protection of local industry: in many developing countries, the least expensive new
vehicles are often locally produced
› Protection of new vehicle dealers, in countries that do not produce vehicles
› Bans could have a detrimental effect due to delayed access to better connectivity
(higher barriers to access to vehicles, which can enable better connectivity)
Need to consider balance between vehicles, modal allocation and infrastructure when
looking at connectivity, though…
Policies (not only bans) can also help address negative impacts (accidents, noise,
emissions, congestion)
Complete ban
Powertrain technology
(e.g. diesels)
Often still based on rather crude criteria, there
is room for improvement
Lack of a valid roadworthiness certificate
Problems with the emissions control system
Tampering: from odometers up to removal of catalytic converters
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Age limit
Exporter perspective
Effective enforcement of end-of-life requirement
› Will gain importance with circular economy and greater relevance of materials
embedded in EV batteries
› Greater capacity available to assess roadworthiness and respect of environmental
performance (but higher cost)
Opportunity to maximize positive impacts of second hand vehicle exports on
development (connectivity, air quality, energy efficiency), if trade is well regulated, while
also limiting negative impacts (depreciation)
Differentiated treatment favouring vehicles with bets environmental performances can
help supporting the efforts made in exporting countries to meet environmental goals and
stimulate innovative technologies (through effects on depreciation)
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Used vehicle trade: are there better criteria?
Examples of possible improvements enabled by selected limitations to exports and the use
of better criteria:
Making a difference between waste and acceptable vehicle conditions (roadworthy,
respecting requirements imposed by periodical technical inspections)
› Road safety improvements
› Environmental/health related improvements (air quality, climate)
Better match between vehicle and fuel standards in receiving countries (air quality)
Greater sophistication on the assessment of performance
› Better quality checks than those enabled by existing import regulations
Complement policies aiming to steer used vehicle trade in importing countries
› Especially relevant in cases where these are not really in place, or poorly
implemented
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Can WP.29 help set better criteria?
Advantage of broad and internationally agreed set of regulatory texts (readily available)
on safety (roadworthiness) and environmental performance
› Enabler of cost reductions, important for trade facilitation
› Definitely allowing to set more sophisticated criteria on used vehicle trade, to
maximise opportunities best practices and/or avoid poor practices
Barrier: need to be a contracting party (or become one) to the WP.29 agreements
› 1958: UN Regulations on type approval and the mutual recognition of the type
approvals and conformity of production of vehicle equipment and parts
› 1998: UN GTRs with globally harmonized performance-related requirements and
test procedures (also used in UN Regulations)
› 1997: UN Rules on periodical technical inspections of vehicles in use and their
reciprocally recognition of international inspection certificates
Accession to the agreements likely to come with other advantages to set policies on
vehicle performances (e.g. fuel economy, pollutant emissions…) and much less costly:
better to piggyback than to re-establish a complex regulatory framework 13
Thank you