Should Londoners sell their cars before the 2023 ULEZ extension?

28 July 2023

From 29 August 2023 the London Ultra-Low Emissions Zone (ULEZ) will expand right out to the M25 but not include it. Here’s our latest advice.

The extension has provoked widely reported opposition. In early July, five Conservative councils: Bexley, Bromley, Harrow, Hillingdon and Surrey County Council spent two days at the High Court seeking a judicial review of London mayor Sadiq Khan’s decision to extend the ULEZ.

They argued that he exceeded his powers in extending an existing scheme rather than a creating a new one, that the consultation was flawed and that the scrappage scheme lacked detail. The mayor’s chief defence was that he has a statutory responsibility to take measures to improve London’s air quality. On 28 July, a judge ruled that the plan to extend the zone was lawful, so could go ahead.

Other London councils have also expressed concerns over the expansion, with many asking the mayor to delay or improve the scrappage scheme to support people during the cost-of-living crisis.

You can read our full guide to the London Ultra Low Emissions Zone (ULEZ), but in short it means that if your petrol vehicle does not meet Euro 4 emission standards (before 1 Jan 2006) or Euro 6 standards for diesel vehicles (pre-September 2015) you have to pay £12.50 a day to drive a non-compliant car within both the existing or the new zone and if you enter from outside.

Vans and taxis have their own rules: see our guide to the London Ultra Low Emission Zone (ULEZ) for vans.

Map of London ULEZ extension for 2023 — Map showing the ULEZ zones in 2019 (inner zone), 2021 (middle zone) and from August 2023 (outer zone)

The ULEZ currently covers the area inside the North Circular (A406) and South Circular (A205) roads. A separate Low Emission Zone (LEZ) for diesel lorries expands out to Greater London.

The ULEZ charge applies all day, every day, apart from Christmas Day. This includes residents of the ULEZ. However, you don’t need to pay the daily charge if you are parked inside the zone and don’t drive on that day.

If you own an older car within the expansion zone or are likely to have to drive into it with one, the first thing you should do is check whether your car is already compliant by using the Transport for London’s ‘Check Your Vehicle’ web page. Transport for London (TfL) maintains that 9 out of 10 cars seen driving in outer London on an average day meet the ULEZ emissions standards.

The scrappage scheme and exemptions

Londoners receiving certain low-income or disability benefits can apply to the £110 million scrappage scheme. Eligible applicants could receive a payment to scrap their vehicle (up to £2,000 for a regular car, £5,000 for a wheelchair-accessible vehicle), or choose a lower payment plus one or two TfL Annual Bus & Tram passes which TfL says are worth more than the payment alone.

A separate van and minibus scrappage scheme will also be available for sole traders, micro-businesses (10 or fewer employees) and charities. More details are promised by the end of July about a grace period for the latter categories to cover those who have ordered brand new, compliant vans or minibuses with a delivery due after 29 August, or booked a non-compliant light van or minibus to be retrofitted, where a booking slot wasn’t available before the ULEZ expands.

However, with the rising cost of living, Londoners who are not in the narrow band of people entitled to an exemption may simply give up having a car altogether because they can’t afford to change right now.

Our Expert Partner Motorway, the car-buying service, found in a survey earlier this year that 23% of Londoners say it is too expensive to use their vehicle for work due to the cost of ULEZ.

If you are an occasional car user you might consider joining a car club. As we explain here if you don’t mind sharing a car which other people use, it may be worthwhile giving up car ownership, or replacing a non-compliant second car with a car club subscription. You pay by the hour or the day and fuel, insurance and city charges are included.

Many clubs, such as Enterprise Car Club have a cost calculator to work out how much you could save in total compared to a monthly finance payment, fuel, and insurance. There are some incentives from TfL, for example, one years’ worth of free membership of Enterprise Car Club normally worth £60, along with £10 of free driving credit.

Buying or selling an older car in London?

If you are buying a used car within the zones in the next few weeks, look up its compliance yourself before you view it – don’t just take the seller’s claim that it’s ULEZ-compliant (this appears on many ads in the Autotrader for example).

The good news is that many carmakers adopted Euro 4 (petrol) before 2006. Looking at Auto Trader, we saw a £1,000 2002 Peugeot 206 CC and a £695 2004 Volkswagen Polo, one on sale within the new zone, one outside, which are both compliant.

If you are selling privately yourself, it’s likely you’ll already know whether or not it’s compliant. If you’re not keen on selling privately, you can consider using Motorway, which provides a platform to sell to dealers across the UK.

Alex Buttle, one of Motorway’s co-founders says: “In the lead up to the expansion, car values are changing, with the price of some compliant models going up due to demand. On the flip side, non-compliant cars could see a drop in value in the run up to, and once the expansion comes into effect. Car owners needing to sell should consider doing so sooner rather than later, to get their best price.”

According to Motorway’s data, the average sold price for a Volkswagen Polo under five years old has increased by 18% quarter-on-quarter and the average sold price for a Ford Focus under five years old has increased by 9% quarter-on-quarter.

Emissions zones in other UK cities

Elsewhere in the UK, some cities run emissions-based zone schemes under a variety of names, but none are on the same scale as the London ULEZ.

Bath, Birmingham, Bradford, Newcastle, Portsmouth, Sheffield and Tyneside (Newcastle and Gateshead) now have clean air zones but private cars are currently exempt. A pilot scheme for a zero emissions zone is running in a small part of Oxford city centre but has no date for expanding and launching.

Bristol started a small central clean air zone last November and private combustion-engine cars which don’t conform to the London ULEZ standards (Euro 4-upwards petrol vehicles, Euro 6 diesel vehicles, roughly end of 2015 onwards) have to pay £9 to enter.

The Greater Manchester clean air zone has been on pause for over a year and is still under review but could rival London. This could have a major impact on used var values says Alex Buttle of Motorway: “As it’s the UK’s second most populated city, if Greater Manchester were to introduce charges for non-compliant cars, we would expect this would drive further fluidity in the market, as many more people would need to sell their cars.”

Outside of England, Cardiff is still consulting. Belfast does not have a zone. Aberdeen will launch a low emission zone in 2024, Dundee will start enforcing an already-launched zone in 2024, as will Edinburgh. Glasgow launched its city centre LEZ in June 2023. Emission standards for LEZs in Scotland have been set in legislation at national level and for private petrol/private cars follow the Euro 4/Euro 6 split.

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What’s next for ULEZ?

If you’re thinking that you’re fine because your car is compliant with the new ULEZ rules, don’t get too comfortable. Now that the Mayor of London has created the means to monitor and tax every vehicle moving anywhere inside Greater London, he’s unlikely to stop at older cars.

After the 2023 ULEZ extension comes into force this month, the Mayor’s next step will almost certainly be to target Euro 5 petrol cars. Then all diesel cars. Then everybody else – including electric cars. And the current £12.50 charge will inevitably creep up to £15 a day, then towards £20.

Like any politician, Sadiq Khan knows that taxing motorists is easy and lucrative. However, at least most governments have the good taste to apply more tax to the most expensive cars and wealthiest owners. The Mayor of London, on the other hand, has chosen to tax the less well-off who can’t afford a new car – especially in the middle of a cost-of-living crisis – and who are now going to have to pay £12.50 every day to drive to work or take the kids to school.
Stuart Masson, editor