European Laws Following Article 50

Tuesday, 17. January 2017

What happens to the laws being introduced by the EU after Prime Minister May has started the Brexit process by enacting Article 50? Over the next couple of years, called the transition period, the EU will impose laws on all member countries but where does it leave us as we will still be part of the EU for two years after Article 50 is passed through parliament?

Take the European Court of Justice ruling in the Vnuk case. A Slovakian man was injured when a tractor reversed into a ladder that Mr Vnuk was on. Insurers refused to pay up as the accident happened on private land so it was up to Mr Vnuk to sue the driver privately for his injuries.

His claim went through the courts and failed at eac level until it was referred to the European Court of Justice. The European Court of Justice ruled in 2014 that it was compulsory for all vehicles to have insurance, whether on the road or not, and whether used as a vehicle or machine, which should have therefore protected Mr Vnuk.

The EU’s Motor Insurance Directive states that vehicles such as lawnmowers, disability scooters and golf buggies should all carry insurance, much to the annoyance of our own insurance industry. The Government is, as a result, consulting about changes to the Road Traffic Act in order to meet the EU regulations.

Having expressed concerns regarding the cost of conforming to the EU regulations it would seem that as we are expecting to be outside the EU when the changes have been formalised the lawmakers have introduced a ‘sunset’ clause which means that changes to our current laws, as a result of this directive, can be immediately ditched the minute we Brexit. What a waste of time and money.

The question is how many more regulations will be introduced with ‘sunset’ clauses incorporated into the UK laws before we fully exit the EU? And where do we stand when European workers come into the UK to work on farms and experience similar accidents, will we need regulations to cover UK workers and others to cover EU workers and will UK workers be happy to be refused the same protection as those working in EU countries? And so my concerns about the full implications of Brexit continue. By Graham Hill

Warranties, Guarantees And The 2 Year EU Guarantee Rule

Tuesday, 20. December 2016

As things stand at the moment whilst we are still members of the EU, a 2 year guarantee is your minimum right on anything you buy. National rules in your own country may give you extra protection, however, any deviation  from the EU rules can only happen if it is in the consumer’s best interest.
If goods you bought anywhere in the EU (any of the 28 member states, Iceland, Liechtenstein and Norway) turn out to be faulty or do not look or work as advertised, the seller must repair or replace them free of charge or give you a price reduction or a full refund. This does not apply to items purchased from an individual.
According to Your Europe you might not be entitled to a refund if the problem is minor, such as a scratch on a CD case or damaged packaging. I would argue that if say a bottle of perfume was purchased as a gift then the packaging is part of the product and the whole item should be replaced or money paid back.
In this country we now have the Consumer Rights Act that strengthens the consumer’s position as you have the right to reject a faulty item within 1 month of purchase and demand your money back. After 1 month and up to 6 months after receiving the goods, if a fault occurs that appears to be a fault that existed when you bought the goods you simply need to prove to the seller that a fault exists.
He has one opportunity to attempt to repair the fault, after which he must return your money if the fault remains. After 6 months and up to 6 years the onus is on the consumer to show that a fault existed at the time of purchase through maybe an independent inspection. I cover this in more detail elsewhere in this book.
Every member state has a European Consumer Centre that can help with difficulties if you have a problem with goods supplied by another EU country. They can also help with complaints against UK companies when consumers are supplied with goods that are faulty or do not look or work as advertised. You can find them here:
In the UK shops and producers tend to offer an additional commercial guarantee (also referred to as a warranty), either included in the price of the product or at an additional cost. The rule here is that it must give you the same or better protection than the EU 2 year Guarantee. It can never replace or reduce the rights you have in law.
The fascinating thing here is that the EU rules cover items bought as used (excluding purchases from a private individual). So let’s say you bought a used car from a dealer who offered the usual 3 month or 6 month warranty. If the car develops a fault that can be identified as being on the car when purchased, any time up to 2 years after the day you took delivery, you have a claim under EU law. The warranty cannot replace your legal rights only enhance them.
In another example that easily explains your position let’s say you bought a kettle with a 6 months sellers guarantee. It breaks after 8 months and you take it back to the shop. The shop assistant explains that the guarantee has run out so you are not entitled to a refund. You can point out that under EU law the shop guarantee is provided as ‘additional services’ and that the EU law covers you for 2 years. In point of fact you are also covered by the Consumer Rights Act but under our law the onus is on the buyer to prove that the fault pre-existed. Not difficult to prove as the expected life of a kettle must be in excess of 5 years.
HUGE REVELATION: Now here is a very important point that illustrates the 2 year rule. If you visit the VW website they explain, better than most, your position with their new car warranty. I should add at this stage that the 2 year rule does not discriminate against useage. So the 2 year guarantee covers you whether you cover 8,000 miles PA or 100,000 miles PA, the guarantee is time related. Back to VW. When you take a new VW you will be told that the warranty lasts for 3 years or 60,000 miles. But here’s the truth, and it applies to all cars purchased in the UK and across the EU, the first two years warranty is unlimited miles but you only get the third year cover provided you are still under 60,000 miles. Here is an extract from their site:
All new Volkswagen passenger cars purchased from an Authorised Retailer in the United Kingdom qualify for a 3 year vehicle warranty consisting of a 2 year/unlimited mileage warranty and a 3rd year warranty with a 60,000 mile limitation.
The chances are that you and many taxi drivers were totally unaware of this fact!
In some EU countries the buyer and seller can agree a guarantee period of less than 2 years but that must be fully understood by both parties and cannot be less than 12 months. I will be covering warranties in greater detail elsewhere in this book as there are various types and levels of cover. And I have a revelation regarding Manufacturer Warranties that will possibly shock you.

 

The Effect Of Brexit On Air Quality – A Warning!

Tuesday, 22. November 2016

If, like me, you are worried about the damage that pollution is doing to our environment and to the health of our children then Brexit carries with it some additional concerns. The Government has lost a legal battle in the High Court against environmental campaigners over pollution levels and now have to take action by drawing up more ambitious plans to reduce emissions.

The ruling by the High Court was the result of an appeal by the Government over a Supreme Court ruling in favour of environmental lawyers, ClientEarth who successfully argued that the Government had continually failed to tackle the national air pollution crisis.

Mr Justice Garnham, presiding over the High Court case, said that the Government had continually failed to take steps to bring the UK into compliance with European pollution laws, and that they should take steps, as soon as possible, to correct the situation. However, this is fine whilst we are within the EU but when we are outside will the Government be as keen as the Europeans to keep pollution under control?

I somehow have my doubts which must be a worry to those of us who believe, unlike president elect Trump, that humans are the biggest contributors to the high pollution levels we see around the world, through the poorly controlled burning of fossil fuels. What a doughnut! By Graham Hill

 

What Will Happen To Car Leasing Following Brexit

Tuesday, 22. November 2016

On the face of it nothing much has happened. There has been a bit of a drop off of cheap lease deals but that is pretty much down to the fact that most manufacturers will hit their new car sales targets this year with a total number of new cars sold, close to or hitting 3 million. And if you are hitting your targets why give away more discount than you need to?
You’d have to be nuts. This also means that in 2 or 3 years time when the lease deals end there will be a surge of used cars in the market just as we fully exit the EU. Good news for used car buyers but bad news for the leasing companies who have to try and predict future values.
With this in mind we have already seen an upward adjustment of rates due to two things. A price increase imposed by most manufacturers following the weakening of the pound and a re-alignment of resale values for the reason stated above. Now having said that leasing companies are very poor at predicting future values. They said that 2016 would see a slump but it didn’t, in fact used car performance this year has been particularly strong.
The problem is that leasing companies take a simplistic approach. They use a very simple supply and demand model, which for many seems to be the only way to predict the future. For example if we have sold a lot of cars this year on 3 year leases it makes sense to assume that there will be a glut of 3 year old cars in three years time, thereby driving down the price of these cars in auction and through the trade.
But my theory, and it is only my theory, is that the used car market isn’t linear. Let me explain, each year somewhere between 8 and 9 million used cars change hands. A linear approach would suggest that demand remains constant, so there will be roughly the same number of 1 year old car buyers (that’s the car not the buyer – good grief), the same number of 2 year old car buyers etc.
If we have roughly the same number of buyers of 3 year old cars in 3 years I agree that the average car price would drop. But this ignores desire. Experience has shown that as manufacturers change models more frequently there is a greater desire to have a much newer car with more gizmos fitted. So many 4 and 5 year old car buyers force themselves into the 3 year old sector increasing demand and forcing up prices.
So will we see any major changes as we exit Europe? Much depends on the trade arrangement that we negotiate. If we negotiate a strong tariff free deal it will not only ensure that we don’t have to factor in duties but that should also strengthen sterling. And with consumers mainly funding new cars on the more expensive PCP with only 5% using the cheaper Personal Contract Hire (PCH) I believe that the industry will remain generally buoyant with a few glitches along the way! You’re right I haven’t got a Scooby!  By Graham Hill 

 

What Lessons Will Be Learned By The Zafira Debacle?

Friday, 12. August 2016

In the current Health and Safety obsession by the EU and lawmakers in all civilised countries I find this next piece very hard to believe can still happen, especially in the UK. If you are a recent reader of my musings you may not have read the piece I put out regarding the sort of health and safety attitude that existed in the US in the 1970’s.

Briefly, Ford had a car called the Pinto which happened to be the biggest selling ‘sub compact’ car in the US at the time. Unfortunately the design of the car was unsafe, they had placed the fuel tank in such a position that if the car was hit from behind the tank exploded.

More than 500 people died as a result of the Pinto bursting into flames when they were either driving or were a passenger in the car. Many more received severe burn injuries. When a burn victim sued Ford for the faulty design it was uncovered that Ford engineers had known about the problem for many years. But Ford management had carried out a cost – benefit analysis and concluded that it wasn’t worth the $11 per car to fix the problem by recalling all of the cars compared to the cost of recompense payable to the victims.

They believed that if the problem remained unfixed they would face claims from 180 burn victims and the families of 180 victims killed. They placed a monetary value of $67,000 on a burn victim and $200,000 on a death. They added to these costs the cost of replacing the cars. They concluded that if they fixed the problem it would save them $49.5 million in compensation and car replacement costs but the cost of repairing the 12.5 million cars affected would set them back $137.5 million.

So they concluded that the cost of paying out for losses and injuries was a better option than paying out for the cars to be repaired. This of course raised a number of issues that the US Government jumped on and Ford ended up with huge costs and penalties to pay. One would assume that this couldn’t possibly happen again in this day and age with a higher moral obligation placed on companies along with massive legal consequences.

But then I read about the recent problems experienced by Vauxhall Zafira owners. I had seen several YouTube videos of Zafiras catching light and cars being pretty much instantly destroyed. For ages Vauxhall denied the existence of a problem but after 300 Zafiras caught fire they were forced to take a more responsible approach. The problem was found to be in the car’s heating and ventilation system which led to a recall of all Zafiras, known as ‘B’ models on sale between 2005 and 2014.

They originally claimed that the problem had only come to light in 2014, following which they instigated a full recall in December 2015. However, when questioned by MP’s a couple of weeks ago, Peter Hope, customer experience director at Vauxhall, admitted that they had known about the problem as long ago as 2009 when the first fire was reported. Their excuse was that when cars are completely destroyed by fire there is very little evidence left to analyse in order to establish the cause of the fire.

The good news is that unlike the Ford Pinto no-one was even injured but that isn’t the point. At what stage does a car manufacturer take responsibility and carry out a very detailed investigation when consistent things go wrong with one of their car models? The estimated cost of repairs is £33.6 million – tough! Only now, in the month of August 2016 is a further 235,000 Zafiras, as agreed with the DVLA, being recalled to have the fault fixed.

Shame on you Vauxhall for putting customers through all this when it could have been avoided. When Vauxhall denied responsibility drivers no doubt made insurance claims for their losses, paying an excess and losing no claims bonus. This simply isn’t good enough and after making the cars safe again they should prepare a plan to pay those affected compensation, something, according to Peter Hope is not at the moment being considered. What a disgrace! By Graham Hill

Dash Cams, Driverless Cars and Used Cars Following Brexit

Friday, 5. August 2016

Bits & Pieces: a) It seems that insurance companies are finally seeing the benefit of having a dash cam (digital camera fitted to the dashboard, windscreen or behind the rear view mirror) with dash cam maker Nextbase coming to an agreement with insurance comparison website, Constructaquote.com.

They will offer those with a dash cam fitted a 15% discount on insurance taken out through their website. This is particularly beneficial to those who privately finance a car but predominantly use it for business as these cars carry a premium that the 15% will help to neutralise.

b) The Government is looking into the proposals for driverless cars to be used on the streets of the UK. Consultations have started on the implications such as a rewritten Highway Code, street signs and the safety features such as lane departure and emergency braking. You can read the consultations by visiting www.gov.uk/government/consultations.

c) Glass’s Guide, the well known valuation experts, have suggested that the decision to exit the EU won’t affect used car prices till quarter 4 2016 at the earliest. Like most ‘experts’ they predicted the first to suffer would be fuel prices and property prices whilst I predicted – no change in my musings straight after the Brexit vote. Before the vote petrol at my local Tesco was £109.9 pence and yesterday – yep, it was the same! By Graham Hill

Revealed – How Private Is Your Personal Data In ‘Connected’ Cars?

Thursday, 26. May 2016

As I continue to wrestle with my decision as to whether we should stay in or exit the EU, I read something that kinda proves that the EU isn’t all bad. It’s been a worry of mine for some time as to what happens to all the data being collected as cars become what is being called ‘connected’.

It started with a warning that I issued a couple of years ago about your phone book that you upload into the phone memory in your car then forget to delete the numbers before you hand it back at the end of the lease or sell the car on to a dealer or private individual.

I reported a case whereby a premier league footballer’s wife part exchanged her car which contained the phone numbers of A listers which the car dealer then tried to sell on as he considered that he was now owner of the data as he now owned the car. He lost the case but we are now entering the murky world of what I referred to recently as Big Data.

You record your destinations via sat nav and with full connectivity to the Internet in many cars, expected to be in 90% of all new cars by 2020, what happens to your search history and data that is being recorded via your in car Internet connection? Not to mention facts and figures on the way you drive.

It is with regard to personal privacy that the EU has stepped in and tightened up on the controls governing personal data collected via the ‘Connected’ features of your car. Within the new rules laid down by the EU they state, ‘There will be a much higher standard for consent, the definition of what constitutes personal data will change and there will be tougher sanctions for anybody falling foul of the rules.’

The EU has given businesses 2 years to tidy up their act and comply with the new, stricter regime, which has been designed to deal specifically with issues arising from connected products and services, including amongst others, vehicles. Frans Timmermans, first vice-president of the European Commission said, ‘Individuals must be empowered; they must know what their rights are and know how to defend their rights if they feel they are not being respected.’

Whilst the rules apply to personal data various experts have suggested that the rules will extend to virtually all data as the definition of personal data is changing. According to legal expert Stephen Appt, the General Data Protection Regulation (GDPR) makes it clear that information is considered to be personal data whenever individuals can be identified by online identifiers, including GPS information. Appt, a partner at Pinsent Masons, added, ‘Data that identifies drivers indirectly would be considered personal data.’

So in essence I agree with these moves as individuals need to be protected but it raises two questions in my mind. Firstly would our own Government have tackled this problem and if they did would they impose stronger or weaker rules than the EU? But taking this one step further if we voted out and took back control over our regulations and took a weaker approach would we still be able to sell into Europe?

I would suggest that unless we met their privacy regulations we wouldn’t be able to. So we will have to comply whether we are in or out or we couldn’t sell into our largest market, Europe. It seems to me that we’re damned if we do and damned if we don’t. Take another example. If we decided that say the safety standards set down by the EU on fridges was too low and decided to improve the safety adding a £20 cost per fridge would our own manufacturers thank the Government?

We would no longer be competitive in Europe because of the added cost and it makes no difference anyway as the safety rules laid down by the EU represent a minimum, there is nothing to stop the UK, if we remain in, improving on the minimum safety standard if we felt it was necessary.

Of course we could drop the safety standard of fridges made in the UK if we were out but we wouldn’t sell any into Europe because they no longer complied and I would suggest that we would struggle to sell them elsewhere in the world as European manufacturers would declare UK product as inferior. Confused – yes I certainly am! But congratulations to the EU for tackling this growing privacy problem. By Graham Hill

Bizarre Report Suggests The Scrapping Of 80% Of Traffic Lights

Friday, 26. February 2016

Did you know that 80% of traffic lights could be scrapped without any detrimental affect on traffic flow? So says a report by the Institute of Economic Affairs (IEA). They could be replaced by filter-in-turn or all-way give way layouts at junctions (no I haven’t a clue either).

According to the report if we ditched all the unnecessary traffic lights we would avoid unnecessary delays and if this saved 2 minutes per trip it is estimated that the move would save the economy £16 billion a year. The study found that the number of traffic lights had increased by a staggering 25% since 2000.

In addition the report suggested that many bus lanes, cycle lanes, speed cameras and parking restrictions should go also – wow I’m with them on these thoughts. Cities in Germany and the Netherlands have already ditched 80% of their traffic lights successfully and the IEA believes that we could do the same.

The IEA finishes by saying, ‘The affect of these measures puts an enormous burden on the UK economy, It also imposes huge costs on road users, tax payers and communities.’ And I for one agree! By Graham Hill

Emissions Testing To Be Tightened Even Further By EU

Thursday, 25. February 2016

The EU Commission had already made it clear that emission testing would be tightened up from 2017 but they have now announced that they will be going several steps further. As a result of growing mistrust of the emissions testing procedures which were to reflect real life motoring conditions by 2017 the Commission has announced a number of additional rules.

First of all, instead of randomly selecting cars off production lines to test they will in future be selected from cars that are already on sale as well as cars from production lines. Recalls will be issued if cars are found to emit different levels of regulated emissions than those suggested by the manufacturer. Financial ties between European test centres and the manufacturers will be cut (I didn’t know there were any), thus making the system fairer.

It seemed that testing could be carried out in any country within the EU in the past for it to be accepted across the EU. So manufacturers were having cars tested at centres where they knew controls were more lax. This is being address with greater controls being imposed upon the test centres.

The Commission is also applying for additional powers to suspend, restrict or withdraw the number of services that a test centre can offer if it is performing at a less than acceptable level. The Commission is also pushing for access to new car ‘software protocols’ and the ability to restrict the use of such devices as the ‘defeat device’ used by VW. I’d have thought these sorts of devices should be banned rather than just restricted!

Whilst it seemed to be a move in the right direction there were some observers who believed the new rules still ‘lacked teeth’. In a damning statement Greg Archer, green vehicles director at campaign group Transport & Environment said, ‘Without the threat of future EU sanctions, it will be  mission impossible to break the strong bond between national regulators and their car makers that has protected the industry but at the cost of higher emissions.’

And I thought I was outspoken! The EU Parliament is now considering the proposals ahead of a debate and vote. If approved the new rules will come into force immediately = as if that could happen! Ridiculous! By Graham Hill

Graham Hill’s Euro 6 Masterclass

Monday, 15. February 2016

This week, following the VW emissions debacle, I’m going to give you a master class in understanding the new Euro 6 legislation and the effect on both petrol and diesel engines along with some relevant information that I hope you will find of use.
It’s not as boring as you might think because there has been a major change to the driver maintenance of diesel cars that you might like to consider before choosing diesel for your next car. I won’t go through the whole of the European Emission standards since they were introduced in July 1992 but I’ll touch on a couple of relevant points before bringing you bang up to date and reveal a couple of things you may not know about.
When Euro 1 was introduced it was really set up to provide drivers with information about the emissions from their new cars. Whilst limits were set for just a few of the exhaust emissions, CO2, Hydrocarbons (HC) + Nitrogen Oxides (NOx) and Particulate Matter (soot) they were more advisory rather than enforceable.
At the time there was a lot of discussion going on around CO2 and the effect on the environment but more important on the atmosphere, remember the discussions about the holes in the ozone layer? So as each new standard was introduced by the EU they changed from being advisory to statutory and more emissions became regulated. Testing standards were introduced and standard test conditions were introduced to laboratory standards.
Cars tested are not, as some believe and reported on recently, selected by the manufacturer and passed over for testing. Test cars are normal cars randomly selected from the production line and tested whilst being witnessed by Government agencies. In every case there has to be consistency. The environment is very carefully controlled.
The temperature, fluid levels and even tyre pressures are all set. This is about to change in 2017, something I don’t agree with, when they carry out measurements on the road instead of in the lab using portable measuring equipment. This will be known as Real World Driving Emissions (RDE). Really? what the hell is ‘real world’?
Its the same argument over fuel consumption figures. I can drive my car down the same stretch of road 3 days running and return three different MPG’s. Stick my son behind the wheel and you’ll return different readings again. In my opinion there is no such thing and once a car is out on the open road all sorts of dodgy things can be done to ‘fool’ the test equipment.
Anyway, back to Euro 6 which came into force in September 2015. This set the standard for petrol and diesel engine measurements and set emission limits. The limits are set for CO2, along with NOx (the gas that VW was misrepresenting), Carbon Monoxide (CO), Hydrocarbons (THC and NMHC) and finally Particulate Matter that is particular to Diesel (get it – sorry about that).
Whilst CO2 has always been the main concern of environmentalists and Governments around the world NOx has come to the fore with links to lung conditions and even premature death. These links are always debatable but assuming that the data is accurate the problem was already being dealt with by the EU with the introduction of Euro 6. The Euro 1 level of NOx was 780mg/km for diesel engines and 480mg/km for petrol.
Euro 5 saw diesel levels drop to 180mg/km, a huge drop and Euro 6 dropped the level in diesels to 80mg/km compared to 60mg/km for petrol – virtually the same. But in order to achieve this result in diesel cars an additive needs to be added to the diesel, something I’ll come onto in a moment.
There are two questions arising. Are diesels being unfairly demonised and as a driver should you be selecting petrol or diesel for your next car? Fuel consumption is still a big deciding factor for those covering high mileage but should it be such a deciding factor when most drivers are covering around 10,000 miles per annum?
Town mileage can in fact be more economical driving a petrol car compared to a diesel and with Ford working towards a petrol engine that will return 100mpg we may not be far away from the time when petrol cars are more frugal than diesel. But by then the environmentalists will complain that petrol engines always have and always will kick out more CO2’s than diesel. So what should you consider and what has Euro 6 changed?
First of all diesel’s spew out particulates, soot to you and I. However, these are captured by a particulate filter fitted into the exhaust system. However, the particulates are captured in the filter which then needs to be maintained to prevent blockage which will result in lost performance and ultimately the replacement of the filter which can cost up to £2,000.
In order to ‘clean’ out the filter you need to drive the car at more than 50mph for more than 15 minutes every month (see the manufacturer’s handbook). This creates a chemical action that effectively burns off the soot but for some who only drive locally this can be a bit of a chore. There is also the driving style when driving a diesel car. Even the latest cars suffer from a little turbo lag,
This means when pulling away from lights or out of a junction, you put your foot down on the accelerator and it takes a second to get the power into the wheels. You get used to it but it feels a bit weird if you have never driven a diesel before. Oh and a personal tip, always put a plastic glove on when filling up a diesel, in fact I always put two on as the smell seems to immediately absorb into your hand and stay with you for a week, even worse if you transfer onto the steering wheel. Petrol isn’t anywhere near as bad.
Another factor is cost. Generally diesel cars are more expensive than petrol to buy but when it comes to leasing diesels are in such high demand that the resale value ends up making diesel’s cheaper to lease than petrol so a bit of an advantage there. So what has Euro 6 done to make diesel’s less attractive? Well, in order to achieve the lower NOx emissions cars now require an additive called AdBlue.
In most cases the AdBlue reservoir is sufficient to last between services but as some drivers have found, depending on driving style and types of journey the reservoir needs to be topped up between services. Whilst you can buy AdBlue from anywhere that sells oil such as Halfords and is relatively cheap if misused or not topped up when the indicator light comes on you could be into some costly repairs or at best the engine not starting. So bear in mind if you are about to buy or lease a new diesel AdBlue is now something else to take into account.
Finally there seems to be a tide of hate spreading across the country against diesels. Boris has started the ball rolling by saying that any pre-Euro 6 cars will have to pay an extra tenner to enter what is known as the Ultra Low Emission Zone in London. Some councils have already started to charge extra for parking permits if you drive a diesel. Islington Council in London is set to introduce a surcharge of £96 for anyone with a diesel car from April and they don’t seem to be differentiating between Euro 6 and pre-Euro 6. Totally unfair!
So there you have it, you can now make an educated decision between petrol and diesel. The only other thing I haven’t mentioned is Benefit In Kind tax if you run a car through a limited company. The chancellor had planned to eliminate the 3% loading on diesel cars but following the emissions issues with VW he took the ill informed decision to retain it. By Graham Hill