The governments of the Baltic countries Latvia, Lithuania, and Estonia are designing a complex series of measures, aimed at improving the current ways the countries manage and optimize their national automotive fleets, according to local experts in the field of automotive management and senior officials of local governments.
Despite the fact that all the three countries joined the European Union almost 15 years ago, the current principles of management of their automotive fleets mostly follow Soviet-based practices.
In addition, the age of vehicles being higher than average has been another major obstacle, which has prevented rapid development of the fleet industry in each country.
Transportation currently accounts for about 30% in the overall structure of harmful emissions in the entire Baltics region. This is due to the lack of large-scale industrial capacities and insignificant use of traditional energy sources, (such as coal), despite having been considered as one of the most ecologically clean areas of the EU, according to recent statistics of the Estonian government. Analysts said the main reason is due to poor, outdated automotive fleets used in the Baltics region.
Fleet Market in Lithuania
The latest data published by the Lithuanian government shows the average age of cars is currently estimated at 16.7 years, which is significantly higher the average EU figures of 10.7 years.
According to Gintautas Schlederis, head of Transeksta Association, (a public association, which provides services of vehicle technical inspections in Lithuania) the main reason for this is because local citizens in the region usually pay insufficient attention to the issues of ecology and even technical condition of the car, unlike citizens from other EU states.
Experts of Transeksta have also said in the absence of strict state requirements, particularly regarding the environment, citizens often prefer to buy used cars, and technical maintenance usually ends up not being a big cost.
The same is also true for local businesses, including those specializing on freight activities. Analysts of Transeksta have also said most of these corporate fleets are usually comprised from old, used vehicles, which were mainly purchased in Finland and some Nordic states.
This was confirmed by Rokas Kniva, head of the Lithuanian Automotive Association, who said more than three-fourths of the entire automotive fleet in Lithuania is an average of 10 years old. As a rule, most of these vehicles just meet the requirements of Euro 3 class engine, which were valid for cars produced before 2005.
Schlederis said this situation is also complicated by the lack of a clear state policy in the field of auto fleet management in Lithuania.
Kniva also believes the main problem is related with the lack of a national transport strategy in the country and insufficient regulation of the national industry of automotive fleet by the government.
“The government has not yet formed a clear policy in the field of fleet management, both in terms of quality and age of used vehicles, which has a negative effect on the entire industry,” said Kniva.
Fleet Market in Estonia
The overall picture for Estonia isn’t much better than that of Lithuania’s, as the country’s automotive fleet also in the list of the oldest among other EU states.
According to the Estonian Road Department, a state agency which is responsible for the technical maintenance of roads in the country, the Estonian automotive fleet is currently comprised of 730,000 cars, of which approximately 600,000 are regularly used by local citizens. However, the technical conditions of a majority of these vehicles remains generally poor and a significant portion of them do not comply with the latest environmental regulations in the EU.
Arno Sillat, an executive director of the Estonian Union of Enterprises for Car Sales and Service, said one of the major reasons for the current situation in the market is large imports of low quality, used cars, including those, which have serious latent defects.
Sillat said the government should limit further imports of such cars to Estonia, otherwise the current condition of the local automotive fleet will continue to deteriorate.
At present most of car imports to Estonia come from Finland and Nordic states, as well as Russia.
For example, almost 70% of the Estonian trucks’ fleet is comprised from Scania and Volvo trucks, which is supplied from the Nordic region.
In the meantime, the Estonian government acknowledged the current situation in the market and is considering solutions.
According to an official spokesman of the department of transport development and investments of the Estonian Ministry of Economic Affairs and Communications, for this purpose, the government currently focuses on the development of a new state strategy for the national automotive fleet after 2021.
As part of these plans, the government plans to create conditions for a more active transition to electric or hybrid technologies, providing various benefits and incentives to those domestic citizens that will switch for the use of such cars.
In the case of EVs, Estonia already has a small network of charging stations, which are located in several provinces of the country. Also, according to state plans, this will be significantly expanded during the next several years.
In the long-term, Estonia plans to follow the path of France and the UK, and to impose at least a partial ban on the use of cars with diesel and petrol engines within the territory of the country.
Fleet Market in Latvia
In Latvia, the age of the local automotive fleet averages in the range of 15-20 years, according to Andris Kulbergs, a senior member of Latvian Association of Authorized Auto Traders, a public association, which unites leading auto dealers in Latvia.
According to Kulbergs, similar to other Baltics states, Latvia is faced with the ever growing imports of old cars from the EU in recent years.
“In recent years, Latvia has become a dump of old cars, which are brought down to the country from all over Europe,” said Kulbergs. “Contrary to the majority of other EU states, which continue to increase the share of eco-friendly cars in the overall structure of their automotive fleets, in the case of Latvia we accept almost all cars, which are prohibited for imports to other EU states. What will happen next? In a few years, the European Union may impose huge fines and penalties against Latvia for the ongoing use of cars with high emission levels.”
According to state statistics, at present the share of passenger cars of mini, small and compact classes in the overall structure of the Latvian automotive fleet is estimated at only 27%. The remaining account for vehicles with higher emission levels.
In comparison, the EU, share of small cars is currently equivalent by the average of 65%, and even 80-90% in certain EU states.
According to data of the European Manufacturers Association (ACEA), at present Latvia, Lithuania, and Estonia are among the EU leaders in terms of registrations of cars with the highest average CO2.