Driving Change: The Global Impact of the Used Vehicle Market

The report "Used Vehicles and the Environment: A Global Overview of Used Light-Duty Vehicles: Flow, Scale and Regulation" provides a detailed analysis of the export and regulation of used light-duty vehicles (LDVs) from 2015-2022. Highlighting key trends, regional distributions, and regulatory environments, the report emphasizes the significant impact of this trade on low-and-middle-income countries (LMICs).

The Booming Trade of Used Vehicles

The global trade of used light-duty vehicles (LDVs) has seen a massive surge, with over 23 million vehicles exported between 2015 and 2022. The leading exporters, Japan, the European Union (EU), the United States (USA), and the Republic of Korea (ROK), have driven this growth, primarily supplying to developing regions. A recent report by the United Nations Environment Programme (UNEP) sheds light on the dynamics of this trade, its environmental implications, and the regulatory measures shaping it.

Export Trends and Key Players

Japan has long held the top spot in used vehicle exports, accounting for 34.5% of the market from 2015-2022. However, the EU has recently overtaken Japan, becoming the largest exporter in 2021 and 2022. The USA and ROK follow, contributing 23.9% and 10.5% respectively. Despite a significant drop in exports during the COVID-19 pandemic, the market rebounded to pre-pandemic levels by 2022.

Africa emerges as the largest importer, receiving 33% of the exported used LDVs, followed by the Eastern Europe, Caucasus, and Central Asia (EECCA) region at 24%, Asia-Pacific at 16%, the Middle East at 15%, and Latin America and the Caribbean (LAC) at 12%.

Electric Vehicles on the Rise

The shift towards more sustainable transportation is evident in the growing trade of used battery-powered electric vehicles (BEVs). From 2017 to 2022, the EU, Japan, and ROK exported over 105,000 used BEVs, with the EECCA region receiving the largest share at 38%, followed by LAC (29%) and Asia-Pacific (24%). This trend underscores the potential for electric vehicle technology transfer to the Global South, promoting cleaner and more efficient transportation options.

The Regulatory Landscape

Regulations play a crucial role in ensuring the quality and safety of used vehicles. As of December 2023, 71 countries have adopted 'good' or 'very good' policies for importing used LDVs, a significant increase from 47 countries in 2021. The European Commission is leading efforts with a proposal for new End-of-Life Vehicles (ELVs) regulations. This directive aims to prevent the export of non-roadworthy vehicles and ensure compliance with importing countries' standards.

Challenges and Recommendations

Despite progress, challenges remain. Exporting countries need to ensure that no wrecks are exported and that all vehicles have valid roadworthiness certificates. Importing countries, on the other hand, should establish and enforce minimum safety and environmental standards. Enhanced data collection and research are also essential to understand better the impacts of used LDVs on the environment, economy, and road safety.

Towards a Sustainable Future

The UNEP report highlights the shared responsibility between exporting and importing countries to improve the quality of used vehicles. Collaborative efforts are needed to harmonize standards and promote the import of cleaner, safer, and more efficient vehicles. By focusing on regulation and quality assurance, the global community can mitigate the negative impacts of used LDVs and support sustainable development in the Global South.