Hon David Parker
Minister Responsible for Climate Change Issues
Minister of Energy
Hon Judith Tizard
Associate Minister of Transport

7 November 2006
Media statement

Embargoed to 12.30pm Tuesday 7 November 2006

Cars for sale to have fuel efficiency information

Speaking at a Parliamentary function for the AA EnergyWise Rally today, Energy and Climate Change Minister David Parker released a discussion document on a mandatory fuel economy labelling scheme for vehicles at point of sale.

The Government proposal aims to give consumers more information about the fuel efficiency of the cars they're considering buying, as a way of reducing greenhouse gas emissions and improving air quality. The proposed scheme will cover all cars (new and used) for which fuel efficiency information is available.

It is intended to apply at point of sale through registered motor vehicle dealers. Consideration is also being given to how it could be applied to sales via internet sites like TradeMe.

David Parker said vehicle use is one of the major contributors to New Zealand’s greenhouse gas emissions, and vehicle emissions also have a negative impact on air quality, urban amenity, and human health.

“Providing consumers with better information will mean that they can choose more fuel efficient cars, which will also save them money at the pump. Encouraging people to buy vehicles that use less fuel will also help us reduce the greenhouse gas emissions that contribute to climate change."

The Associate Minister for Transport, Judith Tizard, says: "Vehicle Fuel Economy Labelling is complementary to other government measures designed to clean up New Zealand vehicles, such as the recently-introduced smoky vehicle check required when cars obtain a warrant of fitness."

Decisions on the new Vehicle Fuel Economy Labelling scheme will be aligned with other work underway to improve the fuel economy and emissions performance of New Zealand vehicles.

The closing date for responses is 21 December 2006.

The discussion document is available at www.eeca.govt.nz

ENDS

Background

Is fuel economy important?
There have been several price rises in fuel earlier this year, and petrol prices are still at a higher level now than what they have been in the past. Fuel costs are now significant for many everyday New Zealanders, and labelling of cars is one way to better inform people about the running costs of vehicles.

Improvements in the fuel economy of the fleet will also have a positive effect on New Zealand’s overall carbon dioxide emissions and therefore reduce our impact on climate change.

What is Mandatory Vehicle Fuel Economy Labelling?
It means that there would be a requirement for fuel economy information to be displayed on specific vehicles under 3.5 tonnes that are covered by the scheme, when sold by motor vehicle traders.

Are there schemes like this overseas?
Vehicle fuel economy schemes have been introduced in many countries overseas, and some of these are outlined in the document. They are currently in place in Australia, the European Union, California, Canada and elsewhere.

What will the labels look like?
The feedback received from the discussion document will help determine what information is required for vehicles at point of sale, and in what format.

Consumer research is also being completed which will provide useful information on preferred content and format of any labels at point of sale.

What information will they have on them?
Some of the options include fuel costs associated with running the vehicle, litres per 100km, a star rating or some other comparative grading system. The final decisions on this will depend on the results from the submissions and consumer research.

Will labels be required for both new and used cars?
Yes, when sold by registered motor vehicle traders, and subject to information for that vehicle being available through the fuelsaver website. To start with, information will be available for all new cars, most late-model used cars, and many older cars. Information gaps will be filled over time so that eventually informations will be supplied at point of sale for all cars being sold.

Where does the fuel economy information come from?
Importers are currently required to supply fuel consumption information to Land Transport New Zealand. Most of this information is based on tests conducted in the European Union or Japan. This information is then fed into the fuelsaver website.

When will it be in place in the market?
The aim is to introduce a scheme by mid to late 2007.

What is the government already doing to promote fuel economy?
The government has set up the fuelsaver website www.fuelsaver.govt.nz. The site provides consumers with fuel economy information about all new vehicles and many used vehicles on the New Zealand market, as well as driving tips for improving fuel economy.

Land Transport New Zealand is also working in the area of Travel Demand Management.

The Transport and Environment Ministries are also working to improve the efficiency of the Government’s fleet of vehicles.

Will information be required to be provided for older cars?
Only where the information is available through the fuelsaver website. Information is likely to be needed when the information is available for the vehicle being sold, and the vehicle is being sold through a registered motor vehicle dealer or over the internet.

How do I know the information is correct?
The manufacturer has declared the information to be correct, or for Japanese used cars the information has been purchased from the Japanese Society of Automotive Engineers.

Labelling legislation would likely include offences for presentation of information that is false or misleading. It is not yet clear who would enforce such regulations.

ENDS

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