On Road Costs now more important than ever before – AA

1 April 2022

On Road Costs now more important than ever before – AA

Car buyers in New Zealand will now need to be much more aware of the emissions a vehicle puts out with the Government’s Clean Car Discount scheme coming into effect today.

The scheme will not apply to vehicles already on the road in New Zealand but will affect all new or used vehicles of less than 3.5 tonnes that are registered from now.

Vehicles that emit less than 146gCO2/km will receive a rebate while vehicles that exceed 192gCO2/km will incur a fee. Anything between these limits would neither receive a rebate nor attract a fee at this point.

“The changes are likely to mean some vehicles become more expensive to buy while others become cheaper,” says AA spokesperson Terry Collins.

“We expect it to have a significant impact on prices in the car market and it’s going to be really important for people to understand all the costs that may be involved when they look to buy their next vehicle.”

People buying cars through dealers will have likely seen the phrase ‘plus on road costs’ or ‘+ORC’ after the price but it will now be even more important for customers to be clear on how much this will make the full purchase price.

The ‘on road costs’ will now usually include the fee if a vehicle emits more than 192gCO2/km and that could be as much as $5,175 for new vehicles or $2,875 for used imports.

“People may be used to ‘on road costs’ being a relatively small amount in the past but they now could be much more significant,” says Terry.

“If you aren’t clear on what any ‘on road costs’ are, don’t agree to buy it.”

To help buyers understand if they would be getting a rebate or paying a fee, the current Vehicle Fuel Economy Label is being replaced with a new Vehicle Emissions and Energy Economy Label (VEEEL). This label will clearly show the amount of rebate or fee that applies to the vehicle.

The AA cautions people buying a car online to be particularly careful and make sure they know the full cost of purchasing a vehicle before pushing the buy now button. If you have any doubts communicate with the vendor to ensure you know the full price including any fees or rebates.

More information on the Clean Car Standard is available here: https://www.aa.co.nz/cars/motoring-blog/the-clean-car-story/


For more information contact:

Terry Collins
Principal Policy Advisor
New Zealand Automobile Association
M. 027 223 4028
E. tjcollins@aa.co.nz  


The New Zealand Automobile Association is an incorporated society with more than 1.8 million Members. It represents the interests of road users who collectively pay more than $2 billion in taxes each year through fuels excise, road user charges and GST.

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