Possible Euro 6 pothole for popular parallel imports

Singapore

PARALLEL importers doing a roaring business in popular Japanese models face a very "fine" problem in two months' time.

It is understood that some of their bestsellers, such as the Honda Vezel Hybrid and Toyota Estima, may fail to meet the Euro 6 emission standard due to excessive fine particulate matter (PM 2.5).

New petrol-driven cars sold here have to adhere to the Euro 4 emission standard. But from Sept 1, 2017, the stricter Euro 6 benchmark will be applied.

The bulk of parallel imported (PI) cars sold are Japanese domestic models, with current versions based on the JPN 2009 emission standard. For JPN 2009 Japanese cars with port fuel injection (PFI) petrol engines, the National Environment Agency (NEA) will accept them as meeting the Euro 6 emission standard.

JPN 2009 does not officially test for PM - only carbon dioxide (CO2), hydrocarbons (HC), carbon monoxide (CO) and nitrogen oxides (NOx).

But if the Japanese parallel-imported car has direct injection, a PM report has to be submitted to show that it is Euro 6-compliant on top of its JPN 2009 certification. This will require the car to be PM-tested in Singapore at Vicom Emission Test Laboratory (VETL).

VETL's machinery has been calibrated for Euro 6 certification and it is understood that some PI cars recently submitted for testing exceeded the Euro 6 limit for PM.

"If a direct-injected model cannot meet the PM limit, then this car cannot be sold in Singapore anymore and it will be a big loss," said Anthony Tan of parallel importer Ideal Motoring.

But Neo Nam Heng, honorary adviser of the Automobile Importer and Exporter Association (Singapore), is less pessimistic. "The whole market is confused about the testing results because of the formula applied to calculate the emission values," said Mr Neo, who is also chairman of the Prime Group of companies.

Adding that the industry has to wait for the authorities to confirm the calculation method, he said: "I strongly believe that almost all PI cars will pass the Euro 6 standard. So importers do not need to panic."

PI cars accounted for one out of every five of the 22,315 new cars registered in the first three months of 2017, and the Honda Vezel was the top PI model.

Even if parallel importers manage to clear this year's Euro 6 hurdle, they may find another obstacle in next year's implementation of the Vehicular Emissions Scheme (VES).

Like the current Carbon Emissions-based Vehicle Scheme (CEVS) for all new cars, taxis and newly imported used cars, there are financial incentives and disincentives. But unlike CEVS, VES is more stringent; it tests five pollutants instead of just one, with tightened rebates and surcharges.

Under VES, PM will be measured from July 1, 2018 and many models which receive CEVS rebates are expected to lose them under VES because of this particular pollutant.