Consumers may end up paying more for new cars when scrappage laws come into effect in just over 12 months' time.
By January 2007, motorists across the European Union will be able to dispose of cars in an environmentally friendly way by bringing them to licenced operators for breaking and recycling free of charge.
Under the European Commission End-of-Life Vehicle (ELV) Directive, manufacturers and importers of cars are to be liable for the cost and not the last owner of a vehicle.
But the Society of the Irish Motor Industry (Simi) yesterday refused to rule out a situation where extra costs would be passed on by car producers to consumers buying new cars.
Simi chief executive Cyril McHugh said that it was in the motor industry's best interests to keep prices competitive, but added: "We're looking very closely at the costs. If there is a negative value on an [ end-of-life vehicle] the onus is on the manufacturer." Asked if it was a possibility that this cost would be passed onto consumers, McHugh said: "Our desire is to avoid that situation. Hopefully we wouldn't have to get into that situation. But I wouldn't like to say that there wouldn't be an extra cost."
McHugh pointed out that pricing was a "matter for each individual brand" but said any such increase would not be desirable for car sellers. "For one thing it would be subject to VRT," he added. Simi is campaigning for a reduction in vehicle registration tax in the December Budget.
Dr Tom Roche of Galway-Mayo Institute of Technology said he "assumes" the cost will be passed onto the consumer just as it has been for the disposal of electrical goods under the Waste Electronic and Electrical Equipment (WEEE) directive.
Dr Roche is co-ordinating a project which will provide training for car firms on how to be compliant with legislation in a cost-effective manner. Several manufacturers are examining a piece of software developed by a GMIT campus company which allows manufacturers to work out in the design stage if a car will be compliant with recycling laws.
"It will be passed on in some form. At the moment take WEEE as an example, you have to pay €20 per item," Dr Roche said.
"So if you're modelling this on WEEE, you would imagine the cost will be passed to the consumer." He said the estimated cost of disposing of an end-of-life vehicle is €300. The Department of the Environment, scrappage companies and Simi are engaged in talks about the logistics of establishing a network of approved dismantling centres by the start of 2007.
McHugh is confident the 2007 deadline will be met and that take-back facilities will be in place for motorists. "Contracts will be signed. I think we're on target." In Britain, a network of licenced scrappage centres has already been established by Autogreen, one of a handful of companies running take-back services there. Autogreen has signed contracts ahead of the 2007 deadline with major car manufacturers including Toyota, Suzuki, Vauxhall, Saab, BMW and DaimlerChrysler.
The EC directive also requires that by January 2006, 85 per cent of an old car is recyclable, rising to 95 per cent by 2015. Manufacturers are already making cars to be in compliance with the 2015 laws.
