COMMISSION STAFF WORKING DOCUMENT Accompanying document to the
Date: 2010-10-27
Institutions: European Commission
Subjects: air quality, approximation of laws, motor vehicle, pollution control measures, technical regulations, tractor

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EUROPEAN COMMISSION 

Brussels, 27.10.2010 
SEC(2010) 1251 final 

COMMISSION STAFF WORKING DOCUMENT 

Accompanying document to the  

Proposal for a 

DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 
amending Directive 2000/25/EC as regards the implementation provisions for tractors placed on the 
market under a “flexible scheme” 

Impact Assessment 

{COM(2010) 607} 
{SEC(2010) 1252} 

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TABLE OF CONTENTS 

1. 

1.1. 

1.2. 

1.3. 

1.4. 

2. 

2.1. 

2.2. 

3. 

3.1. 

3.2. 

3.3. 

3.4. 

3.5. 

3.6. 

3.7. 

3.8. 

4. 

Introduction and policy context ................................................................................... 5 

Basis for the introduction of the flexibility scheme, relation between the machinery 
and the tractors directive .............................................................................................. 5 

Overview of the tractor sector...................................................................................... 7 

Emissions from tractors ............................................................................................... 9 

Competitiveness issues .............................................................................................. 10 

Procedural issues and positions from consultation of interested parties.................... 10 

Consultation and external expertise ........................................................................... 10 

Impact Assessment Board (IAB) recommendations .................................................. 12 

Problem definition...................................................................................................... 13 

Background ................................................................................................................ 13 

Developing New Engine Technology ........................................................................ 14 

Ability to Comply ...................................................................................................... 14 

Compliance costs ....................................................................................................... 15 

Regulatory issues ....................................................................................................... 16 

Influence of the economic crisis and other relevant factors....................................... 16 

How will the situation develop?................................................................................. 17 

Does the EU have the right to act?............................................................................. 18 

objectives ................................................................................................................... 18 

4.1. 

Consistency with other horizontal objectives of the European Union....................... 19 

4.1.1.  The European Economic Recovery Plan and EU2020 Strategy ................................ 19 

4.1.2.  Environmental EU Policies ........................................................................................ 19 

5. 

5.1. 

5.2. 

6. 

6.1. 

6.2. 

Policy Options............................................................................................................ 20 

Introduction................................................................................................................ 20 

Options ....................................................................................................................... 20 

Option Analysis – Preliminary Analysis.................................................................... 23 

Analysis of Option 1 – Baseline ................................................................................ 23 

Analysis of Option 2 - Provision of government backed loans for purchasing stocked 
engines manufactured under the so called sell-off period.......................................... 24 

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6.3. 

6.4. 

Analysis of Option 3 - Implementation of a scrapping scheme (on a national basis) 25 

Analysis of Option 4 – Implementation of alternative types of provisions under the 
existing flexibility scheme ......................................................................................... 25 

6.4.1.  Option 4.1 - Implementation of scaled percentages of flexibility for the different 

types of tractors, depending on the problems they encounter for the transition from 
Stage IIIA to Stage IIIB. ............................................................................................ 25 

6.4.2.  Option 4.2 - Increase of flexibility percentage to 35% and proportionate adjustment 

of the fixed numbers of engines. ................................................................................ 26 

6.4.3.  Option 4.3 - Increase of flexibility percentage to 50% and proportionate adjustment 

of the fixed numbers. ................................................................................................. 26 

6.4.4.  Option 4.4 - Increase of flexibility percentage to 80% and proportionate adjustment 

of the fixed numbers of engines. ................................................................................ 26 

6.4.5.  Option 4.5 - Conditional use of the flexibility scheme, with penalty mechanism. .... 26 

6.4.6.  Option 4.6 - Implementation of a trading system. ..................................................... 27 

6.4.7.  Option 4.7 – Introduction of ABT scheme. ............................................................... 28 

6.5. 

6.6. 

7. 

7.1. 

7.2. 

7.3. 

7.4. 

7.5. 

7.6. 

7.7. 

8. 

Comparison of the Options ........................................................................................ 28 

Conclusion on preliminary Analysis.......................................................................... 32 

Impacts of preferred option........................................................................................ 32 

Environmental impact ................................................................................................ 32 

Economic impact........................................................................................................ 36 

Impact on SMEs......................................................................................................... 36 

Social impacts ............................................................................................................ 37 

Competition impacts .................................................................................................. 37 

Administrative burden................................................................................................ 38 

Effect of the proposed measure compared to the base line........................................ 38 

Monitoring and evaluation ......................................................................................... 39 

ANNEX I: Glossary ................................................................................................................. 40 

ANNEX II: Reference Documents........................................................................................... 41 

ANNEX III: Summarized Stages table of Directive 2000/25/EC............................................ 42 

ANNEX IV: Flexibility scheme, fixed numbers and ABT ...................................................... 46 

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ANNEX V: Positions of stakeholders regarding the amendment of the provisions of the 
flexibility scheme for NNRM and tractors............................................................................... 50 

ANNEX VI: Fleet and annual sales of tractors ........................................................................ 53 

ANNEX VII: Emissions of NOx and PM ................................................................................ 54 

ANNEX VIII: Market of agricultural vehicles ........................................................................ 55 

1. Category T: Wheeled tractors .............................................................................................. 55 

2. Category C: Track – laying tractors ..................................................................................... 56 

ANNEX IX: the SME Test (ARCADIS report 30-03-2010) ................................................... 60 

ANNEX X: Comparison of the options ................................................................................... 61 

ANNEX XI: Calculation of environmental impact and maintenance costs............................. 65 

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1. 

INTRODUCTION AND POLICY CONTEXT 

The  tractors  emissions  Directive  2000/25/EC1  regulates  the  exhaust  emissions  (carbon 
monoxide  (CO),  hydrocarbons  (HC),  nitrogen  oxides  (NOx)  and  particulate  matter  (PM)) 
from  diesel  engines  installed  in  agricultural  and  forestry  tractors  (hereafter:  tractors).  The 
Directive  includes  a  series  of  emission  limit  stages  of  increasing  stringency  with 
corresponding  compliance  dates.  These  limits  are  based  upon  those  contained  in  Directive 
97/68/EC,  which  covers  emission  limits  for  non-road  mobile  machinery  (NRMM)  because 
engines used for these two applications are of a similar technical nature, and it is logical that 
their  emission  requirements  should  be  aligned  to  allow  interchangeability  between  engine 
designs used for NRRM and tractor applications. 

The  original  directive  on  tractors  emissions  was  introduced  in  2000  and  its  decisions  on 
deadlines and criteria were based on data available at that time. The emissions limits set in the 
Directive were particularly ambitious for the later stages (for PM, a reduction by 88 to 94 % 
was required) therefore in order to ease the burden for manufacturers, an amendment to the 
Directive was introduced in 2005 (2005/13/EC). This introduced a flexibility scheme, based 
upon a similar scheme already introduced for NRMM, to facilitate the transition between the 
different  emission  stages.  The  flexibility  scheme  allows  the  manufacturers  to  place  on  the 
market, during the period between two successive stages of exhaust emissions limit values, a 
limited number of tractors fitted with compression ignition engines that comply only with the 
exhaust emission limits of the previous stage. A manufacturer has the option either to place on 
the market for each engine power category a limited number of machines not exceeding 20% 
of  the  manufacturer's  annual  sales  (calculated  as  the  average  sales  in  the  EU  of  the  latest  5 
years) or a fixed maximum number of units as stipulated in the Directive. This second option 
was intended to be used by smaller enterprises producing lower volumes of engines. 

The  present  level  of  emission  limits  is  aligned with  those  of  the  USA,  the  major  difference 
being the system and level of implementing measures (flexibility). 

1.1. 

Basis  for  the  introduction  of  the  flexibility  scheme,  relation  between  the 
machinery and the tractors directive 

The tractors emissions directive2 was set up fully in line with the non-road mobile machinery 
(NRMM)  Directive  and  implemented  the  same  requirements  specifically  for  tractors  under 
Framework  Directive  2003/37/EC;  separating  the  requirements  into  two  directives  allowed 
the creation of a stand-alone tractors Directive  which could  be incorporated into  the whole-
vehicle  type-approval  system  for  tractors.  Since  the  provisions  for  tractors  are  aligned  with 
those  for  machinery,  this  impact  assessment  draws  on  the  IA  for  flexibility  for  non-road 
mobile machinery. Nevertheless it was considered necessary to treat the proposals separately 
because of differences in timing (work on NRMM being more advanced). 

For the various types of non-road mobile machinery (NRMM), Directive 97/68/EC stipulates 
the maximum permitted engines exhaust emissions as a function of the power of the installed 

1 
2 

OJ L173, 12.7.2000, p.1 
OJ L 173, 12.7.2000, p. 1, as amended by 2005/13/EC in OJ L 55, 1.3.2005, p.35 and 2006/96/EC in OJ 
L 363, 20.12.2006, p. 81. 

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engine.  Moreover,  the  Directive  includes  a  series  of  emission  limit  stages  of  increasing 
stringency with corresponding compliance dates. NRMM manufacturers must ensure that new 
engines used in their machines comply with these limits when placing them on the market.  

Directive 2004/26/EC3 amended the original NRMM Directive  and  introduced  the  currently 
applicable  stage  of  emission  limits  for  the  majority  of  diesel  engines  (referred  to  as  Stage 
IIIA). These limits will be replaced by the more stringent Stage IIIB limits entering into force 
progressively,  depending  on  the  power  category,  as  of  1st  January  2011  with  regard  to  the 
placing on the market. From 1st January 2010 the type-approval period for these engines has 
started. As the Stage IIIB limits are stricter for PM and NOx, current engines will need to be 
modified  and  re-designed  in  order  to  respect  the  new  limits.  This  redesign  affects 
manufacturers who have to adapt the design of their machines to accommodate the modified 
engines. This is a time and resources consuming procedure; the efforts needed depend heavily 
on the required changes to the engines and to the body of the machine in which the engine is 
to be installed.  

The  reductions  in  PM  and  NOx  emissions  resulting  from  stricter  emission  limits  are 
significant, as can be seen in Annex III, in the last table. For PM, a reduction by 88 to 94 % 
is required for the next emission limit stage. 

Directive  2004/26/EC  introduced  a  so-called  "flexibility scheme"4  to  facilitate  the  transition 
between  the  different  emission  stages.  The  flexibility  scheme  allows  the  manufacturers  to 
place  on  the  market,  during  the  period  between  two  successive  stages  of  exhaust  emissions 
limit values, a limited number of non-road mobile machinery fitted with compression ignition 
engines (with power from 19kW to 560 kW) that still comply with the exhaust emission limits 
of the previous stage. A manufacturer has the option either to place on the market (1) for each 
engine  power  category  a  limited  number  of  machines  not  exceeding  20%  of  the 
manufacturer's  annual  sales  of  machinery  (calculated  as  the  average  sales  in  the  EU  of  the 
latest 5 years) or (2) a fixed maximum number of machines as stipulated in the Directive. This 
second  option  was  intended  to  be  used  by  smaller  enterprises  producing  lower  volumes  of 
engines. 

The flexibility scheme was designed5 to: 

•  permit smooth integration of regulations applicable to the NRMM machinery; the majority 
of manufacturers do not produce their own engines, but have to purchase these from engine 
manufacturers.  Once  the  engine  manufacturer  is  satisfied  that  engine  and  after-treatment 
development6 is satisfactory and ready for production, then the manufacturer can follow-up 
with  its  integration  and  optimisation  in  the  vehicle  and  arrange  for  type-approval.  This 
situation  is  unique  compared  with  other  (namely  road)  vehicle  manufacturers,  who  can 
develop and produce both vehicle and engine at the same time. 

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6 

OJ L 225, 25.6.2004, p.3 
Additional clarifications on provisions of the flexibility scheme can be found in Annex IV 
As stipulated in the COM (2002) 765 final and COM (2000) 840, amending proposals  
Additional  equipment  installed  with  the  engine,  that  chemically  or  physically  reduces  the  exhaust 
emissions  emitted  from  the  engine  before  releasing  them  to  the  atmosphere  e.g.  Diesel  Particulate 
Filters, NOx adsorber Catalyst or Selective Catalyst Reduction systems 

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•  provide  the  necessary  environment  for  the  manufacturers  to  develop  and  adapt,  initially, 
machinery  with  bigger  volume  sales  and  fewer  problems  and  then  utilise  the  experience 
gained to adapt the rest of the machinery, produced at smaller volumes for niche markets. 
This experience makes the adaptation of the rest of the machinery less costly. 

•  avoid  excessive  impacts  during  the  transition  to  the  next  Stage  on  low  volume  products 

since development in these series requires relatively high fixed costs. 

The tractors emissions directive 2000/25/EC implemented the same requirements specifically 
for  tractors  as  the  requirements  for  non-road  mobile  machinery,  including  the  Stages  IIIA, 
IIIB  and  IV,  the  timeframe  and  the  flexibility  scheme.  Both  with  the  help  of  an  external 
consultant  who  had  extensive  contacts  with  industry  (organisations  as  well  as  individual 
companies, as listed in the study report) and through direct contacts the Commission services 
have obtained the best information available to show the need for the present action. 

For  the  specific  categories  of  ‘special  tractors’  (T2,  C2  and  T4.1,  designed  for  use  in 
vineyards  and  orchards,  also  known  as  'narrow-track  tractors')  the  proposal  for  enlarged 
flexibility  is  not  sufficient  to  address  the  problems  –  of  a  purely  technical  nature  - 
encountered  with  the  upcoming  introduction  of  Stages  IIIB  and  IV  emission  limits.  The 
Commission  is  therefore  considering  a  separate  amending  proposal  to  the  directive,  with  a 
specific  impact  assessment.  For  the  same  reason  as  described  above,  this  project  should  be 
treated separately from the current one and the one for machinery. 

1.2. 

Overview of the tractor sector 

Manufacturers  cannot  easily  be  categorised;  many  produce  tractors  and/or  other  agricultural 
(and  forestry)  machinery  and/or  other  non-road  mobile  machinery,  like  construction 
equipment. Some produce their own engines, but most outsource them.This makes it difficult 
to aggregate specific data on production, economic and financial performance and resources. 
This  is  aggravated  by  the  fact  that  industry  and  EU  legislation  do  not  use  the  same 
categorisation. Also, registration (for use on the road) is different among Member States, with 
some where tractors are not subject to registration at all. 

Global overview of some typical products: 

- agricultural tractors: ‘normal’ wheeled tractors, crawler tractors, fast tractors, narrow-track 
tractors (for use in vineyards and orchards), for mountainous areas (low centre of gravity); see 
Annex VIII for detailed definitions; 

-  self-propelled  agricultural  machinery  (in  EU  definitions  they  are  part  of  NRMM): 
planting,  spraying,  irrigating  machinery  etc.;  smaller  agricultural  machinery  like  machinery 
where the user is following on foot; harvesters for cotton, wheat, corn etc, 

-  other  (self-propelled)  NRMM,  some  examples: 
landfill  compactors,  pipe-layers, 
construction machinery (wheel loaders, bulldozers, off-highway trucks, hydraulic excavators 
etc.), forestry machinery (tree cutters, tree loaders etc.), road maintenance machinery, mobile 
cranes,  fork-lift  trucks,  generator  sets,  pumps,  inland  waterways  vessels,  railcars  and 
locomotives. 

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The NRMM Directive 97/68/EC covers emissions from the machines in the 2nd and 3rd indent; 
the tractors Directive 2000/25/EC covers only those in the first indent. 

Tractors  are  divided  into  two  broad  categories:  "T"  comprising  wheeled  tractors  and  "C" 
comprising track laying tractors. These are further divided into sub categories depending on 
the  vehicle  characteristics  (for  details  see:  Annex  VIII).  Categories  T2/C2  and  T4.1/C4.1 
representing narrow tractors and high clearance tractors, i.e. machines specifically developed 
for fruit and vine cultivations and adapted to extremely restricted spaces (see comment under 
1.1). 

Tractor  manufacturers  are  part  of  the  agricultural  machinery  industry,  which  in  Europe 
consists of around 1 500 manufacturers producing various types of (self propelled) harvesters, 
ploughs,  cultivators,  tillers,  seeders,  spreaders  etc.  In  2008  the  total  turnover  for  the 
agricultural  machinery  reached  around  €  30  billion7;  for  tractors  CEMA  estimated  the 
turnover for 2008 at € 10 billion. In the 1st quarter of 20098, hit by the financial crisis, the EU 
tractors  market  started  to  drop  sharply.  Following  the  decrease  in  downstream  demand,  the 
sales  of  tractors  decreased  by  20%  in  units.  Consequently,  according  to  the  information 
provided by CEMA, the turnover in 2009 decreased by 20-25% compared to 2008. For 2010, 
tractor manufacturers are expecting a further 5 to 10% decrease9. Figures for the 1st quarter of 
2010 for EU15 show a decrease of 22% compared to 200910. 

Directly  linked  jobs  reach  24  000  for  tractors  manufacturing,  with  another  10  000  indirect 
jobs (suppliers of parts and components, dealers / distributors etc). 

In  Europe  there  are  six  major  groups  that  actively  manufacture  tractors  and  some  smaller 
manufacturers,  with  a  total  of  more  than  40  brand  names.  Among  those,  some  15  can  be 
considered as SMEs. None of the engine manufacturers qualify as SME. On the other hand 
probably (almost) all end-users are SMEs: both farmers and contract workers. 

Additional information on the market situation of tractors is included in Annex VIII. 

Tractors  use  compression  ignition  engines  (CI,  diesel)  with  a  power  rating  between  19  and 
560  kW.  Only  4  out  of  40  tractor  manufacturers  are  integrated  engine  and  equipment 
manufacturers.  The  other manufacturers rely on the supply of engines from  10  large engine 
manufacturers  operating  on  the  EU  market.  The  latter  sell  their  products  to  tractor 
manufacturers. The contracts between the engine manufacturers and the tractor manufacturers 
usually last for at least 3 years, as it is very difficult to redesign equipment for a new engine.11 

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Source: CEMA 
Reference: CEMA letter and attached ''Background material for the Request to Enlarge Flexibility from 
20% to 50% for Stage IIIB'', 14-07-2009, addressed to Commission VP G. Verheugen. Additional 
information on market share can be found in the study 'Competitive analysis of the EU Mechanical 
Engineering', p. 4, available at the link: 
http://ec.europa.eu/enterprise/mechan_equipment/companalysis-eu-mechengin.pdf 
Source: email from CEMA to ENTR-F.1 dated 18.02.2010. 
Source: CEMA, June 2010. 
Source: ARCADIS study 

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In 2005, the latest available information indicated that there were 2 500 420 tractors in use12 
(for a detailed breakdown data per engine type, please refer to Annex VI).  

When  engines  are  sold  to  a  tractor  manufacturer,  the  transaction  takes  place  without 
intermediary and the prices are kept secret – this business practice is an important constraint 
on  the  availability  of  data.  An  additional  difficulty  in  obtaining  tractor-specific  information 
results  from  the  fact  that  such  sources  such  as  EUROSTAT  treat  tractors  as  part  of  the 
agricultural machinery. Nonetheless, due to similarities between NRMM and tractors as to the 
engines used, the present report will build on the findings for NRMM sector. 

1.3. 

Emissions from tractors 

Data on emissions from tractors cannot be obtained from emissions inventories like those on 
the  web  site  of  the  European  Environment  Agency13  as  tractors  are  not  defined  separately 
therein. 

The key air pollutants from the tractors sector contributing to overall air pollution are PM and 
NOx emissions14. According to the RAINS model15 the estimated PM1016 emissions from the 
entire  NRMM  sector  for  EU27  are  7%  compared  to  13%  for  road  transport.  In  2005,  the 
contribution of tractors to all NRMM PM emissions was 43% or 57 kt per year for EU15 and 
47%  or  11  kt  per  year  for  EU  12.17  In  terms  of  NOx  emissions,  the  NRMM  sector  is 
responsible  for  16%  of  all  NOx  emissions  in  the  EU27  while  the  road  sector  contributes  to 
42% of all NOx emissions. In 2005, the contribution of tractors to all NRMM NOx emissions 
was  36%  or  539  kt  per  year  for  EU15  and  43%  or  120  kt  per  year  for  EU1218.  This 
contribution  from  tractors  to  the  overall  air  pollution  in  the  EU  provides  the  rationale  for 
increasing the efforts to reduce the emissions in the coming years. Care will be taken not to 
endanger  the  overall  objective  of  the  tractors  emissions  Directive  to  progressively  reduce 
emissions. 

Although  the  Directive  covers  exhaust  emissions  from  internal  combustion  engines,  it  does 
not address CO2. CO2 is not regulated under Directive 2003/37/EC. As a result no inventory 
or data is available on CO2 emissions of engines in the various types of tractors. As tractors 
applications and type approval procedures are different from those of other sectors like heavy 
and  light  duty  vehicles  or  cars,  the  methodology,  limits  and  implementation  dates  for  CO2 
emissions  still  need  to  be  identified.  According  to  industry  sources  and  based  on  the 
accumulated  knowledge  and  practices  of  other  sectors  the  development  of  necessary 
legislation and monitoring systems still require a transitional and testing period of about three 
to four years. 

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17 
18 

Source: CECE-CEMA-EUROMOT, 2006, Arcadis study, p. 295 
http://dataservice.eea.europa.eu/PivotApp/pivot.aspx?pivotid=468  
Definitions of the gaseous and particulate pollutants are the same as in Directive 97/68/EC Annex I, as 
amended, 
include: 
and 
 '2.2. gaseous pollutants shall mean carbon monoxide, hydrocarbons (assuming a ratio of C1: H1.85 and 
oxides of nitrogen, the last named being expressed in nitrogen dioxide (NO2 equivalent; 2.3. particulate 
pollutants  shall  mean  any  material  collected  on  a  specified  filter  medium  after  diluting  C.I.  engine 
exhaust gas with clean filtered air so that the temperature does not exceed 325 K (52 oC)'.  
Regional Air Pollution Information and Simulation model and database.  
Particulate matter below 10 µm 
JRC Technical Review, p. 24-25 
JRC Technical Review, p. 26-27 

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1.4. 

Competitiveness issues 

World-wide, only the EU and the USA and to  a lesser degree Japan have similar ambitions 
with  regard  to  engine  emission  legislation  for  NRMM  and  tractors.  In  other  important 
geographical areas like China, India, Russia or Latin-America these requirements do not exist, 
or are lagging stages behind. The main geographical market is the transatlantic market hosting 
the  key  manufacturers  of  engines  and  tractors,  but  also  the  main  customers.  This  is  why 
considerable efforts have been made to fully align emission limits and implementation dates 
of the key stages on both sides of the Atlantic. Testing procedures are currently in the process 
of  being  harmonised  at  global  level  and  UNECE19  adopted  a  Global  Technical  Regulation 
(GTR)  for  this  purpose  in  November  2009.  Only  the  administrative  approval  procedures 
remain different between the EU and the other countries that accept this GTR. 

Flexibility  measures  in  this  area  have  also  been  adopted  in  the  USA.  In  addition  to  the 
existing  flexibility  (for  tractor  manufacturers),  the  USA  system  introduced  an  additional 
'flexibility', the so-called ABT-system20 (for engine manufacturers), one of the main aspects 
of  which  is  that  emission  limits  must  not  be  met  by  each  individual  product  line,  but  as  an 
average over the manufacturer’s production sold over the year, so that a “dirty” product needs 
to  be  compensated  by  selling  a  “cleaner”  one.  In  addition  the  US  scheme  foresees  a  cap,  a 
higher emission limit that has to be met by each individual product. With all these measures at 
the disposal of the US industry, it is noteworthy that the present situation in the USA allows 
more  than  the  EU  flexibility  (up  to  80%  and  more21).  An  amendment  allowing  more 
flexibility  for  tractors  on  the  European  market  would  reduce  the  competitive  difference 
compared to the US market. 

2. 

PROCEDURAL ISSUES AND POSITIONS FROM CONSULTATION OF INTERESTED PARTIES 

2.1. 

Consultation and external expertise 

This IA Report builds on the report prepared for a flexibility proposal for NRMM prepared in 
2009.  The  current  analysis  takes  into  account  elements  of  the  ongoing  process  to  study  a 
revision of Directive 97/68/EC, including: 

•  a Technical Review of Directive 97/68/EC22 by the Joint Research Centre (JRC) 
which includes, inter alia, an evaluation of the need to amend the provisions of the 
flexibility scheme; 

•  an Impact Assessment study carried out by ARCADIS23 to assess the impacts of 

the policy options as laid down in the Technical Review by JRC.  

19 
20 
21 
22 

23 

See reference in Annex I 
Averaging, Banking and Trading system - see Annex IV – 2. 
See JRC page 97. 
The final report of the Technical Review is available on the NRMM web page at the Europa website : 
http://ec.europa.eu/enterprise/mechan_equipment/emissions/projstudies.htm  
The final report of the IA study by ARCADIS N.V. is available on the Europa website: 
http://ec.europa.eu/enterprise/newsroom/cf/newsbytheme.cfm?displayType=library&tpa_id=163&lang
=en 

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•  a complementary study to further assess, inter alia, the impacts of the options of 
the Technical Review of JRC, including the amendment of the flexibility scheme's 
percentage, to SMEs. The present report builds on the findings of this study which 
have been made available to the public and stakeholders through the NRMM web 
page24.  

For  a  possible  revision  of  the  flexibility  scheme  as  a  response  to  the  current  difficult 
economic  situation  of  the  engine  manufacturers  and  the  tractor  manufacturers,  the 
Commission’s  services  carried  out  between  May  and  June  2009  an  in  depth  consultation  of 
Member States’ authorities and stakeholders (industry, environmental organisations, workers 
associations)25.  Meetings  were  organised  with  the  following  main  industry  federations:  the 
Committees  for  European  Construction  Equipment  (CECE)  and  European  Agricultural 
Tractors  (CEMA).  In  a  letter  of  16  June  2009  Member  State  authorities  and  Non 
Governmental  Organisations  (NGOs),  the  European  Environmental  Bureau26  and  the 
European  Federation  for  Transport  &  Environment27  were  informed  about  the  proposal  to 
revise  the  flexibility  scheme  and  invited  to  submit  written  contributions.  The  letter  was 
uploaded  on  a  dedicated  web-based  consultation  tool  so  as  to  inform  stakeholders  more 
widely. On 22 June 2009 a presentation on the current and future initiatives on revising the 
NRMM  Directive  was  made  by  DG  Enterprise  at  the  'Clean  Air  seminar'  organised  by  the 
European Environmental Bureau at which most  Environmental  NGOs  were  represented.  On 
17 July 2009 the proposal to amend the flexibility scheme was discussed at a meeting of the 
Expert  Group  on  Emissions  from  NRMM  (GEME).  During  those  consultations  much  work 
was directed to the NRMM Directive, but all along it included work on flexibility for tractors 
(and on narrow-track tractors). The forum (GEME) was used to consult relevant stakeholders 
on  the  tractors  flexibility.  Italy  expressed  its  support  for  extending  the  flexibility  to  the 
tractors' field, also repeatedly in messages to the Commission services. 

The issue of wider flexibility for tractors was also discussed with all relevant stakeholders in 
the  Commission's  Working  Group  on  Agricultural  Tractors  (WGAT)  on  22  June  and  18 
December 2009 and in the Commission's Working Group on Motor Vehicles on 26 January 
2010. Apart from  general support for wider  flexibility expressed by some MS  and CEMA / 
EUROMOT no further comments were made in those meetings. 

CEMA and ORGALIME28 addressed the Commission in writing29 and at a meeting with the 
then Commissioner for Enterprise and Industry, Günter Verheugen with the request to support 
a wider flexibility allowance (50% instead of 20%), explaining why the tractor industry would 
need such mitigating measure. 

24 

25 

26 
27 
28 

29 

More relevant information can be found on the link: 
http://ec.europa.eu/enterprise/newsroom/cf/newsbytheme.cfm?displayType=library&tpa_id=163&lang
=en 
Summarised information on the contributions of the public consultation on this proposal may be found 
in Annex V 
More relevant information can be found on the link: http://www.eeb.org/  
More relevant information can be found on the link: http://www.transportenvironment.org/ 
Organisme  de  Liaison  des  Industries  Métalliques  Européennes  is  the  European  Engineering 
Industries Association, speaking for 33 trade federations representing some 130 000 companies in the 
mechanical,  electrical,  electronic  and  metalworking  &  metal  articles  industries  of  22  European 
countries.  
See footnote 9. 

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The input from stakeholders has been taken into account, assessing different options to amend 
the provisions of the flexibility scheme. It has also been considered by the external contractor 
(ARCADIS)  while  assessing  environmental,  social  and  economic  impacts  on  large 
manufacturers, SMEs, workers, consumers and users. 

A summary of the views of various stakeholders can be found in Annex V.  

In  support  of  this  IA,  an  Impact  Assessment  Steering  Group  (IASG)  was  created  with 
invitations for participation sent to DG Joint Research Centre, DG Research, the Secretariat-
General, DG Environment, DG Mobility and Transport, DG Employment, DG Trade and DG 
Agriculture. The IASG met twice on 15 March 2010, and 13 April 2010, with participation by 
DG ENTR, ENV (15-3), MOVE (13-4) and SG (13-4); written contributions came from ENV 
and ECFIN. The suggestions of the IASG group have been incorporated in the IA. 

2.2. 

Impact Assessment Board (IAB) recommendations 

The  Impact  Assessment  was  discussed  at  the  IAB  meeting  of  2  June  2010.  Following  a 
negative  opinion  of  the  Board  the  report  has  been  considerably  changed,  using  the  best 
information  available  in  order  to  address  the  main  concerns  expressed  in  the  opinion.  The 
main changes are as follows: 

The baseline scenario has been reworded in order to distinguish the effects of preparation for 
the new requirements and the impact of the crisis (paragraph 6.1). Modifications have been 
made  throughout  the  text  to  emphasise  how  the  different  players  have  been  affected  by  the 
current situation. 

As suggested, additional options have been added (paragraphs 5.2, 6.4 and later); in particular 
we have explained what the effect of 80% flexibility would be and why the introduction of the 
USA-like ABT system is not feasible. 

Future compliance with Stage IV has been addressed in 5.1, 6.4 and 7.1.1. 

We have added the latest information on the readiness to comply of the different players (in 
paragraph 3.3). 

Text has been added (i.a. in paragraph 5.1) to explain and discuss the choice of the different 
options presented. 

The report explains (i.a. in paragraph 3.3) why it is not possible to give data on compliance 
costs for the industry; it provides the available information on competition impacts. 

In chapter 2 and especially in Annex V all the information about stakeholders' views has been 
clearly established. The additional comments sent separately have been taken into account. 

Paragraph 6.1  and others have  been  amended in order to support the need for EU action. It 
should  be  noted  however  that  specific  evidence  could  not  be  made  available  to  the 
Commission because of the sensitive nature of this information. 

Paragraph  7.5  has  been  revised  in  order  to  better  show  possible  impacts  of  the  preferred 
option on the competition. 

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On  the  basis  of  the  opinion  of  the  Board  after  resubmission  of  the  report  the  following 
paragraphs have been amended in order to address IAB recommendations:  

In paragraph 2.1 and Annex V we have clarified the stakeholder consultation. 

In  paragraph  3.3  and  later  the  position  (of  continuous  support  for  more  flexibility)  of  the 
manufacturer  who  informed  the  Commission  services  that  he  will  be  ready  by  the  present 
deadlines has been inserted. 

In paragraph 5.2 a new intermediate option 4.2 proposing 35% flexibility (halfway between 
20 and 50%) is introduced which is discussed in 6.4.2 and further30. 

In paragraph 5.2 and later the option (new number 4.4) of 80% is further discussed. 

In paragraphs 7 and 7.7 the text relating to the present 20% flexibility has been improved. 

The last lines of paragraph 7.1 have been modified to state the Commission's intention not to 
extend the flexibility for the future Stage IV and to inform stakeholders of this position. 

As a consequence of the above, the text of annex VIII was completed for 35 and 80% and the 
whole text was moved to annex IV (old annexes IX to XII being renumbered to VIII to XI). 
Also annex X (new) has been completed. 

3. 

PROBLEM DEFINITION  

3.1. 

Background 

The  technological  challenge  for  tractor  manufacturers  is  that  the  next  generation  of  engines 
must achieve emission reductions in PM and NOx comparable to those required and deployed 
in  on-road  engines  and  vehicles  (trucks,  buses  etc.).  Although  technical  solutions  to  meet 
these targets are becoming available, the physical implementation of these solutions across a 
full  range  of  products  is  particularly  challenging.  This  is  due,  not  only  to  the  technical 
modifications  required  for  the  engines,  but  also  the  additional  complexities  involved  in 
designing the installation of the engine and ancillary equipment to the vehicle itself. In cases 
where  a  manufacturer  produces  a  large  range  of  specialist  equipment,  often  produced  in 
relatively low volumes, this can take up a considerable amount of design resources. 

Despite  the  introduction  of  the  flexibility  scheme,  many  manufacturers  were  finding  the 
timetable  of  the  Directive  impossible  to  comply  with.  This  is  largely  due  to  the  economic 
crisis which caused the tractor market in Europe to decline by 20-25 % in units between 2008 
and  2009.  Steep  falls  in  sales  caused  a  large  decrease  in  income  and  available  capital  to 
finance  the  necessary  technology  research  and  development  for  tractors  with  suitably 
compliant  engines  in  all  power  categories  and  applications  within  the  time  limits  in  the 
Directive. Consequently, there is a danger that some products in certain sectors of the market 
will become unavailable, leading to end users (farmers and contract-workers) retaining older, 
more  polluting,  tractors  or  replacing  them  only  with  second  hand  machines  not  compliant 

30 

Introduction of the new option 4.2 (35% flexibility) caused renumbering of many paragraphs. 

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with even the current IIIA emissions standards: neither of these solutions can be considered as 
environmentally beneficial. 

At around the time that the engine development would have come to its final stages, in early 
2009, the tractor industry was hit by the crisis. This may have caused delays for the engine 
development, but most of the problem rests with the tractor industry. 

The  purpose  of  the  impact  assessment  is  to  examine  possible  solutions  which  will  seek  to 
maintain,  as  far  as  possible,  the  environmental  benefits  envisaged  in  the  original  Directive, 
whilst  taking  into  account  the  changed  circumstances  with  regard  to  the  current  economic 
situation, and the desirability of maintaining the competitiveness of the industry. 

3.2. 

Developing New Engine Technology  

Engines compliant with Stage IIIB emission limits are going to be progressively placed on the 
market  as  of  2011  (see  Annex  III  for  the  details  of  the  timing  of  stages  across  engine 
categories).  

Substantial  changes  to  the  design  of  engines  are  necessary  to  meet  the  stringent  emission 
limits of Stage IIIB. Engines must be fitted with electronic control systems that deliver fuel at 
high pressures at the right time and in the right quantity for a cleaner burning process in the 
combustion  chamber.  In  addition  new,  sophisticated  after-treatment  systems  and  increased 
cooling capacity are necessary. These engine modifications have implications on for instance 
the mass and the size of the engines and on the location of its components, like connectors. 
This  means  that  also  the  configuration  of  the  tractor  body  (the  chassis  parts)  in  which  the 
engines are installed need to be redesigned in order to accommodate a new engine. For tractor 
manufacturers  this  implies  that  they  are  not  able  to  develop  and  design  the  tractor  until  the 
engine is ready, i.e. until the dimensions and mass of the engines are known.  

3.3. 

Ability to Comply 

Since  technical  solutions  for  Stage  IIIB  engines  are  in  general  not  yet  finalised,  tractor 
manufacturers are not in a position to fully redesign the body of the tractor where the engine 
is  to  be  installed.  The  research  on  technological  solutions,  followed  by  the  redesign  of  the 
engine, testing its performance both in terms of the emissions requirements and aspects like 
maintenance and durability can easily take 5 to 10 years. The original schedule allowed five 
years (2005 – 2010) for this process. This timetable was probably feasible in order to allow 
the  manufacturer  to  develop  technical  solutions,  but  the  implementation  of  these  solutions 
throughout  a  complete  range  of  engines  may  provide  a  greater  challenge,  depending  on  the 
basic  configuration  of  the  engine.  In  addition,  for  tractors  it  is  important  to  note  that  the 
complexity of the redesign varies depending on different tractor types. 

For  some  of  them,  the  Stage  IIIB  emissions  requirements  will  not  pose  very  significant 
problems for tractor manufacturers. For other types, a Stage IIIB compliant engine is far from 
being finalised and thus the tractor manufacturers have not been in a position to redesign their 
tractors accordingly. 

Tractor  manufacturers,  producing  tractors  with  engines  of  different  power  categories,  are  at 
various degrees of readiness depending very much on the range of products they manufacture. 
It is not possible to give a detailed overview of the state of preparation of each company/sub-

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sector as such information at that level of detail is not available. Despite many efforts made to 
obtain data on the level of preparedness of various actors for the next stage, the industry was 
reluctant to disclose such sensitive information for reasons linked to commercial interests.  

Based  on  information  received  from  the  tractor  manufacturers,  the  time  required  for  the 
adaptation of tractor bodies ranges between 12 and 18 months in order to accommodate the 
new  IIIB  engine  and  the  accompanying  after-treatment  system.  The  exact  duration  of  the 
adaptation period depends on  the number  of  tractors produced  with  various engines and the 
types of tractor in each engine power category.  

Apart from the redesign of the body, the adaptation of the tractor production line (additional 
space,  raw  material  handling  and  storage,  costs  etc)  must  also  be  finalised  in  the  same 
adaptation  period.  At  the  end  of  this  period  there  could  be  two  production  lines,  one  for  a 
Stage IIIA compliant tractor and one for Stage IIIB (see also point 2.1 on non-EU markets). 
Operating two production lines means that the manufacturer will need more operating staff, 
space, equipment and support, thus additional costs. 

Technical  solutions  for  tractor  manufacturers  still  need  to  be  found  and  consequently 
increased R&D efforts are necessary.  

Engine manufacturers: in June 2010 the Commission learned that the first engines for tractors 
have now been approved for Stage IIIB. 

Integrated manufacturers: There are four integrated manufacturers (who produce at least for a 
part their own engines and who also produce the tractors). According to anecdotal evidence, 
one  integrated  manufacturer  hopes  to  have  tractors  ready  by  the  required  deadlines.  Others 
confirm not to be ready with engine approval nor with tractors. CEMA, with support of the 
manufacturer  who  might  be  ready  by  the  imposed  deadlines,  maintains  that  the  sector  still 
needs the requested action. 

Therefore, with the best information available today and while engines may be ready by 2011 
and after-treatment systems are ready today for most purposes, most tractors will not be ready 
to be fitted with such engines by the deadlines specified in the currently applicable legislation. 

3.4. 

Compliance costs 

The  compliance  costs  for  tractor  manufacturers  to  cope  with  the  new  emission  limits  are 
significant.  These  include  costs  for  research  and  development,  redesign  of  equipment,  after 
treatment devices, documentation and labelling, etc. The external contractor has put a lot of 
effort  in  obtaining  data  as  listed  in  his  report;  for  the  present  project  this  did  not  bring  any 
useful  result.  The  same  applies  to  additional  efforts  by  DG  Enterprise  although  one 
manufacturer estimated to have spent € 1,5 billion on R&D for Stage IIIB. 

Existing  Stage  IIIA  production  lines  may  continue  to  be  used  –  depending  on  demand  for 
tractors  with  IIIA  engines  from  third  countries  that  do  not  have  the  same  exhaust  emission 
limits like the EU or the USA. In this case new production lines for tractors with IIIB engines 
must  be  set  up  with  additional  cost  of  equipment  and  personnel  (hiring,  training  etc).  For 
other costs than R&D no data have been made available. 

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3.5. 

Regulatory issues 

The  original  directive  on  tractors  emissions  was  introduced  in  2000  and  its  decisions  on 
deadlines and criteria were based on data available at that time. 

The strict timetable of transition from Stage IIIA to Stage IIIB with a duration of only 3 years 
compared to the 5 years of transition from Stage II to Stage IIIA (see Annex III) may have 
been  too  ambitious  for  developing  technical  solutions  for  tractors  to  meet  Stage  IIIB 
requirements. The changes in PM and NOx limits are substantial, as can be seen in Annex III, 
last table: for PM, a reduction by 88 to 94 % is required. 

This  was  recognised  in  2005  in  Directive  2005/13/EC  and  the  flexibility  scheme  was 
introduced as a solution.  

3.6. 

Influence of the economic crisis and other relevant factors 

From  early  2009  onwards  most  of  the  EU  based  industry  producing  tractors  has  been 
unexpectedly and severely hit by the global financial and economic crisis. Steep falls in sales 
caused a large decrease in income and available capital to finance the necessary technology 
research  and  development  for  tractors  with  Stage  IIIB  compliant  engines  in  all  power 
categories and applications within the time limits in the Directive. Firms prioritise their R&D 
expenditure  to  cover  firstly  those  products  with  high  existing  and  potential  sales  volumes. 
These  sales  then  provide  the  business  with  revenues  that  can  be  used  for  R&D  in  order  to 
develop technical solutions for smaller niche markets.  

For tractors the market in Europe started to drop sharply in the 1st quarter of 200931; the sales 
over the year 2009 have dropped by 20 % in units compared to 2008 (approximately 180 000 
in EU15 for 2008. No figures are available for EU12; for all tractors this is estimated to be 
15%  of  the  total).  According  to  CEMA  the  turnover  in  2009  decreased  by  20  to  25% 
compared to 2008. This is the consequence of the decrease in downstream demand. For 2010 
tractor manufacturers are expecting a further 5 to 10% decrease32. Figures for the 1st quarter 
2010 show a 22% decrease compared to 2009. 

Clients of tractor manufacturers are currently much more prudent towards buying new tractors 
as a result of the economic climate, including the lower prices that farmers generally get for 
their products. For various products like oats, wheat, barley etc the lowest price level in 10 
years according to AGRIVIEW (EC-AGRI). CEMA reported a drop in farm income for 2009 
of 12% for EU27, up to 25% for Italy and 21% for Germany, compared with 2005 (source: 
EUROSTAT). Users cut capital costs by extending the use of old tractors and not purchasing 
newer, cleaner tractors, thus causing a larger negative environmental impact in the short term. 

The  end-user  may  not  be  able  to  buy  a  new  tractor,  at  least  not  from  his  regular  source, 
because  of  unavailability  of  a  compliant  type  from  his  manufacturer.  As  a  consequence  he 

31 

32 

Reference: CEMA letter ''Background material for the Request to Enlarge Flexibility from 20% to 50% 
for  Stage  IIIB'',  14-07-2009,  addressed  to  Commission  Services.  Additional  information  on  market 
share  can  be  found  in  the  study  'Competitive  analysis  of  the  EU  Mechanical  Engineering',  p.  4, 
available at the link: http://ec.europa.eu/enterprise/mechan_equipment/companalysis-eu-mechengin.pdf 
Email from CEMA to ENTR-F.1 dated 18.02.2010. 

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will have to continue using his old tractor, which is even more polluting than the IIIA tractors. 
Alternatively he could buy a used, older tractor, with poor emission performance. 

The  old  tractors  will  be  more  costly  in  maintenance  and  fuel  consumption,  as  well  as  less 
efficient in performing the work. For some additional information on increased maintenance 
costs, see Annex XI. However, there are severe limitations to the available data, such that no 
estimate can be provided on the overall magnitude of increased maintenance cost. 

3.7. 

How will the situation develop? 

If the current regulatory framework is maintained without additional measures to alleviate the 
burdens of the crisis, the following developments are expected: 

•  Tractor  manufacturers  will  place  tractors  on  the  market  under  the  currently  allowed 
flexibility scheme of 20% until the completion of this allowance. Only a limited number of 
new tractor types compliant with Stage IIIB will be available in early 2011. Users / buyers 
will  have  to  postpone  buying  a  new  tractor  of  their  choice,  change  to  another  brand  (if 
available) or buy a used tractor. 

•  Due to the drop of sales, the funds to further develop and finalise the required adaptations 
of  tractor  bodies  and  production  lines  will  not  be  available  as  estimated  and  planned 
incoming cash flow will be limited. 

•  One likely course of action will be that the tractor manufacturers will reduce the number of 
types of tractors they produce, to cut compliance costs, which will consequently lead to the 
loss of the market and of customers, making tractor manufacturers'  future incoming cash 
flows smaller.  

•  In order to fund their activities, tractor manufacturers usually tend to turn to the financial 
institutions  for  loans.  However,  in  particular  against  an  environment  characterised  by  a 
general financial crisis, banks are expected to more systematically require a solid turnover 
in order to provide financing. The risks of funds not being obtained are increased. 

•  The tractor manufacturers, after having exhausted the flexibility allowance would not be in 
a  position  to  produce  next  stage  compliant  tractors  as  they  would  not  generate  revenues 
from sales necessary to cover expenditure on R&D and would thus not have a product to 
place on the market.33 

•  This would negatively affect not only tractor manufacturers and their suppliers but also end 
users.  End  users  (farmers  and  contract  workers)  would  not  be  able  to  purchase  any  new 
tractor  where  a  IIIB  compliant  tractor  model  is  not  available  when  the  new  stage  enters 
into force. This would mean that the only way to buy a tractor would be through the second 
hand market. Such tractors would only comply with earlier emission limit stages. 

33 

In the extreme case of 0% compliance this would be the case after 2,4 months; the allowed 20% would 
then be fully used. 

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3.8. 

Does the EU have the right to act? 

The  legal  basis  of  this  initiative  is  the  same  as  for  the  tractors  emissions  Directive 
2000/25/EC, namely Art. 114 of the TFEU.  

The Directive already harmonises the laws of the Member States relating to emission limits 
and the type-approval procedure for engines to be installed in tractors. Any modifications to 
the  Directive  can  only  be  done  at  EU  level.  There  is,  however,  a  risk  that  Member  States 
might  resort  to  national  measures  once  the  current  flexibility  scheme  is  exhausted  and  no 
more  tractors  can  be  put  on  the  market.  This  might  lead  to  a  fragmentation  of  the  internal 
market and unlevel playing field between different Member States. 

Therefore EU action is necessary and provides value added in maintaining the internal market 
for tractors. 

4. 

OBJECTIVES 

The general objective of the proposal is to maintain the internal market for tractors 
and to maintain a high level of environmental protection.  

The table 1 below describes the general, specific and operational objectives. 

GENERAL 

SPECIFIC 

OPERATIONAL 

1. Maintain the 
functioning of 
the internal 
market for 
tractors 

1. Maintain a level playing field 
for tractor producers by 
upholding a harmonised 
regulatory framework across all 
Member States (and thus 
eliminating the risk of national 
deviations). 

2. Prevent the foreseeable 
aggravation of an already difficult 
economic situation for the tractor 
industry that has been caused by 
the economic crisis. 

3. Ensure that demand for new 
tractors can be satisfied by 
industry. 

1. Introduce a cost-effective and 
timely measure that will allow EU 
producers to keep selling tractors 
under the same rules across the EU 
and will allow users to replace end of 
life tractors.  

2. Allow tractor manufacturers to 
generate revenues that can be used to 
invest in the necessary R&D to 
comply with foreseen emission limits. 

2. Protect the 
environment  

1. Reduce the risk that older, 
more polluting (pre-Stage IIIA) 
tractors cannot be replaced by 
newer cleaner tractors, i.e. make 
sure that the potential for 
emission reductions from 
replacing end of life tractors is 

1. Enable the replacing of older, more 
polluting and fuel consuming engines 
and tractors by cleaner ones by 
adjusting the emission requirements 
in such a way that demand for new 
tractors can be met by the cleanest 
available models.  

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not jeopardised. 

2. Maintain the incentive for the 
industry to invest in R&D 
necessary to develop cleaner 
tractors compliant with the 
foreseen future emission limit 
stages.  

2. Send a clear signal to industry that 
further emission reductions are 
required and that the current path of 
reducing emissions is maintained. 

4.1. 

Consistency with other horizontal objectives of the European Union 

4.1.1. 

The European Economic Recovery Plan and EU2020 Strategy 

The present proposal is in line with the objectives of the EU 2020 Strategy and complements 
the  European  Economic  Recovery  Plan  (EERP)34.  Adopted  in  November  2008,  the  EERP 
addresses the difficulties of the wider economy brought about by the global financial crisis. 
The Plan outlines a series of measures to cope with the squeeze on credit, declining sales and 
revenues.  It  refers  inter  alia  to  the  need  for  a  swift  stimulation  of  demand  and  consumer 
confidence  as  well  as  measures  to  lessen  the human  cost  of  the  economic  downturn  and  its 
impact  on  jobs.  The  EERP  highlights  the  need  to  ensure  full  coherence  between  immediate 
actions and the EU’s medium- and longer term objectives.  

Such immediate action needs to focus on improving business conditions through maintaining 
the  competitive  industrial  base  and  through  promoting  knowledge  based  and  low  carbon 
economy as set out in the EU2020 Strategy.  

4.1.2. 

Environmental EU Policies 

The  tractors  emissions  Directive,  which  provides  an  important  contribution  to  a  progressive 
reduction  of  targeted  emissions,  is  also  in  line  with  the  EU  environmental  policies,  in 
particular with the Sixth European Environment Action Programme and one of its initiatives - 
Clean Air For Europe (CAFE). The initiative sets out an integrated and long term strategy for 
reducing  the  adverse  impact  of  air  pollution  on  human  health  and  environment.  These 
objectives  are  implemented  through  Directive  2008/50/EC35  on  ambient  air  quality  and 
"Cleaner Air For Europe" which establishes a system for the assessment of ambient air quality 
and  provides  thresholds  for  each  pollutant.  Member  States  have  to  assess  and  manage  the 

34 
35 

COM (2008) 800 
Directive 2008/50/EC of the European Parliament and of the Council of 21 May 2008 on ambient air 
quality  and  cleaner  air  for  Europe  (AAQD)  entered  into  force  on  11  June  2008.  It  merges  existing 
legislation  into  a  single  directive  with  no  change  to  existing  air  quality  objectives  for  PM10  and  NOx 
contained  in  Directive  1999/30/EC;  maintains  two  limit  values  for  NOx  based  on  hourly  and  annual 
average  concentrations;  sets  (new)  air  quality  objectives  for  PM2.5  including  the  limit  value  and 
exposure related objectives – exposure concentration obligation and exposure reduction target; creates 
the possibility for time extensions for compliance up until June 2011 for PM10 (where the limit values 
entered into force on 1 January 2005) or up until 31 December 2014 for NO2 and benzene) based on 
conditions and the assessment by the European Commission. Single most important condition is that the 
notification  must  include  an  air  quality  plan  that  delivers  compliance  by  the  extended  deadline  for 
compliance. 

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ambient  air  quality.  Besides  this  instrument  it  remains  important  to  combat  emissions  of 
pollutants at the source and to implement the most effective emission reduction measures.  

5.  POLICY OPTIONS 

5.1. 

Introduction 

The  issues  highlighted  in  the  problem  definition  and  the  subsequent  objectives  warrant  an 
interim  measure  to  mitigate  the  impact  of  the  economic  downturn.  The  options  described 
hereafter are based on the recent IA for Non-Road Mobile Machinery. In addition a scrapping 
scheme is also considered based on experience with the passenger car sector. 

It should be emphasised, that it is not envisaged to introduce an amendment to the flexibility 
scheme  for  the  transition  from  Stage  IIIB  to  IV.  According  to  industry,  the  R&D  work  for 
Stage IIIB is at the same time a good basis for getting Stage IV approvals in due time. It is 
therefore  expected  that  adaptation  costs  for  transition  from  Stage  IIIB  to  Stage  IV  will  be 
significantly  lower  than  those  from  Stage  IIIA  to  Stage  IIIB;  therefore  the  Commission 
services consider that no additional flexibility is needed for the transition to Stage IV.  

5.2. 

Options 

•  Option 1 - No action = Baseline scenario 

The  provisions  of  the  current  flexibility  scheme  remain  unchanged,  i.e.  20%  (or  absolute 
numbers of engines) continue to apply.  

•  Option  2  -  Provision  of  government  backed  loans  for  purchasing  stocked  engines 

manufactured under the so called sell-off period 

Article  4  of  Directive  2000/25/EC  states  that  'requirements  shall  be  postponed  by  two  years  in 
respect  of  engines  with  a  production  date  prior  to  the  said  date',  the  'said  date'  being  one  of  the 
deadlines specified in point 2 of that article, after which non-compliant engines and tractors 
shall not enter into service anymore. 

While Stage IIIA is in force, industry may produce engines and tractors and stock them in the 
EU  territory.  These  Stage  IIIA  engines  and  tractors  are  manufactured  to  keep  industries 
running  and  to  cover  the  needs  of  other  countries  that  do  not  have  exhaust  emissions 
limitations as strict as EU. After the beginning of implementation of Stage IIIB (between 1-1-
2010 and 1-1-2013 depending on the power category) these stocked engines and tractors may 
be placed on the market for a period of two years. This option suggests the use of government 
backed  loans  in  the  form  of  loan  guarantees  provided  by  Member  States  to  tractor 
manufacturers in order to enable them to purchase Stage IIIA engines on stock.  

•  Option 3 - Implementation of a scrapping scheme. 

The use of a scrapping scheme would be a subsidy, given as an incentive, to the user to buy 
new tractors with a Stage IIIB engine.  

Under  this  option,  the  owner  of  an  older,  more  polluting  tractor  will  deliver  the  tractor  for 
scrapping (destruction-recycle etc). A national public authority would grant a lump sum to the 

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owner  of  the  scrapped  tractor.  The  owner  will  receive  the  money  via  banking  or  the  tax 
system when the purchase of new the tractor is proven. 

•  Option 4 – Implementation of alternative types of provisions under the existing flexibility 

scheme 

Under  this  option  additional  flexibility  will  be granted  for  the  transition  from  Stage  IIIA  to 
Stage  IIIB.  No  additional  measures  for  future  stages  are  envisaged.  Several  different  sub-
options are considered: 

- Option 4.1 - Implementation of a scaled percentage of the flexibility scheme for the various 
categories  of  tractors,  depending  on  the  particular  transitional  problems  from  Stage  IIIA  to 
Stage IIIB plus a similar approach with regard to the fixed numbers of engines as set in Table 
2.  

-  Option  4.2  -  Increase  of  flexibility  percentage  to  35%  for  all  tractors  and  proportionate 
adjustment of the fixed numbers of engines.  

The maximum number of engines placed on the market under a flexibility scheme is increased 
to  35%  (midway  between  20  and  50%)  of  the  manufacturer's  past  annual  sales  of  tractors 
with engines in that power category.  

The  tractor  manufacturer  would  have  the  choice  to  alternatively  not  exceed  the  fixed 
maximum number of engines (see Table 2 and Annex IV).  

The system of flexibility and fixed numbers is explained in Annex IV, with calculation of new 
fixed numbers for 35, 50 and 80% flexibility. 

-  Option  4.3  -  Increase  of  flexibility  percentage  to  50%  for  all  tractors  and  proportionate 
adjustment of the fixed numbers.  

The maximum number of engines placed on the market under a flexibility scheme is increased 
to  50%  of  the  tractor  manufacturer's  past  annual  sales  of  equipment  with  engines  in  that 
engine  category.  This  change  would  be  coherent  with  the  Commission's  proposal  for  the 
NRMM sector. 

The  tractor  manufacturer  would  have  the  choice  to  alternatively  not  exceed  the  fixed 
maximum number of engines (see Table 2 and Annex IV). 

This new percentage or the amended fixed number of engines may be distributed, according 
to the tractor manufacturer's production plan, over the duration of Stage IIIB.  

Initially  a  figure  of  40%  was  proposed  as  an  option  to  be  further  investigated  for  mobile 
machinery, in order to amend the provisions of the flexibility scheme during the first steps of 
the Technical Review of the Directive in 2006. This initial figure was decided via numerous 
consultations  with  contributions  from  Member  States,  industry  and  various  stakeholders.  It 
was  assessed  as  the  figure  that  would  generate  sufficient  revenues  for  the  tractor 
manufacturers in order to fund the R&D and compliance costs for the transition from Stage II 
to  Stage  IIIA  and  have  the  least  environmental  burden.  During  the  course  of  the  Technical 
Review  however  and  after  reassessing  the  non-road  inventory,  as  mandated  in  Article  2  of 
Directive 2004/26/EC, it emerged that an increase to 50% would be needed in order to allow 

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manufacturers  to  comply  with  the  Directive.  It  was  considered,  additionally,  that  the  new 
figure  would  provide  better  alignment  of  the  EU  provisions  of  the  flexibility  scheme  to  the 
ABT system used in the USA (see 1.4 above). 

For those engines in power categories for which no Stage IIIB and/or IV exists and for those 
engine  categories  where  implementation  of  Stage  IIIB  starts  at  a  later  date  than  1 January 
2011,  a  time  limit  should  be  included  so  as  to  restrict  the  placing  on  the  market  of  tractors 
under the revised flexibility scheme until 31 December 2013. This date is selected in order to 
comply  with  the  main  objective  of  the  proposal:  to  alleviate  the  burden  of  the  current 
economic crisis and to provide a 'similar' three years time of implementation of the flexibility 
scheme to all engine power categories since starting time of Stage IIIB differs. 

-  Option  4.4  -  Increase  of  flexibility  percentage  to  80%  for  all  tractors  and  proportionate 
adjustment of the fixed numbers of engines.  

The maximum number of engines placed on the market under a flexibility scheme is increased 
to  80%  of  the  tractor  manufacturer's  past  annual  sales  of  equipment  with  engines  in  that 
power category. This option would seek to align the European system of flexibility to the U.S. 
ABT  system  to  the  largest  extent  possible  while  still  maintaining  a  fundamentally  different 
system (no averaging, banking or trading in the EU). As mentioned earlier, the U.S. system is 
similar to granting flexibility of 80% in the EU system. 

The  tractor  manufacturer  would  have  the  choice  to  alternatively  not  exceed  the  fixed 
maximum number of engines (see Table 2 and Annex IV). 

Table 2: Maximum number of engines to be sold under the current and the revised flexibility schemes 

Engine 
category  

(kW) 

19-3736 

37-56 

56-75 

75-130 

130-560 

Number of engines 

Number of engines 

Number of engines 

Number of engines 

(existing scheme up 
to Stage IIIA, 20%) 

(revised scheme for 
transition from 
IIIA to IIIB, 35%) 

(revised scheme for 
transition from 
IIIA to IIIB, 50%) 

(revised scheme for 
transition from 
IIIA to IIIB, 80%) 

200 

150 

100 

50 

- 

140 

123 

175 

88 

- 

200 

175 

250 

125 

- 

320 

280 

400 

200 

- Option 4.5 - Conditional expansion of the flexibility scheme, with penalty mechanism.  

36 

Stage IIIB is not applicable to this power category. 

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In  order  to  maintain  the  incentives  to  develop  Stage  IIIB  engines,  a  system  could  be 
introduced where additional flexibility used in the transition from stage IIIA to Stage IIIB will 
trigger payment of a penalty after several years.  

This would maintain the incentive for the tractor manufacturers to develop tractors with IIIB 
engines and use only the minimum additional flexibility they need. It requires a penalty to be 
set at the right level. 

A variant of this option would be to not have a financial penalty but to deduct any additional 
flexibility used for the transition from IIIA to IIIB from the flexibility that will be available 
for the transition from IIIB to IV (20%). 

- Option 4.6 - Implementation of a trading system  

A  system  similar  to  that  of  the  EU  Emissions  Trading  Scheme  could  be  developed  for  the 
flexibility  measure.  A  system  could  be  established  whereby  firms  that  would  not  use  the 
entire flexibility could sell their flexibility rights to firms that need additional flexibility. This 
scheme  would  require  a  mechanism  to  sell  flexibility  (permits)  and  a  system  in  place  to 
monitor  the  scheme.  The  price  of  each  permit  of  flexibility  would  be  determined  by  the 
market.  

-  Option  4.7  -  Replace  the  flexibility  scheme  by  a  combination  of  flexibility  for  tractor 
manufacturers and ABT, as applied in the USA. 

An  ABT  scheme  similar  to  the  one  used  in  the  USA  could  be  developed  for  engine 
manufacturers, together with a flexibility scheme for the tractor manufacturers. 

6.  OPTION ANALYSIS – PRELIMINARY ANALYSIS  

This IA will assess the options in a qualitative way with respect to the criteria of efficiency, 
effectiveness, coherence and feasibility in order to establish a preferred option. The preferred 
option  will  then  be  analysed  in  greater  detail  with  respect  to  the  economic,  social  and 
environmental impacts.  

6.1. 

Analysis of Option 1 – Baseline 

The situation under the baseline scenario would be as follows: engine manufacturers (around 
10 companies in the EU) will continue the engine development programme that was started 
following  publication  of  the  amending  directive  in  2005.  A  variation  of  technologies  was 
known  in  principle,  ranging  from  optimising  the  engine  (internal  combustion  aspects,  high-
pressure injection in stead of diesel pumps etc) to various options for after-treatment, all with 
their  advantages  and  drawbacks.  The  known  technologies  also  needed  to  be  adjusted  to  the 
specific application of the tractors and their working environment and conditions, compared 
to  road  vehicles  for  which  they  were  often  developed.  Based  on  the  fact  that  most  engine 
manufacturers  are  independent  from  the  tractor  manufacturers,  the  latter  will  have  to  adapt 
their vehicles once the design of the engine is final (normally: after it has been shown that the 
engine has been approved compliant with the directive). Only in the few cases of "integrated" 
manufacturers,  who  produce  their  own  engines,  the  adaptation  of  the  tractor  design  (and  its 
production line etc) can be done earlier. 

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The policy option of doing nothing would not be effective in reaching the objectives for the 
reasons  described  in  section  3.7.  To  recall,  by  doing  nothing  industry  would  continue  to 
struggle  in  the  current  economic  climate  and  would  not  have  tractors  ready  for  Stage  IIIB. 
Industry would then not be able to place products on the market beyond what is offered in the 
20% flexibility scheme; they may have to close down certain product lines if they are not able 
to get their products adapted to the new stage of requirements; they will not be allowed to sell 
their Stage IIIA compliant tractors. 

Some  firms  would  subsequently  go  (temporarily)  out  of  business  which  would  lead  to  job 
losses. Especially for SMEs this might mean risk of closing down their business, due to the 
limited number of products and their limited resources 

The  baseline  scenario  assumes  that  industry  will  in  general  be  unable  to  fund  the  R&D 
necessary for Stage IIIB. Most companies face serious difficulties to finance the investment 
necessary to ensure compliance of equipment with IIIB emission limits.  

6.2. 

Analysis  of  Option  2  -  Provision  of  government  backed  loans  for  purchasing 
stocked engines manufactured under the so called sell-off period. 

Due  to  the  economic  crisis,  private  banking  institutions  are  reluctant  to  provide  credit  to 
industry.  A  government  backed  loan  (in  form  of  a  loan  guarantee  offered  by  national 
administrations  or  the  European  Investment  Bank),  would  enable  tractor  manufacturers  to 
purchase  engines  from  an  engine  manufacturer,  stock  them  and  continue  selling  IIIA 
compliant  tractors  after  the  entry  into  force  of  the  stage  IIIB.  The  revenues  generated  from 
these  sales  would  enable  tractor  manufacturers  to  finance  the  R&D  necessary  to  develop 
Stage IIIB tractors. 

Moreover, the incentive to produce more Stage IIIA engines would result in a large number of 
Stage  IIIA  engines  being  produced  and  bought  by  tractor  manufacturers,  instead  of  the 
development of cleaner Stage IIIB engines; this would act as a counter incentive to innovate 
and develop more environmentally friendly machines.  

There would also be the risk that extra demand for stocked Stage IIIA engines might lead to 
higher  prices  for  those  engines  in  the  short  term  (particularly  due  to  capacity  constraints), 
which  would  subsequently  require  increasing  the  level  of  loans  requested  by  tractor 
manufacturers. One other important issue related to the use of stocked engines is that special 
treatment37  is  required  for  those  engines  that  had  been  stocked  for  over  three  months.  Such 
treatment is time consuming, costly and can reach up to 5% of the sale price of the engine. 
Therefore this option is not feasible as a timely measure. 

In addition, this option raises issues regarding compatibility with the EU state aid provisions. 

37 

When the engine is manufactured to be stocked, it is filled with a special oil. When it is placed on the 
tractor,  this  oil  must  be  changed  to  a  specific  one  and  then  with  a  specific  fuel  the  engine  is  kept 
running for a few hours. After that period the oil must be changed again to normal and with a normal 
fuel it must run for some time and then it is ready and safe to be sold. The required time and cost of the 
procedure depend on the size of the engine and its power. 

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6.3. 

Analysis  of  Option  3  -  Implementation  of  a  scrapping  scheme  (on  a  national 
basis) 

The use of a scrapping subsidy will provide an incentive to the users to buy new tractors with 
a cleaner Stage IIIB engine, under the condition that they officially destroy their older, more 
polluting tractor.  

This will encourage the purchase of Stage IIIB tractors and will have positive environmental 
impacts. However, it will not assist tractor manufacturers in financing the R&D to make Stage 
IIIB  tractors  available.  Whether  the  prospect  of  a  scrapping  scheme  would  be  sufficient  to 
induce banks to hand out additional loans to tractor manufacturers for R&D remains doubtful. 
In addition, if Member States implemented the scrapping scheme in different ways, this could 
lead to a fragmentation of the internal market and to distortion of competition. 

In any event, no plans from any MS to introduce a scrapping scheme for this sector are known 
to the Commission and given the currently tight national budgets, no financial means might 
be available for it. 

6.4. 

Analysis of Option 4 – Implementation of alternative types of provisions under 
the existing flexibility scheme 

6.4.1. 

Option  4.1  -  Implementation  of  scaled  percentages  of  flexibility  for  the 
different  types  of  tractors,  depending  on  the  problems  they  encounter  for  the 
transition from Stage IIIA to Stage IIIB. 

Industry's priority is to develop initially tractors that face fewer problems and for bigger sale 
volumes  and  to  progressively  address  smaller  niche  market  tractors  with  weight  and 
dimension  constraints.  Therefore,  an  alternative  allowance  under  the  flexibility  scheme  for 
each one of these categories of tractor would be a logical solution. 

There is no specific inventory of the tractors in each category when placed on the market nor 
a  relevant  system  to  survey  the  number  of  sales.  The  current  system,  surveying  the 
implementation  of  the  tractors  sold  using  flexibility  does  not  require  such  detailed 
information. 

However, gathering information on the amount of problems for each specific type of tractor is 
very  difficult.  It  is  a  common  approach  for  engine  and  tractor  development  to  use  the 
experience and progress gained from one type to another. The implementation of this option 
would  require  the  delivery  of  sensitive  information  to  the  Commission,  to  be  used  as  a 
background for determining figures of alternative flexibility. 

This  measure  would  optimise  the  trade-off  between  environmental  costs  and  economic 
benefits within the flexibility scheme provided there was perfect information on the basis of 
which a decision on how to allocate flexibility could be taken. However, this information is 
not  available  and  this  makes  this  option  unfeasible.  It  will  therefore  not  be  analysed  any 
further as being unfeasible. 

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6.4.2. 

Option  4.2  -  Increase  of  flexibility  percentage  to  35%  and  proportionate 

adjustment of the fixed numbers of engines.  

As to effectiveness 35% would not alleviate the burden for manufacturers enough. In addition 
this would not be coherent with the solution chosen for NRMM, where both sectors are facing 
the  same  situation.  As  to  environmental  effects  the  option  would  lead  to  slightly  more  IIIA 
tractors  coming  on  the  market  (see:  table  2  for  exact  numbers),  thus  a  negative  effect  on 
environment, but on the other hand these IIIA tractors would mostly replace more polluting 
older  tractors.  The  same  would  apply  to  safety  and  efficiency  of  these  tractors:  a  slight 
positive effect when compared to the baseline. 

6.4.3. 

Option  4.3  -  Increase  of  flexibility  percentage  to  50%  and  proportionate 

adjustment of the fixed numbers.  

Allowing an extended flexibility in all tractor categories will facilitate the adjustment process 
to stage IIIB by allowing tractor manufacturers to not have to redesign all tractor models at 
once.  The  additional  flexibility  does  not  require  any  up-front  payments  from  industry.  This 
change would be coherent with the Commission's proposal for the NRMM sector. 

However, there would be environmental harm from allowing more Stage IIIA tractors on the 
market. The environmental impacts will be analysed in detail in section 7.1. 

6.4.4. 

Option  4.4  -  Increase  of  flexibility  percentage  to  80%  and  proportionate 

adjustment of the fixed numbers of engines.  

This option would allow industry to put existing tractors on the market to a larger extent than 
options  4.2  and  4.3.  It  should  therefore  lower  compliance  costs  of  industry  and  allow  more 
time to carry out the required R&D. In addition, this option would further align the EU system 
to the U.S. system, even though this is much more complicated and cannot be used in the EU. 

However,  this  option  would  lead  to  additional  environmental  harm  by  allowing  more  Stage 
IIIA tractors on the market than necessary for industry to overcome the problems relating to 
introduction of the new emission limits at this time of crisis. In line with the reasoning given 
in  footnote  39,  if  all  of  the  flexibility  was  used  straight  away  in  the  current  20%  flexibility 
scheme then the manufacturer could delay using Stage III B by 10 weeks; instead, under 80% 
flexibility the manufacturer can delay by 40 weeks. Therefore, assuming constant sales, this is 
an extension of 30 weeks (if he would use the full allowance for all types straight away). 

Industry  representatives  have  informed  the  Commission  services  that  50%  flexibility  would 
be all that is necessary for industry to comply with the Directive. 

To  cause  unnecessary  environmental  damage  would  not  be  consistent  with  the  fundamental 
environmental  policy  objectives  of  the  EU.  In  addition  this  would  not  be  coherent  with  the 
solution chosen for NRMM (50%), while both sectors are facing the same situation. 

6.4.5. 

Option  4.5  -  Conditional  use  of  the  flexibility  scheme,  with  penalty 

mechanism. 

The users of the additional flexibility for transition from Stage IIIA to IIIB would be subject 
to a penalty. This could either take the form of a financial penalty that would need to be paid 

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at a later point in time or, alternatively, it could be a "penalty" in kind that would consist of a 
reduction of future flexibility, e.g. for the transition from Stage IIIB to Stage IV. 

This  approach  would  limit  concerns  that  competitive  distortions  may  occur  from  enlarged 
flexibility. For instance, those firms that have already invested in getting Stage IIIB compliant 
tractors  ready  could  be  at  a  competitive  disadvantage  compared  to  those  that  have  not 
invested yet;  as  the ones who are ready, are going to have to price their  products to recoup 
their investments. This system would therefore reduce the adverse incentives of Option 4.3. 
However,  there  is  a  lack  of  information  available  and  complications  that  makes  this  option 
unrealistic:  No  information  exists  that  would  help  to  determine  the  correct  amount  of  a 
penalty  that  would  incentivise  tractor  manufacturers  to  limit  the  amount  of  additional 
flexibility  to  the  optimal  level  from  an  environmental  and  economic  point  of  view. 
Furthermore, there is a risk that a firm would use the maximum established percentage under 
the enlarged flexibility scheme to gain the advantage for the transition from Stage IIIA to IIIB 
and then if obliged to pay a penalty, it could be tempted to change name or ownership status 
to avoid paying it.  

Moreover,  it  is  noteworthy  that  according  to  the  industry,  Stage  IV  engines  will  be  based 
mostly on those compliant with Stage IIIB. It is therefore expected that adaptation costs for 
transition from Stage IIIB to Stage IV will be lower than those from Stage IIIA to Stage IIIB; 
therefore  the  Commission  services  consider  that  no  additional  flexibility  (above  the  20% 
already included in the Directive for stage IV) are necessary.  

Further,  creating  and  implementing  such  a  system  would  place  additional  administrative 
burden on MS since they have to put a system in place to either impose the financial penalties 
later or to manage databases that would allow to determine how much flexibility needs to be 
reduced  per  power  category  for  each  manufacturer in the next transition phase from IIIB to 
IV.  If  the  measure  was  to  be  harmonised  and  implemented  with  the  same  terms  to  all  MS, 
additional  costs  and  problems  would  arise  regarding  funding  resources,  notification  and 
surveillance  costs  in  EU  level,  translation  costs,  etc.  The  implementation  cost  of  such  a 
measure would be substantial. Therefore this option is considered unfeasible. 

6.4.6. 

Option 4.6 - Implementation of a trading system. 

This option foresees a scheme in which firms that require additionally flexibility buy it from 
those that do not need it. This option has the effect of maintaining the incentives to innovate 
for those firms that have the lowest cost to do so while at the same time allowing firms with 
higher costs to comply with the tighter emission limits to postpone the adjustment (at least for 
some models). Such an option would set incentives to innovate at an efficient level. The price 
of the permit would be determined by the market and would reflect the costs of development 
to  comply  with  Stage  IIIB  (on  the  margin,  i.e.  for  the  firm  that  is  just  indifferent  between 
using flexibility or selling it): if it was cheaper for a firm to spend the extra resources to reach 
Stage IIIB rather than purchase the flexibility, then they would not buy the flexibility but they 
would invest in R&D instead. 

As in the case of government backed loans, a trading system would be very complex to put in 
place in a short time. This would not be effective in meeting the immediate requirements of 
industry. Additional EU and national resources would be required to set up and regulate this 
system. This scheme would not help the firms who are experiencing problems in cash flow to 

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dedicate to R&D to reach Stage IIIB. Those firms not ready for Stage IIIB would either have 
to pay for flexibility or for additional R&D. 

6.4.7. 

Option 4.7 – Introduction of ABT scheme. 

Alternatively  an  ABT  scheme  for  engine  manufacturers  similar  to  the  one  used  in  the  USA 
could  be  developed,  together  with  a  flexibility  scheme  for  the  tractor  manufacturers. 
Advantages of ABT would be that manufacturers that are quick with their new products can 
build up credits, to be used to compensate for their engine types that are not yet compliant, or 
can be sold to competitors that are slower. Also, use of an ABT system might allow an earlier 
introduction of new requirements.  

The  introduction  of  an  ABT  system  in  the  EU  was  proposed  when  the  amendments  to 
Directive 2002/88/EC were discussed. However, this idea was rejected by Member States and 
Parliament because it was too complex for implementation in the legislation of MS and too 
difficult to monitor. In addition it would not work for smaller manufacturers. To be noted that 
ABT would bring serious administrative burden to manufacturers, who have to predict their 
production  in  different  engine  families  before  the  year  (numbers,  engine  emissions 
performance  etc)  and  calculate  the  outcome  at  the  end  of  the  year,  keeping  records  of  all 
shipments. National authorities would have to check these. 

6.5. 

Comparison of the Options 

The  options  will  now  be  qualitatively  assessed  against  their  effectiveness,  efficiency  and 
coherence in meeting the objectives. A table with a detailed comparison of the options can be 
found in Annex X. A summary comparison is presented in Table 3 at the end of this chapter.  

The opinion of the stakeholders is reproduced in Annex V. 

•  Option 1 - No action = Baseline scenario 

A  no-action  option  is  not  effective  in  reaching  the  objectives  as  industry  would  continue  to 
struggle and would not have compliant tractors ready for Stage IIIB. 

•  Option 2 - Provision of government backed loans for purchasing stocked engines 

This option would provide tractor manufacturers with the access to finance the purchases of 
Stage  IIIA  engines  and  would  allow  them  to  continue  to  generate  revenue  necessary  to 
develop  Stage  IIIB  compliant  tractors.  However,  the  control  of  stocked  engines  and 
surveillance by type approval authorities of Member States is close to impossible, since such 
a  surveillance  system  currently  does  not  exist  and  it  would  require  time  and  financial 
resources  to  be  established,  certified  and  operated  in  practice.  This  scheme  is  similar  in  its 
effect to extending flexibility by allowing tractor manufacturers to put Stage IIIA compliant 
engines  on  the  market  during  Stage  IIIB,  but  will  front  load  engine  sales  which  could 
introduce capacity constraints for the production of Stage IIIA engines. This option would be 
more  expensive  for  tractor  manufacturers  due  to  the  stocking  (additional  fees  and 
transportation costs) involved, it is much more difficult to monitor by authorities and includes 
the  associated  administrative  costs  of  providing  loan  guarantees  and  the  actual  loans. 
Therefore this option is not efficient compared to option 4.3.  

•  Option 3 – Implementation of a scrapping scheme 

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A  scrapping  scheme  will  stimulate  demand  for  Stage  IIIB  compliant  tractors  but  will  not 
assist  in  helping  tractor  manufacturers  develop  compliant  tractors;  it  may  be  effective  in 
reaching environmental objectives on condition that the scheme as well as compliant tractors 
are available. Substantial funds will be required to provide loans under a scrapping scheme, 
which may at present not be available and distortions of the internal market could occur from 
diverging  national  schemes.  If  technical  solutions  are  not  yet  available  a  scrapping  scheme 
will not work. It raises additional concerns regarding compliance with state aid rules.  

•  Option 4.1 - Implementation of a scaled percentage of the flexibility scheme  

This system would be effective and efficient in meeting the objectives and providing targeted 
support where additional flexibility was required. However, there is no specific inventory on 
which these assessments could be made, therefore, this system is not feasible. 

•  Option 4.2 - Increase of flexibility percentage to 35% 

Similar to what is described below for option 4.3, with the following differences: 35% would 
not  be  coherent  with  the  NRMM  proposal  (50%);  it  would  bring  less  reduction  of  the 
distortion  with  the  US  market;  for  impact  on  the  environment  this  option  would  be  the 
equivalent of a 13 week delay in the introduction of Stage III B. For safety and efficiency of 
working with the tractors this option is better than the baseline (as more of the older tractors 
will  be  replaced  by  Stage  IIIA  tractors  which  are  also  modernised  and  improved  in  these 
respects), but less than option 4.3. 

•  Option 4.3 - Increase of flexibility percentage to 50% 

A uniform increase to 50% would avoid the information issue from the option 4.1 and would 
provide assistance to industry in the short term. This additional flexibility could be introduced 
without setting up any new systems and therefore could provide an immediate response to the 
crisis.  The  option  would  be  coherent  with  NRMM  and  reduce  the  distortion  with  the  US 
market where an even larger flexibility is allowed. 

To put this extension into context, the 50% flexibility is the equivalent of a 16 week delay in 
the introduction of Stage III B38 (if the manufacturer would choose to use the flexibility for all 
of his models fully from the start date). If a tractor manufacturer will not be in a position to 
produce  Stage  IIIB  engines  after  the  use  of  its  allowance  of  50%  of  engines  of  Stage  IIIA, 
then it may disappear from the market.  

There  is  a  trade  off  between  the  economic  incentives  and  the  environmental  pressures.  In 
order that industry can ensure production of Stage IIIB tractors, and thus be able to continue 

38 

The flexibility scheme today basically allows that a manufacturer sells 'old' tractors up to 20% of his 
annual sales, meaning that 80% must already comply with the new limits; this allows him to concentrate 
his R&D work on a limited number of 'best selling'' types and update the others types later (e.g. in the 
second or third year). He is free to choose when he uses this allowance; he can use it fully in the first 
few months, but then all models should be ready soon and at the same time. If all of the flexibility was 
used straight away in the current 20% flexibility scheme then the manufacturer could delay using Stage 
III B by 10 weeks, instead, under the proposed 50% flexibility the manufacturer can delay by 26 weeks. 
Therefore, assuming constant sales, this is an extension of 16 weeks (if he would use the full allowance 
for all types straight away). 

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29 

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selling  in  the  future,  there  is  a  negative  impact  on  the  environment  as  the  introduction  of 
stricter Stage IIIB compliant tractor is being delayed. 

According  to  information  from  industry,  Stage  IV  engines  are  considered  as  a  not  too 
different from Stage IIIB engines. Depending on the type of technology used, and in order to 
comply with the stricter NOx emissions limits in Stage IV engines, compared to those of Stage 
IIIB, 'minor' adaptations are expected by installing a more efficient anti-NOx after-treatment 
system.  Therefore  it  would  be  logical  to  assume  that,  in  order  to  diminish  R&D  and 
compliance  costs,  firms  might  try  to  accomplish  the  redesign  of  the  engines  as  soon  as 
possible and only once (from Stage IIIA to Stage IIIB covering as much as possible the needs 
for  Stage  IV)  instead  of  having  to  do  similar  adaptation  twice  (once  for  the  transition  from 
Stage  IIIA  to  Stage  IIIB  and  then  from  Stage  IIIB  to  Stage  IV).  This  is  the  only  option 
favoured by industry stakeholders. 

•  Option 4.4 - Increase of flexibility percentage to 80% 

This is similar to option 4.3, with the following differences: 80% would not be coherent with 
the  NRMM  proposal  (50%);  it  would  bring  maximum  alignment  with  the  US  market  while 
maintaining a fundamentally different system; the negative impact on the environment from 
this  option  would  be  larger  than  from  option  4.3.  Also,  industry  could  comply  with  the 
Directive with only 50% flexibility. 

•  Option 4.5 - Conditional use of the flexibility scheme, with penalty mechanism 

This option introduces the idea of a penalty for those industries that did not reach Stage IIIB 
compliance  in  time,  by  penalising  them  in  the  future.  However,  such  a  system  would  be 
difficult  and  costly  to  implement  and  enforce.  The  option  would  be  effective  regarding  the 
internal  market  and  environmental  objectives  if  the  optimal  level  of  the  penalty  could  be 
determined and is uniform across firms. Creating and implementing a penalty system would 
place  administrative  burden  on  MS.  Moreover  if  the  measure  was  to  be  harmonised  and 
implemented identically in all MS, additional costs would be involved at the EU level. It is 
therefore not considered to be efficient. It would be rather coherent with environmental and 
competition objectives and providing incentives to innovate, but due to the lack of data this 
option is not feasible. 

•  Option 4.6 - Implementation of trading system 

Here the market would decide whether or not firms would purchase additional flexibility or 
spend  the  money  on  R&D  to  reach  Stage  IIIB,  therefore,  optimising  the  trade-off  between 
economic development and environmental objectives. The system would be very complex to 
put into place in such a short time scale. The time taken to develop a working system would 
not be effective in meeting the immediate requirements of industry. If it were possible to set 
up  such  a  system  it  would  in  principle  be  effective  in  reaching  the  internal  market  and 
environmental objectives. Additional EU and national resources would be needed in order to 
put  the  trading  scheme  in  place.  However,  the  advantage  of  such  a  system  is  its  built-in 
mechanism  leading  to  efficient  avoidance  of  pollution  and  efficient  innovation.  This  option 
would be coherent with environmental and competition objectives and providing incentives to 
innovate. The time taken to develop a trading system would not be effective in meeting the 
immediate requirements of the industry. It is not feasible in the scope of a few years. 

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•  Option 4.7 - ABT scheme  

ABT is not considered to be a feasible option as described before; it was already turned down 
by Council and Parliament. 

Table 3: Comparison of the listed options:  

Effectiveness 

Efficiency 

Coherence 

Feasibility 

Option 1 –  

Not effective 

Not efficient 

Partly coherent 

Feasible  

Baseline 

Option 2 -  
Provision of government 
backed loans to finance 
stocking of IIIA engines 

Option 3 -  
National scrapping 
schemes 

Option 4.1 –  
Scaled Flexibility  

Option 4.2 –  
35% Flexibility  

Option 4.3 –  
50% Flexibility  

Option 4.4 –  
80% Flexibility  

Option 4.5 –  
Penalty mechanism 

Option 4.6 -  
Trading scheme 

Option 4.7 -  
ABT 

Partly Effective 

Not efficient 

Not coherent 

Feasible, if MS 
would be willing 

Partly effective 

Not efficient 

Partly coherent 

Unfeasible  

Effective 

Efficient 

Coherent 

Unfeasible 

Somewhat 
effective with 
respect to 
objective 1 

Not fully 
efficient 

Not coherent 
with NRMM 

Feasible 

Effective 

Efficient 

Coherent 

Feasible 

Effective only 
with respect to 
objective 1 

Not efficient 
due to 
environmental 
trade-off 

Not coherent 
with 
environmental 
policy 

Feasible 

Effective 

Not Efficient 

Coherent 

Unfeasible  

Effective  

Partly efficient 

Coherent 

Unfeasible  

Effective  

Partly efficient 

Coherent 

Unfeasible  

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6.6. 

Conclusion on preliminary Analysis  

As a result of the above analysis, it is concluded that extending the flexibility to 50% is the 
most appropriate measure to ensure that the objectives of the policy are met. The impacts of 
the preferred option will be assessed against the baseline in a quantitative way in section 7.1.  

7. 

IMPACTS OF PREFERRED OPTION  

The  environmental,  social  and  economic  impact  of  the  preferred  policy  option  will  be 
analysed in the following sections. 

All  contributions  provided  during  stakeholders  meetings  and  especially  during  the  public 
consultation for this proposal have been taken into account.  

The major cost categories that can be taken into account include: research and development 
costs,  variable  production  engine  costs,  tractor  redesign  costs,  after  treatment  devices  costs 
and fuel costs39. 

Environmental impacts have been determined based on external costs of calculated emissions. 
Emissions have been calculated taking into account tractor / engine stocks, average use and 
lifetime  of  tractors.40  These  environmental  costs  as  a  consequence  of  enlarged  flexibility 
should partly be compensated by the avoided costs of prolonged cost of using older tractors, 
but no figures are available. 

As the preferred option results in a proposal for a Directive amending Directive 2000/25/EC, 
to be approved by the co-legislators and then implemented by Member States, this procedure 
will take time. After submission by the Commission it could be adopted in 6 months; time to 
implement differs between Member States, from almost zero to 12 months. This means that 
the option would not be available yet in some MS as of the first deadline (for engines between 
130 and 560 kW), i.e. 1.1.2011. This is a serious drawback, but there is no other and better 
solution. On the other hand the remaining period of time, where industry would be able to use 
the proposed 50% flexibility would still be important for them and allow the recuperate some 
of the investments, which then can be used for further preparation for Stage IV. MS are aware 
of  the  problem  and  expect  an  amending  proposal  from  the  Commission.  They  will  do  what 
they can to help industry to overcome the problems by implementing the amending directive 
as  soon  as  possible.  Therefore  it  remains  to  be  hoped  that  following  the  Commission's 
adoption  of  the  revised  proposal,  MS  will  take  prompt  actions  to  transpose  the  amended 
Directive  so  that  the  manufacturers  could  benefit  from  the  revised  flexibility  as  soon  as 
possible.  

7.1. 

Environmental impact  

The  environmental  costs  represent  the  cost  generated  from  the  additional  emissions  of  the 
engines  under  the  amended  50%  flexibility  scheme  compared  to  the  current  20%  flexibility 

39 
40 

ARCADIS IA study page 28, point 0.10 
Same as footnote 40. 

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scheme.  As  mentioned  before,  the  additional  flexibility  has  the  impact  of  increasing  the 
availability of Stage IIIA by 16 weeks (see footnote 39).  

The overall impact from the additional amount of emissions is not expected to significantly 
affect  the  Member  States  obligations  under  the  CAFE  program.  Legislation  requires  MS  to 
meet certain ceilings for ambient air quality in defined geographical areas41.  

The effect on the environment will be even smaller than the one estimated in the Technical 
Review  due  to  the  impact  of  the  crisis  as  there  will  be  a  reduced  number  of  new  engines 
placed on the market than what was the basis of the calculation. An average drop of sales of at 
least  25%  up  to  60%  for  some  types  is  expected  (2009  vs.  2008).  This,  combined  with 
diminished  fuel  consumption  in  the  tractors  sector  may  lead  to  a  small  decrease  in  the 
emissions.  However,  an  exact  assessment  of  the  environmental  impact  of  placing  on  the 
market a smaller number of engines as a result of the economic crisis is not yet available and 
the environmental impacts may thus be overstated. 

As  the  tractors  are  rarely  used  in  problematic  and  highly  populated  areas  which  have  the 
highest local concentrations of pollutants, the overall impact from this additional amount of 
emissions is not expected to be significant. 

Emission  limits  as  set  by  Directive  2005/13/EC  are  around  30%  lower  for  NOx  and  around 
90%  lower42  for  PM  in  Stage  IIIB  than  in  the  Stage  IIIA.  The  environmental  impact  of  a 
modified  flexibility scheme  is  estimated under the assumption that all tractor manufacturers 
will use the full percentage of the flexibility scheme in the first year after the introduction of 
the  new  limits  of  Stage  IIIB.  This  assumption  is  based  on  the  information  available  to 
Commission  Services  via  the  notification  requirements  of  Directive  97/68/EC  on  the  use  of 
the flexibility scheme, for the transition from Stage II to Stage IIIA. They clearly indicate that 
the  total  allowance  of  tractor  manufacturers  to place  on  the  market  'flexed'  engines  was  not 
depleted  in  most  of  the  power  categories  (more  than  50%  was  still  available).  For  the  very 
small  power  engines  category  however,  the  total  allowance  is  used  almost  in  100%.  In  the 
case of 50% flexibility, from all new tractors (100%) placed on the market only 50% would 
comply  with  Stage  IIIB  emissions  limits,  while  the  remaining  50%  would  comply  with  the 
emission limits of Stage IIIA. 
Building on the 2005 figures43 for the NRMM sector, where the average share of emissions 
exhausted by new engines put on the market during one year accounts for around 5% of the 
total  emissions  of  NRMM,  while  the  remaining  95%  comes  from  the  engines  already 
operating on the market, we can assume that the situation looks similar in case of the tractors 
sector. 

The  amendment  of  flexibility  from  20%  to  50%  would  increase  the  emissions  of  newly 
produced  machinery  within  the  first  year  by  about  9%  compared  to  the  current  scheme. 
However, the overall machinery CI engine emissions would increase for the first year under 
the  50%  flexibility  by  around  0,3%  compared  to  the  current  20%  scheme.  In  absolute 
numbers the amounts of emissions can be quantified to about 0,66 kt for PM and 9,8 kt for 

41 
42 

43 

Directive 2008/50/EC L 152 11.6.2008 p1, Annex III 
More information on the reduction % of pollutants of the different stages of the Directive can be found 
in table 3. of Annex III.  
Summarised sales table of new tractor to be placed on the market and table of existing tractors, covered 
by the tractors Directive, are available in Annex V 

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33 

   EN 

                                                 
NOx per year for all NRMM. For tractors this is estimated to be about 0,3 kt for PM and 3,9 kt 
for NOx per year44. 
Comparative graphs presenting NOx and PM emissions for the current 20% and the proposed 
50% flexibility scheme can be found in Figure 1 and Figure 2. They were created for NRMM, 
but our best estimate is that the effect for tractors is very similar. 

Figure 1: Total NOx emissions for all CI engines in case of 20% flexibility and of 50% 
flexibility45 

44 
45

Based on JRC table 5.4 data of 26 kt PM and 515 kt NOx p.a. See Annex XII for further details. 
Environmental  costs  were  calculated  based  on  the  emission  model  for  CI  engines,  including 
assumptions  and  information  provided  by  industry  and  the  JRC  emissions  inventory,  as  described  in 
detail in Annex 7.8 of the IA study by ARCADIS. 

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34 

   EN 

 
                                                 
 
Figure  2:  Total  PM  emissions  for  all  CI  engines  in  case  of  20%  flexibility  and  of  50% 
flexibility 

The  conclusion  of  the  study,  according  to  the  methodology  based  on  the  Net  Present  Value 
(NPV), estimates, the environmental costs per type of pollutant of the following magnitude: 

Table 4: Environmental costs occurred during 2008 – 2030 (million Euros) 

Pollutant 

50% flexibility for all NRMM 

50% flexibility for tractors 

PM 

NOx 

Total

200 

350 

550 

80 – 90 

130 – 150 

210 - 240 

This  figure  represents  the  total  cost  over  the  period  of  2008-2030,  while  for  the  present 
Impact Assessment the benefit has been calculated for the period of three years as covered by 
the accompanying proposal. The figures for tractors are based on the assumption that tractors 
will still have the same relative share in pollution. 
The  estimated  impact  of  an  enlarged  flexibility  scheme  is  0,3%46  of  the  overall  emissions 
(both of PM and NOx) of all NRMM in use, in the first year. 

Impact on emissions of CO and HC is not discussed here since these factors are not important 
with  regard  to  diesel  engines;  Directive  2005/13/EC  did  not  introduce  a  reduction  in  those 
gases for that reason. The only change here is that HC must now be measured and approved 
separately from NOx whereas until now these were a combined factor. 

46 

JRC Technical Review page 98 (see footnote 10 on page 6) 

EN 

35 

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Concerning  CO2,  it  being  the  natural  product  of  burning  fossil  fuel,  the  emissions  from 
engines are currently not reported and therefore no estimate can be given on the impacts of 
increased flexibility or any other tentative measure reducing CO2 emissions. 

As  alternative  to  50%  flexibility,  a  possibility  to  postpone  the  introduction  of  Stage  IIIB 
might be considered until the introduction of Stage IV. The consequence of this would be that 
the effect of the 90% reduction in PM limits would be delayed for three years. 

The Commission is also of the opinion that a similar rise in flexibility for the introduction of 
Stage  IV  should  not  be  considered;  as  stated  before,  the  R&D  work  done  for  Stage  IIIB 
should guarantee that this would not be justified. The Commission will send a clear signal to 
the stakeholders about its firm intention to maintain the deadlines for Stage IV. 

7.2. 

Economic impact  

The main economic impact of the proposed measure are related to compliance costs which, as 
described  under  3.1,  include  mainly  research  and  development  costs  as  well  as  investment 
costs.  Despite  the  efforts,  it  was  possible  to  obtain  estimate  costs  of  R&D  from  only  one 
'integrated' manufacturer, who stated to have invested € 1,5 billion for R&D on Stage IIIB. As 
mentioned  before  both  the  external  contractor  (who  specified  a  long  list  of  efforts  in  his 
report) and DG ENTR have done considerable efforts to collect further data.  

Industry reported relative increases in R&D costs around the date of introduction of the new 
stages for NRMM. Some of the factors, not possible to be quantified due to lack of detailed 
information  and  therefore  not  taken  into  account,  include:  increased  learning  &  training; 
increased unavailability of manpower; increased stock piling; increased unavailability of low 
volume products; standstill state of the art; increased peak load certification bodies; increased 
warranty cost due to rush released. 

A simplified approach was used for NRMM to quantify the impact of the flexibility scheme 
enabling  the  reduction  of  R&D  costs  and  the  possibility  to  amortise  these  costs  over  an 
extended period of time. The assumptions and clarifications of this approach are as follows: 

Estimates  for  the  potential  relative  gains  in  R&D  budget,  provided  by  manufacturers  of 
agricultural  machinery,  due  to  the  increase  in  flexibility  for  the  typical  period  around  the 
introduction  of  new  emission  standards,  were  given  in  the  IA  Report  for  flexibility  for 
NRMM.  The  larger  the  flexibility  percentage  is,  the  lower  the  peak  costs  of  R&D  are 
expected in the same period of time. The same principle works for tractors. 

7.3. 

Impact on SMEs  

The  existing  flexibility  scheme  already  considers  the  need  to  protect  small  volume  tractor 
manufacturers  which  have  lower  resources  for  developing  new  technology  as  the  current 
system allows firms to either place a fixed number of tractors or a percentage of the previous 
stage on the market. The proposal, by scaling the fixed number by the same proportion as the 
percentage increase (2.5 times), maintains the logic of a system already preferred by SMEs.  

Data  concerning  possible  impacts  on  SMEs  are  drawn  from  the  impact  assessment  study 
carried  out  by  ARCADIS,  delivered  in  March  2010.  This  complementary  study  covers  the 
relevant  target  group  including  manufacturers  of  both  tractors  and  engines,  as  well  as 
professional users of the tractors. Information collected by the study suggests that compliance 

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36 

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costs, mainly R&D and conformity assessment costs will weigh relatively more upon SMEs 
(manufacturers).  Raising  the  necessary  capital  may  be  more  difficult  for  SMEs  which  also 
have  a  lesser  potential  for  cost  pass-through  compared  to  large  enterprises.  The  study  also 
indicated that only few tractor manufacturers and no engine manufacturers are SMEs and that 
the professional users are mainly very small entities.  

With the preferred option some SMEs (manufacturers) might be able to completely skip Stage 
IIIB, replacing in time their Stage IIIA tractor with a Stage IV model (because their 'normal' 
sales would not be more than the fixed number allowed). 

Without change, the SME / end-user may not be able to buy a new tractor, at least not from 
his regular source. As a consequence he will have to continue using his old tractor, which is 
(much)  more  polluting  than  the  IIIA  tractor  that  could  be  available  when  we  allow  50% 
flexibility. Alternatively he could buy a used, older tractor. 

The  old  tractor  will  be  more  costly  in  maintenance  and  fuel  consumption,  as  well  as  less 
efficient in performing the work. For maintenance, ARCADIS quotes in section 8.2.2 of the 
SME  report  figures  for  maintenance  of  older  special  (narrow-track)  tractors,  which  is  at  € 
1 339 million an order of magnitude higher than the additional environmental costs. 

7.4. 

Social impacts  

The 50% flexibility would probably allow (most) manufacturers not to close down production 
of certain lines as described under the baseline. This may avoid lay-offs. At present there is no 
information on how many of the present 24 000 jobs in the EU would be at risk. For SMEs it 
may  mean  not  closing  down  their  business.  Industry  should  have  less  problems  getting  the 
qualified  staff.  The  proposal  would  reduce  the  risk  for  the  end-user  not  to  be  able  to  buy  a 
new tractor from his regular source because that manufacturer would not be able to deliver a 
IIIB compliant tractor. As a consequence the number of old tractors, which are (much) more 
polluting,  costly  in  maintenance  and  less  safe  and  efficient  in  use  than  the  IIIA  tractor  that 
could be available when 50% flexibility would be allowed, would be reduced. 

7.5. 

Competition impacts 

The preferred option could have an impact on "first mover advantage" and innovation, which 
in turn could affect competition in this sector.  

As  for  "first  mover  advantage",  anecdotal  evidence  suggests  that  integrated  manufacturers 
might  be  the  first  to  have  a  Stage  IIIB  compliant  tractor  on  the  market.  An  integrated 
manufacturer  indeed  can  theoretically  and  to  some  extent  redesign  engine  and  tractor  in 
parallel.  By  contrast,  pure  tractor  manufacturers  have  to  wait  until  the  engine  manufacturer 
has completed the work on the engine and only then start redesigning their tractor. 

Under the baseline scenario, competition might be reduced in the long term. The tractors of 
first movers would be the only ones on the market - after every manufacturer has exhausted 
the  20%  flexibility.  From  that  point  onwards,  this  or  these  manufacturer(s)  would  enjoy  a 
monopolistic / oligopolistic position. Market competition would increase gradually each time 
another  manufacturer  has  IIIB  compliant  tractors  ready.  There  could  however  also  be  a 
permanent  reduction  in  competition  resulting  from  the  (permanent)  exit  of  a  number  of 
manufacturers unable to quickly present a IIIB tractor. Some of them are indeed probably not 

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37 

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able to survive an extended period without revenue (pm. no data are available to assess this 
risk, firms withholding information on their vulnerability for obvious reasons). 

Under the preferred option, competition would be preserved in the short and possibly also in 
the longer term, with a marginal impact on those manufacturers who may be ready to produce 
type IIIB tractor by the current legislative deadline. The Commission services have received 
confirmation that these manufacturers still support the request for more flexibility. 

On one hand, the preferred option would indeed allow more (non-integrated) manufacturers to 
remain  on  the  market  since  they  can  sell  tractors  over  a  somewhat  extended  period  of  time 
and use those revenues to finance the necessary redesign.  

On the other hand, manufacturers having made a major effort to comply with Stage IIIB by 
investing  upfront  into  R&D  would  still  benefit  from  this  investment  despite  having  to 
compete with possibly cheaper IIIA tractors for a limited period of time. In this sector, many 
elements  besides  price  determine  the  buying  decision  of  the  end  user.  Manufacturers  ready 
with Stage IIIB tractors would demonstrate their technological leadership which is commonly 
exploited for marketing purposes. First movers put quality and reputation effects at the heart 
of their branding strategy which in turn allow them to enjoy a price premium. The preferred 
option would therefore only have a marginal effect on first mover advantage.  

As for innovation, the impact of the preferred option is likely to be fairly limited in scope and 
in time. This option maintains the obligation for manufacturers to innovate. It simply provides 
with some additional time to find the required solutions. The more manufacturers remain in 
the market, the more innovative solutions can ultimately be expected. Moreover, the preferred 
option  is  more  stringent  that  the  approach  taken  by  US  regulators,  which  might  give  an 
innovative  advantage  to  EU  manufacturers  over  time.  Insofar  as  the  main  reasons 
underpinning  the  preferred  option  are  linked  to  exceptional  circumstances  (the  financial 
crisis),  there  should  be  no  significant  negative  impact  on  compliance  with  EU  rules  in  the 
future.  

Therefore the overall impact on competition and innovation, both in a static and in a dynamic 
view, appears to be relatively limited and would even be positive in the short term. 

7.6. 

Administrative burden 

The preferred option will not bring any major additional administrative burden. The necessary 
reporting requirement is already present in Directive 2000/25/EC. 

7.7. 

Effect of the proposed measure compared to the base line 

Although the use of the flexibility scheme generates a negative environmental impact (partly 
compensated because less older, polluting tractors would remain in use), it offers a benefit for 
the  manufacturer  when  it  comes  to  the  compliance  cost  including  a  decrease  in  peak  R&D 
investments costs, since these costs are spread over a longer period, and less problems to get 
qualified staff. Additional flexibility would also mean less risk of lay-offs and better prospects 
for the end-user. 

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8.  MONITORING AND EVALUATION 

An  assessment  of  the  impacts  of  the  enlarged  provisions  of  the  flexibility  scheme  after  its 
implementation and completion will be based on information provided by the industry and by 
Member States. 

Key indicators to assess the effectiveness of this initiative could be the use of the flexibility 
scheme until end of 2013, the development of the number of firms going out of business, and 
the development of NOx and PM emissions attributed to tractors. 

Directive  2000/25/EC,  Annex  IV,  requires  the  tractor  manufacturer  under  the  arrangements 
for the flexibility scheme to notify all relevant data concerning the application of the scheme 
including inter alia the cumulative data on the number of engines placed on the market under 
the flexibility scheme. Thus, no increase in costs for manufacturers or national authorities is 
expected. 

It  is  the  Commission’s  intention  to  evaluate  the  impact  of  the  revised  flexibility  measure  at 
the  end  of  the  period  defined  in  the  accompanying  proposal,  i.e.  in  2014  and  to  draw  the 
necessary conclusions from the results obtained.  

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ABT 

Averaging, Banking and Trading system (USA) 

ANNEX I: Glossary 

Adsorption 

the accumulation of atoms or molecules on the surface of a material 

Engine family 

a manufacturer's grouping of engines which, through their design, are 
expected  to  have  similar  exhaust  emission  characteristics  and  which 
comply with the requirements of Directive 2000/25/EC 

CECE 

CEMA 

C.I. 

CO 

DPF 

EGR 

Committee for European Construction Equipment 

Committee for European Agricultural Tractor Manufacturers 

An  engine  that  works  under  the  compression-ignition  principle,  e.g. 
diesel engine 

Carbon monoxide  

Diesel Particulate Filter 

Exhaust Gas Recirculation 

Engine 
manufacturer 

the person or body who is responsible to the approval authority for all 
aspects  of  the  type-approval  process  and  for  ensuring  conformity  of 
production of the engines 

HC 

NOx 

NRMM 

NTT 

Hydrocarbons 

Nitrogen oxides (NO, NO2, N2O) 

non-road mobile machinery (emissions directive 97/68/EC) 

narrow-track  tractors  (categories  defined  in  Directive  2003/37/EC  as 
T2, C2 and T4.1, the width of which is less than 1,15 m) 

PM 

Particulate Matter 

UNECE 

United Nations Economic Commission for Europe (Geneva) 

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40 

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ANNEX II: Reference Documents 

Final Report Technical Review - DG JRC - 28-11-2008 

Administrative  arrangement  for  a  Technical  Review  of  Directive  97/68/EC,  carried  out  by  DG 
JRC, on behalf of DG ENTR, September 2006 - September 2008. 

http://ec.europa.eu/enterprise/newsroom/cf/document.cfm?action=display&doc_id=5015&userservice_id=
1&request.id=0 

Final Report of the IA study - ARCADIS - January 2009 

External specific contract, under LOT5 framework contract, for an Impact Assessment study of 
options  presented  in  the  Technical  Review  of  Directive  97/68/EC,  carried  out  be  ARCADIS 
N.V., April 2008 - January 2009. 

http://ec.europa.eu/enterprise/newsroom/cf/document.cfm?action=display&doc_id=5028&userservice_id=
1&request.id=0 

Final  Report  of  the  SME  Test  Study  and  IA  on  possible  options  for  reviewing  of  the 
Directive 97/68/EC relating to NRMM - ARCADIS - March 2010 

Additional external specific contract, under LOT5 framework contract, for an SME Test study, 
carried out be ARCADIS N.V., 2009 - March 2010. 

a.eu/enterprise/newsroom/cf/newsbytheme.cfm?displayType=library&tpa_id=163&lang=en 

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41 

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ANNEX III: Summarized Stages table of Directive 2000/25/EC 

1. STAGE I (ENGINE CATEGORIES A, B, C)  

cat 

power range (kW) 

tractors - TA 

tractors – all new 

A 

B 

C 

130 ≤ P ≤ 560 

30-06-2001 

75 ≤ P < 130 

31-12-2000 

30-06-2001 

37 ≤ P < 75  

31-12-2000 

30-06-2001 

2. STAGE II (ENGINE CATEGORIES: D, E, F, G) 

cat 

power range (kW) 

tractors - TA 

tractors – all new 

D 

E 

F 

G 

18 ≤ P < 37  

31-12-2000 

31-12-2001 

130 ≤ P ≤ 560  

31-12-2000 

31-12-2001 

75 ≤ P < 130  

31-12-2001 

31-12-2002 

37 ≤ P < 75  

31-12-2002 

31-12-2003 

3. STAGE IIIA (ENGINE CATEGORIES H, I, J, K) 

cat 

power range (kW) 

tractors - TA 

tractors – all new 

H 

I 

J 

K 

130 ≤ P ≤ 560  

31-12-2005 

31-12-2005 

75 ≤ P < 130  

31-12-2005 

31-12-2006 

37 ≤ P < 75  

31-12-2006 

31-12-2007 

19 ≤ P < 37 

31-12-2005 

31-12-2006 

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4. STAGE III B (ENGINE CATEGORIES L, M, N and P) 

cat 

power range (kW) 

tractors - TA 

tractors – all new 

L 

M 

N 

P 

130 ≤ P ≤ 560  

31-12-2009 

31-12-2010 

75 ≤ P < 130  

31-12-2010 

31-12-2011 

56 ≤ P < 75  

31-12-2010 

31-12-2011 

37 ≤ P < 56 

31-12-2011 

31-12-2012 

5. STAGE IV (ENGINE CATEGORIES Q and R) 

cat 

power range (kW) 

tractors - TA 

tractors – all new 

Q 

R 

130 ≤ P ≤ 560  

31-12-2012 

31-12-2013 

56 ≤ P < 130  

30-09-2013 

30-09-2014 

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Power 

(kW) 

Type-
approval 

130 / 560 

2009 

2010 

2011 

2012 

2013 

2014 

2015 

2016 

Year 

H 

L 

Q 

CO: 3,5; HC+NOx: 4,0;  

PM: 0,2 

CO: 3,5; HC: 0,19; NOx: 2,0; 
PM: 0,025 

CO: 3,5; HC: 0,19; NOx: 0,4; 
PM: 0,025 

Type-
approval 

I 

75 / 130 

CO: 5,0; HC+NOx: 4,0; PM: 0,3 

M 

R 

CO: 5,0; HC: 0,19;  

NOx: 3,3; PM: 0,025 

CO: 5,0; HC: 0,19; 
NOx: 0,4; PM: 0,025 

Type-
approval 

J 

56 / 75 

CO: 5,0; HC+NOx: 4,7; PM: 0,4 

N 

R 

CO: 5,0; HC: 0,19;  

NOx: 3,3; PM: 0,025 

CO: 5,0; HC: 0,19; 
NOx: 0,4; PM: 0,025 

Type-
approval 

37 / 56 

Type-
approval 

19 / 37 

J 

P 

CO: 5,0; HC+NOx: 4,7; PM: 0,4 

CO: 5,0; HC+NOx: 4,7; PM: 0,025 

K 

CO: 5,5; HC+NOx: 7,5; PM: 0,6 

2009 

2010 

2011

2012 2013   

2014   

2015 

2016

Stage 
IIIA 

Stage 
IIIB 

limit values: gr/kWh 

Stage 

IV 

CO = carbon monoxide; HC = hydrocarbons; NOx = nitrogen oxides; PM = particulate matter. 

Letters H to R refer to the combination of engine power category and emissions stage, as specified before in this annex. 

EN 

44 

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Percentage reductions for different engine categories are: 

NOx: IIIA (cid:198) IIIB 

NOx: IIIB (cid:198) IV 

PM: IIIA (cid:198) IIIB 

PM: IIIB (cid:198) IV 

130 – 560 kW 

H (cid:198) L: HC+NOx=4,0 
(cid:198) HC+NOx=2,19; 47 % 

L (cid:198) Q:  
2,0 (cid:198) 0,4 = 80 % 

H (cid:198) L:  
0,2 (cid:198) 0,025 = 88 % 

L (cid:198) Q:  
0,025 (cid:198) 0,025 = 0 % 

75 – 130 kW 

I (cid:198) M: HC+NOx=4,0 (cid:198) 
HC+NOx=3,49; 13 %  

M (cid:198) R:  
3,3 (cid:198) 0,4 = 86 % 

I (cid:198) M:  
0,3 (cid:198) 0,025 = 92 %  

M (cid:198) R:  
0,025 (cid:198) 0,025 = 0 % 

56 – 75 kW 

J (cid:198) N: HC+NOx=4,7 (cid:198) 
HC+NOx=3,49; 27 % 

N (cid:198) R:  
3,3 (cid:198) 0,4 = 86 % 

J (cid:198) N:  
0,4 (cid:198) 0,025 = 94 % 

N (cid:198) R:  
0,025 (cid:198) 0,025 = 0 % 

37 – 56 kW 

J –> P: HC+NOx=4,7 (cid:198) 
no change 

No Stage IV 

J –> P:  
0,4 (cid:198) 0,025 = 94 %  

No Stage IV 

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ANNEX IV: Flexibility scheme, fixed numbers and ABT 

1. 

Flexibility 

As  provided  in  Article  3A  and  in  Annex  IV  of  Directive  2000/25/EC,  any  tractor 
manufacturer that wishes to make use of the flexibility scheme shall request permission from 
an approval authority to purchase from his engine suppliers, in the period of a new emission 
stage, the quantities of engines that do not comply with the current emission limit values, but 
are approved to the nearest previous stage of emission limits. 

The flexibility scheme applies to tractors with compression ignition engines (e.g. diesel) with 
a power from 19 kW to 560 kW. 

The number of tractors placed on the market under a flexibility scheme shall, in each engine 
category, not exceed 20% of the tractor manufacturer's annual sales of tractor with engines in 
that engine category (calculated as the average of the latest 5 years sales on the EU market). 
Where  a  tractor  manufacturer  has  marketed  tractors  in  the  EU  for  a  period  of  less  than  5 
years, the average will be calculated based on the period for which the tractor manufacturer 
has marketed tractors in the EU. 

As an alternative the tractor manufacturer may seek permission to place on the market a fixed 
number  of  tractors  under  the  flexibility  scheme.  The  number  of  tractors  in  each  engine 
category shall not exceed the following values: 

Engine Category (kW) 

Number of engines 

19-37 

37-75 

75-130 

130-560 

200 

150 

100 

50 

The  fixed  number  of  engines  scheme  is  intended  for  very  small  producers  that  would 
otherwise not be able to effectively use the scheme. 

Any tractor manufacturer may apply to the type approval authority of a Member State to be 
allowed to use the provisions of the flexibility scheme for each engine power category. The 
placing on the market of tractors (with new engines) under the scheme can be spread over the 
duration of the next 'cleaner' stage, in different ways, provided the total allowance of 20% of 
sales per power category is not exceeded. (ex. for the duration of Stage IIIA - 5 years for the 
power category of 130-560 kW - the 20% can be all used in the 1st year, or 10% in the first 
year 10% in the second, 0% in the 3rd, 4th and 5th, or 10% in the first, 5% in 2nd and 5% in 3rd, 
0% in 4th and 5th, etc.), according to the needs and business plan of the tractor manufacturer. 

The  tractor  manufacturer  may  also  choose  for  tractors  with  engines  of  one  engine  power 
category to apply the percentage of sales of the previous year and for another engine power 

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category to use the fixed engines number as mentioned in the  relevant table; he cannot use 
both options in the same power category. 

The  number  of  tractors  allowed  to  be  placed  on  the  market  under  the  maximum  20%  per 
power category, is calculated as the average of sales of the tractors placed on the market in 
EU  for  the  previous  5  years,  counting  back  from  the  day  of  the  application  to  the  type 
approval  authority  of  a  Member  State  for  using  the  flexibility  scheme.  If  the  tractor 
manufacturer  has  not  been  in  business  for  5  years,  then  the  average  is  calculated  for  the 
period that the tractor manufacturer is in business. 

As  a  result,  after  the  approval  of  using  the  flexibility  scheme,  the  number  of  tractors  to  be 
placed on the market under the flexibility scheme remains the same and is not recalculated as 
years pass by in the 'cleaner' stage. 

The main advantage of the scheme is that the sooner the application for using the flexibility 
scheme is granted, the bigger numbers of tractor may be placed on the market, especially in 
times where technical changes must be implemented or like the present situation when under 
the pressure of the economic crisis, sales are dropping. 

The  tractor  manufacturer  cannot  transfer  part  or  the  total  of  his  flexibility  allowance  to 
another tractor manufacturer or from one power category to the other. 

The provisions of the flexibility scheme are allocated to power categories of the used engines, 
regardless of the number of engine families47 type approved in that category.  

It  must  be  noted  that  as  a  result  of  the  way  that  the  flexibility  scheme  is  implemented,  all 
environmental  impacts  remain  the  same  in  total,  regardless  of  the  time  of  the  placing  of 
engines on the market, since the total allowance of 20% per power category is respected. 

The  application  for  the  use  of  the  flexibility  scheme  may  be  delivered  to  only  one  type 
approval  authority  of  any  Member  State  in  the  EU.  The  provisions  of  the  scheme  make  it 
very  clear  that  the  type  approval  authorities  of  one  Member  State  disseminate  to  other 
Member  states  information  on  granting  approvals  for  tractor  being  placed  on  the  market 
under the flexibility scheme. As a result, the tractor manufacturer cannot apply for the use of 
the flexibility scheme to more than one Member States. 

2. 

Fixed engines numbers of the flexibility scheme  

Table 1- Fixed number of engines under the current flexibility scheme up to Stage IIIA 

ENGINE CATEGORY (kW) 

NUMBER OF ENGINES 
(flexibility at 20%) 

19-37 

37-75 

200 

150 

47 

Engine family: a manufacturer's grouping of engines which, through their design, are expected to have 
similar exhaust emission characteristics and which comply with the requirements of the Directive, as in 
Annex I. 

EN 

47 

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75-130 

130-560 

100 

50 

The classification of engines differs in Stage IIIB, compared to the classification of engines 
up  to  Stage  IIIA.  Power  category  of  19-37  kW  is  not  included  any  more  in  the  flexibility 
scheme, and power category 37-75 kW is split in two separate categories of 37-56 kW and 
56-75 kW. The total of engines in these two categories (80+70) as in Table 2, equal the total 
of the 37-75 kW. 

Table 2 - Calculation of fixed number of engines under the proposed amended flexibility 

(1) 

(2) 

(3) 

ENGINE CATEGORY (kW) 

Number of engines under 
flexibility scheme of 20% 

Final number of engines – 
50% (Figures in (2) 
multiplied by 2.5) 

37-56 

56-75 

75-130 

130-560 

80 

70 

100 

50 

200 

175 

250 

125 

Table 3 - Calculation of fixed number of engines under amended flexibility: 35% and 80% 

(1) 

(4) 

(5) 

ENGINE CATEGORY (kW) 

Final number of engines 
under flexibility scheme of 
35% 

Final number of engines 
under flexibility scheme of 
80%  

37-56 

56-75 

75-130 

EN 

140 

123 

175 

48 

320 

280 

400 

   EN 

 
 
130-560 

88 

200 

3. 

ABT 

The Averaging, Banking and Trading system, originally introduced before 2000, is built on 
the three pillars of  
- Averaging i.e. exchange of credits between engine families of a given engine manufacturer 
for a specific model year,  
- Banking i.e. the retention of credits by one engine manufacturer for use in future years, and  
- Trading i.e. exchange of credits between engine manufacturers.  

The  ABT  system  on  exhaust  emissions  used  in  the  USA  allows  an  engine  manufacturer  to 
produce individual products of 'cleaner' and 'dirtier' lines and place both types on the market, 
provided  that  the  average  emissions  of  the  manufacturer's  fleet  comply  with  the  legislated 
limits. A precise method, allocating points, is used in order to calculate the emissions from 
both engine types. In the same legislation an emissions cap is foreseen, as a higher limit that 
must be met by all individual products. Strict rules on the implementation and compliance of 
the engines placed on the market by the manufacturer followed by strict penalties in case of 
no compliance are set in the regulation. 

The  ABT  system  is  addressed  to  engine  manufacturers.  In  addition  the  USA  operates  a 
'flexibility'  system  which  is  addressed  to  (machinery  and)  tractor  manufacturers,  allowing 
sales of tractors complying with the earlier 'Tier' for 7 years. 

In the EU an ABT system was proposed when the amendments to Directive 2002/88/EC were 
discussed.  This  idea  was  rejected  by  Member  States  and  Parliament  because  it  was  too 
complex for implementation in the legislation of MS and too difficult to monitor. In addition 
it  would  not  work  for  smaller  manufacturers.  To  be  noted  that  ABT  would  bring  serious 
administrative  burden  to  manufacturers,  who  have  to  predict  their  production  in  different 
engine  families  before  the  year  (numbers,  engine  emissions  performance  etc)  and  calculate 
the  outcome  at  the  end  of  the  year,  keeping  records  of  all  shipments.  National  authorities 
would have to check these. 

Advantages of ABT would be that manufacturers that are quick with their new products can 
build up credits, to be used to compensate for their engine types that are not yet compliant, or 
can be sold to competitors that are slower. Also, use of an ABT system might allow an earlier 
introduction of new requirements.  

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ANNEX V: Positions of stakeholders regarding the amendment of the provisions of the 
flexibility scheme for NNRM and tractors 

01-06-2007 

United 
Machinery 
Equipment 
CECE 

- 

Industry Association 

Proposing:  an  enlargement  of  flexibility  to 
better align with the US. 

03-06-09 

CEMA /CECE 

Industry Associations  Letter with supporting evidence for the request 

16-06-2009 

WIRTGEN 
GROUP 

Road and mineral 
Technologies 

29-06-2009 

German 
Federal 
Ministry 
Environment 

of 

30-6-2009 

Department  of 
Transport, UK 

30-06-2009 

FEM 

01-07-2009 

EUROMOT 

02-07-2009 

EEB 

Federation of 
European Materials 
Handling 

The European 
Association of 
Internal Combustion 
Engine 
Manufacturers 

European 
Environmental 
Bureau 

03-02-2009 

CEA 

Construction 
Equipment 
Association (UK) 

for extended flexibility for tractors. 

Supports  an  increase  of  flexibility  up  to  50% 
and  a  relevant  increase  of  the  fixed  numbers 
table, proposes the extension of implementation 
date of Stage IIIB be 2 years and Stage IV by 3 
years  and  emphasises  on  the  need  to  adopt  a 
positive  statement  on  these  issues  by  October 
2009. 

Expresses doubts on the extent of the economic 
crisis  of  the  NRMM  sectors,  concerns  on  the 
the  presented  environmental 
analysis  of 
impacts,  concerns  over  the  rise  of  the  PM 
concentration.  Proposes 
to  address  an 
enlargement of flexibility, linked to limit values, 
in the full revision of the Directive.  

Welcomes the proposal to amend flexibility 

Really appreciates the amendment of flexibility. 

Fully support the flexibility amendment 

Express concerns on the flexibility amendment, 
on  the  ability  of  MS  to  comply  with  National 
emission ceilings, on possible delay of placing 
on the market of Stage IIIB compliant engines, 
on  competitiveness  issues  within  industry  and 
on the reliability of the EU policies as a total.  

Strongly endorses the proposal 

March 2-009 

ORGALIME 

Industry Association  Meeting  with  VP  Verheugen  to  support  the 
proposal for tractors. 

09-07-2009 

JCB 

Construction 
Equipment 
Manufacturer 

Strongly endorses the proposal. 

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10-07-2009 

SMMT 

Strongly endorses the proposal  

The Society of Motor 
Manufacturers and 
Traders (UK) off 
Highway Engine & 
Equipment Group  

13-07-2009 

AGORIA 

Belgium Employers 
Organisation 

Fully  support  the  proposal,  asks  for  a  similar 
measure to be proposed for tractors. 

14-07-2009 

CEMA 

Industry Association 

14-07-2009 

AECC 

Association for 
Emissions Control by 
Catalyst 

Letter to VP Verheugen asking for progress on 
the dossier for tractors. 

Supports  additional  measures  acting  as 
incentives  for  Stage  IIIB  engines  to  be  placed 
on  the  market  but  not  the  proposed  measure. 
Justifications  include  impacts  on  environment, 
EU competiveness in the global market. 

15-07-2009 

WKO 

Austrian Vehicle 
Industry Association 

Supports the proposal. 

16-07-2009 

CLAAS 

Agricultural 
Equipment 
Manufacturer 

Appreciates  the  proposal  to  amend  flexibility 
and  proposes  the  implementation  of  a  similar 
measure for tractors. 

In  GEME  discussions  focussed  on  NRMM  but  did  include  the  possibility  to  also  enlarge 
flexibility for tractors (and the exemption for narrow-track tractors). On 17-7-2009 the Italian 
representative insisted that the Commission should include tractors in its proposal to enlarge 
flexibility. 

To  summarize  the  comments  received  from  the  consultation:  a  majority  of  comments  were 
submitted  by  industry  federations  and  individual  manufacturing  or  user  companies.  These 
underlined  the  benefit  from  increasing  the  flexibility  which  would  allow  companies  to 
distribute the required compliance costs more evenly over time during the crisis and ensure a 
relative income that would allow performing the necessary extensive changes in various types 
of products (engines and vehicles) over a longer period of time. Only one company stated that 
new emission standards could only be achieved with low-sulphur fuels which would not be 
available  world-wide,  meaning  that  export  oriented  tractor  manufacturers  would  be 
compelled  to  produce  two  different  sets  of  tractors,  one  for  the  countries  that  have  similar 
stringent emission limits (EU, USA, Japan) and another for the rest of the world. 

The  international  organisation  of  catalyst  and  filter  based  technology  (AECC)  drew  the 
attention to the need to align the production of engines to emission standards in the USA and 
in  Japan  and  concluded  that  any  delay  in  the  introduction  of  EU  emission  standards  would 
jeopardise the benefits for the whole manufacturing industry, in particular with regard to the 
'first  mover'  benefits.  It  also  highlighted  that  the  increased  flexibility  would  delay  the 
recoupment of development costs. 

One  environmental  NGO  submitted  comments  and  referred  to  the  recent  statement  of  the 
European  Environmental  Agency  on  the  impact  of  particle  pollution,  mainly  emitted  from 
diesel engines and expressed its concern that the increased flexibility could trigger lobbying 
for the delay of other environmental measures. 

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One national employer's organisation expressed its full support to the Commission's initiative 
on extending the flexibility scheme, and identified numerous merits of this approach. 

One Member State drew the attention to the need to carefully assess the possible impact of 
the measure on the environment, in particular in the context of Member State obligations to 
meet  the  ambient  air  quality  standards.  Another  Member  State  welcomed  the  proposed 
measure. No Member State objected. 

The issue of wider flexibility for tractors was also discussed with all relevant stakeholders in 
the  Commission's  Working  Group  on  Agricultural  Tractors  (WGAT)  on  22  June  and  18 
December 2009. Apart from general support for wider flexibility expressed by some MS and 
CEMA / EUROMOT no further comments were made in those meetings. 

In the Commission's Motor Vehicles Working Group on 26-1-10 the proposed work program 
was  discussed  with  all  stakeholders,  which  included  the  present  issue  of  amending  the 
flexibility  scheme  for  tractors.  No  objections  were  raised  against  this  approach  of  allowing 
more flexibility. 

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ANNEX VI: Fleet and annual sales of tractors 

Table 1: Annual sales estimates per tractor category and power class (year 2005, EU15) 

Power 
(kW) 

< 19 

19-37 

37-56 

56-75 

75-130 

130-560  > 560 

average 

9,5 

28 

46,5 

65,5 

102,5 

345 

800 

Agricultural 
tractors 

163 000 

14 670 

3 260 

32 600 

48 900 

48 900 

14 670 

0 

Percentage 

10,8 

2,0 

20,0 

30,0 

30,0 

9,0 

0 

Table 2: Total number of tractors in use per tractor category and power class  

(overall NRMM: 6,7 million; year 2005, EU15) 

Total  engines 
on market 

Total Nr 

< 19 

19-37 

37-56 

56-75 

75-130 

130-
560 

> 560 

9,5 

28 

46,5 

65,5 

102,5 

345 

800 

Agricultural 
tractors 

2 500 
420 

146 700 

32 600 

521 
600 

782 
400 

782 
400 

234 
720 

Percentage 

5,9 

1,3 

20,9 

31,3 

31,3 

9,4 

0 

0 

Source: JRC 

Table 3: Western European tractors market 2007 – Q1 2010 (EU15) 

2007 

2008 

2009 

Q1 2010 

Change 
(Q1 2010 - Q1 2009) 

Agricultural 
tractors 

165 83 

173 615 

150 083 

30 387 

-22% 

Source: CEMA, June 2010 

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ANNEX VII: Emissions of NOx and PM 

Table 1: NOx and PM emissions per tractor category and power class  

NOx emissions (kt) 

power 

< 19 

19-37 

37-56 

56-75 

75-130 

130-
560 

> 560 

Total  

9,5 

28 

46,5 

65,5 

102,5 

345 

800 

Agricultural 
tractors 

0,86 

0,99 

36 

107 

185 

185 

Percentage 

0,17 

0,19 

7,0 

20,8 

35,9 

35,9 

515 

0 

0 

PM emissions (kt) 

power 

< 19 

19-37 

37-56 

56-75 

75-130 

130-
560 

> 560 

Total  

9,5 

28 

46,5 

65,5 

102,5 

345 

800 

Agricultural 
tractors 

0,12 

0,11 

2,55 

7,55 

8,58 

7,58 

Percentage 

0,5 

0,5 

9,8 

29,0 

33,0 

29,1 

26 

0 

0 

Overall: 

1281 kt NOx 

71 kt PM 

Agri. + Constr.:  

605+593= 1098 kt NOx 

30+29= 59 kt PM 

RAINS (Agri. + Constr.): 

539+248 = 787 kt NOx 

57+23= 80 kt PM  

Source: JRC 

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ANNEX VIII: Market of agricultural vehicles 

1. 

Number of tractors sold in 2001, 2004, 2005, average prices and turnovers  

Number sold (units) 

Average price (€) 

Turnover (€ million) 

Tractor 
category 

2001 
(EU12) 

2004 

2005 
(EU25) 

2001 

2004 

2005 

2001 

2004 

2005 

(EU12) 

(EU25) 

(EU12) 

(EU25) 

T1 

T2 

T3 

T4 

T4.1 

T4.2 

T4.3 

T5 

C 

120 000 

15 000 

1 650 

15 000 

13 000 

5000 

100 000 - 
150 000 

100 000- 
150 000 

1,3 – 2 

Total 

154 000 

156 200   169 650 

40 130 

46 700 

6 180  

7 300  

 8 000 

(2005 figures based on TRL final report, 2009, p. 73; 2001 and 2004 figures based on CEMA information) 

2. Definition of tractor categories 48 

1. Category T: Wheeled tractors 

– 

48 

49 

Category  T1:  wheeled  tractors  with  a  maximum  design  speed  of  not  more  than  40  km/h, 
with  the  closest  axle  to  the  driver49  having  a  minimum  track  width  of  not  less  than 
1 150 mm, with an unladen mass, in running order, of more than 600 kg, and with a ground 
clearance of not more than 1 000 mm. 

Directive 2003/37/EC and TRL Study: 
http://ec.europa.eu/enterprise/newsroom/cf/document.cfm?action=display&doc_id=4501&userservice_
id=1&request.id=0 
For  reversible  driver's  position  tractors  (reversible  seat  and  steering  wheel),  the  closest  axle  to  the 
driver to be considered must be the one fitted with the biggest diameter tyres. 

EN 

55 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
– 

– 

– 

– 

– 

– 

– 

Category T2:  wheeled  tractors  with  a  maximum  design  speed  of  not  more  than  40 km/h, 
with a minimum track width of less than 1 150 mm, with an unladen mass, in running order, 
of  more  than  600 kg  and  with  a  ground  clearance  of  not  more  than  600 mm.  However, 
where the height of the centre of gravity of the tractor50 (measured in relation to the ground) 
divided  by  the  average  minimum  track  for  each  axle  exceeds  0,90,  the  maximum  design 
speed is restricted to 30 km/h. 

Category T3: wheeled tractors with a maximum design speed of not more than 40 km/h, and 
with an unladen mass, in running order, of not more than 600 kg. 

Category T4:  special  purpose  wheeled  tractors  with  a  maximum  design  speed  of  not  more 
than 40 km/h (as defined in Appendix 1). 

Category  T4.1:  high-clearance  tractors  mainly  used  in  France  and  with  a  small  number  of 
manufacturers; 

Category T4.2: very large tractors; 

Category T4.3: alpine tractors with a low centre of gravity to allow them to work on steep 
inclines. 

Category T5: wheeled tractors with a maximum design speed of more than 40 km/h. 

2. Category C: Track – laying tractors 

Track – laying tractors that are propelled and steered by endless tracks and whose categories 
C1 to C5 are defined by analogy with categories T1 to T5. 

50 

In accordance with standard ISO 789-6: 1982. 

EN 

56 

   EN 

                                                 
Tractors - new registrations per MS, 2006 – 2008  

3. 
(source: TRL final report 2009). 

Registrations 

2006 

2007 

2008 

Austria 

Belgium 

Bulgaria 

Cyprus 

Czech Republic 

Denmark 

Estonia 

Finland 

France 

Germany 

Greece 

Hungary 

Ireland 

Italy 

Latvia 

Lithuania 

Luxembourg 

Malta 

Netherlands 

Poland 

Portugal 

Romania 

Slovakia 

Slovenia 

Spain 

Sweden 

United Kingdom 

7 152 

2 748 

6 792

2 680

7 737

2 225 

3 110 

4 172 

27 388 

29 009 

3 518 

1 045 

4 221 

2 730

3 479

4 245

29 129

28 469

4 170

2 045

29 752 

26 837

3 823 

4 054

5 415 

6 122

1 853 

16 605 

4 233 

13 829 

2 084

17 241

4 465

14 941

437

1 077

1 450

Total 

160 098 

159 483

10 701

(Empty boxes: no information was received) 

EN 

57 

   EN 

 
 
 
 
 
 
 
 
 
 
 
4. Import/export of new agricultural tractors, 2007, EU27 (Comext database) 51 

Track-laying tractors  

Wheeled agricultural tractors 

Import 

Impor
t 

Export 

Expor
t 

Import 

Import 

Export 

 Export 

Value 

Units 

Value 

Units 

Value 

Units 

Value 

Units 

Belarus 

95.038.622

7.378 

12.964.865

95

Canada 

200.412 

9   

2.677.990

295 

62.964.860

2.328

Chile 

China 

Croatia 

Iceland 

Iran 

Israel 

Japan 

Malaysia 

Mexico 

Morocco 

137.999

7  

11.756.464

130.670 

25 

114.480

5  

25.851.834

8.488 

10.044.776

706

283

96.146

40.539

4  

8  

450.727

13 

34.752.302

1.160

15.522.714

17.239.503

422

514

505

32.256 

2   

15.063

4 

11.423.125

439.696 

206   

147.060.521

25.068 

45.213.966

1.183

6.269.559

213.457

28 

9.413.104

455

454

198.088

21  

28.016.583

1.747

New Zealand 

16.205

1  

8.135

1 

61.428.357

1.874

Norway 

438.338 

29 

599.060

60  

1.626.906

93 

154.734.409

5.354

Russia 

287.813 

8 

6.981.647

170  

151.558

20 

72.359.710

1.370

Serbia 

17.439 

1 

151.341

4  

511.653

38 

17.239.770

413

South Africa 

3.463.204

34  

166.840

41 

71.097.548

2.829

51 

Values in Euros and units 

EN 

58 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
South Korea 

20.661.795

2.248 

36.586.678

1.200

Switzerland 

580.763 

28 

416.682

16  

7.732.927

210 

93.881.975

2.921

Tunisia 

9.230.970

585

Turkey 

4.482.968 

1.467 

246.126

2  

9.754.638

621 

67.533.886

3.060

Ukraine 

3.181.355

26  

469.873

52 

25.702.010

358

United States 

37.641.319 

368 

2.082.490

188  

476.626.178

42.049 

742.673.712

25.882

Venezuela 

8.000 

1 

336.321

12  

7.440.827

280

Total 

44.259.674 

2.144  18.061.683

558  

789.018.717 

86.647 

1.625.491.673

55.978

EN 

59 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ANNEX IX: the SME Test (ARCADIS report 30-03-2010) 

(1) Consultation with SMEs representatives  See  sections  3.2,  3.4,  3.5,  Table  1  and  7:  little 

response; 2 case studies. 

Representatives  of  manufacturers  and  suppliers 
as  well  as  end-users  were  contacted  with 
enquiries, meetings and phone calls, as listed in 
the study. 

(2)  Preliminary  assessment  of  businesses 
likely to be affected 

See  sections  3  and  7:  few  manufacturers  but 
some specialised firms (T4.1 etc.); most (or all) 
end-users. 

(3) Measurement of the impact on SMEs 

See  section  7.  Few  replies  available.  One 
manufacturer  indicates  30%  price  rise  for  new 
IIIB  engines  and  huge  price  (€  5  000)  and  time 
(delay up to one year) problems because with the 
new  engine  the  tractors  (otherwise  unchanged) 
needs new national homologation, to be avoided 
with enlarged flexibility. 

(4) Assess alternative options and mitigating 
measures 

See section 7.4: 50% flexibility would solve the 
problems for SME manufacturers. 

As  alternative  an  "extension  of  the  duration"  of 
seems 
flexibility 
unacceptable. 

is  mentioned,  but 

this 

. 

EN 

60 

   EN 

 
ANNEX X: Comparison of the options  

Effectiveness 

Efficiency 

Coherence 

Feasibility/additional 
comments 

Option 1 - 
Baseline 

This option is not effective as it fails to achieve the 
objectives with regard to the functioning of the internal 
market for tractors and with regard to the environmental 
objectives of reducing emissions from older polluting 
tractors by replacing them with cleaner models. 

This option is not efficient because it is 
expected to lead to a situation where for some 
time the market for new tractors is either not 
existing or supply will be very limited (some 
models only), which would likely lead to high 
prices. 

Where old tractors can be replaced with new IIIB 
models, a positive impacts on the environment would 
materialise but this is unlikely to be the case for all 
models, leading to negative impacts on the 
environment and on the functioning of the internal 
market in tractors..  

Feasible. 

Option 2 -  
Provision of 
government 
backed loans 
to finance 
stocking of 
IIIA engines 

This option would provide tractor manufacturers with the 
access to finance the purchases of Stage IIIA engines, 
would allow them to continue to generate revenue 
necessary to develop Stage IIIB compliant tractors and 
would allow them to put Stage IIIA compliant engines on 
the market during Stage IIIB. It would therefore achieve the 
policy objectives regarding the internal market. At the same 
time it would have only some effectiveness regarding the 
development of IIIB tractors if tractor manufacturers would 
buy large numbers of IIIA engines for stocking and thus 
avoid having to redesign their tractors for IIIB engines.  

Resources and time necessary for setting up the 
control system of stocked engines and 
surveillance by type approval authorities of 
Member States would be substantial. It would 
be expensive for tractor manufacturers due to 
the additional cost of preparing engines for 
longer stocking. There would also be a risk that 
extra demand for Stage IIIA engines might 
lead to higher prices for those engines in the 
short term (capacity constraints), which would 
require increasing the level of loans requested 
by tractor manufacturers. It also includes the 
associated administrative costs of providing 
loan guarantees for MS and administrative 
costs for banks to provide the loans.  
Overall, this option is not efficient. 

By providing the incentive to produce more Stage IIIA 
engines, this option might result in a large number of 
Stage IIIA engines being produced instead of the 
development of cleaner Stage IIIB engines. This would 
act as a counter incentive to innovate and to develop 
more environmentally friendly tractors, which makes 
the option not coherent with the overall policy in this 
domain.  

Feasible, but this option raises 
concerns with respect to the 
compatibility with EU-state aid 
provisions. No information 
available on willingness of MS to 
support. 

Option 3 -  
National 
scrapping 
schemes 

A scrapping scheme will stimulate demand for Stage IIIB 
compliant tractors but will not assist in helping tractor 
manufacturers to actually develop compliant tractors. 
Therefore it will only partly be effective in reaching the 
environmental objectives. Where not all MS introduce 
scrapping schemes or where the conditions of the schemes 
differ, there is a big risk that the internal market objectives 
will not be reached. 

Substantial funds at national level will be 
required to provide the scrapping subsidies. At 
the same time, where a technical solution is not 
yet available (no IIIB tractor), it would not 
work. 

Positive impacts on environment as the use of a 
scrapping scheme will provide an incentive to the users 
to buy new tractors with cleaner Stage IIIB engines 
where they are available. Likely negative impacts on 
the internal market, where national schemes diverge. 

This option raises concerns with 
respect to the compatibility with 
state aid rules. Besides, the 
Commission is not aware of any 
MS plans to introduce a scrapping 
scheme, which makes this option 
unfeasible.  

Option 4.1 -  
Scaled 
Flexibility 

This system would in theory be very effective with respect 
to the internal market and environmental objectives as it 
would provide a targeted solution for only those models 
where additional flexibility is needed.  

This option would require the collection of 
information on the amount of problems for 
each specific type of tractor in order to 
determine an appropriate flexibility. If that 
information were available, it would also be 

This option would provide a good balance between 
environmental and economic impacts provided that 
there was perfect information on the basis of which a 
decision on adequate flexibility for different tractors 

Given that the information 
required for the option is not 
available to the Commission, this 
option is not feasible. 

EN 

61 

EN 

 
  
 
 
Option 4.2 –  
35% 
Flexibility  

This option would allow tractor manufacturers to put 
additional Stage IIIA compliant tractors on the market 
during Stage IIIB. 

No new system to set up, no up-front payments 
from industry involved; in this respect the 
option would be efficient. 

This option is not coherent with the Commission 
proposal for more flexibility for NRMM (50%).  

This option is feasible and can be 
rather easily implemented.  

efficient as it is very targeted.  

could be taken.  

An increase to 35% is easy to implement and would allow 
industry to generate revenues in the short term in order to 
finance R&D expenses. This additional flexibility could be 
introduced without setting up any new systems and 
therefore could provide an immediate response to the crisis, 
thus meeting the internal market objective  
The increase to 35% flexibility is the equivalent of a 13 
week delay in the introduction of Stage III B. It has thus a 
limited impact on emissions from tractors and would avoid 
a situation where old polluting tractors could not be 
replaced by cleaner ones. The option thus also meet the 
environmental objectives. 

This option would be somewhat effective in relation with 
objective 1 – to maintain the functioning of the internal 
market, but it is disputable whether 35% will be enough. 
Industry stated that 50% would be required. 

There is some trade off between the economic 
incentives and the environmental impacts. There is a 
potential negative impact on the environment as the 
introduction of stricter Stage IIIB compliant tractor is 
effectively being slightly delayed. On the other hand, 
the option allows replacement of old tractors by 
cleaner ones at any point in time, thus reducing 
emissions. There also exists a risk that firms using 
flexibility have a competitive advantage in terms of the 
price over IIIB compliant models. This could 
somewhat affect competition in the short term.  

EN 

62 

EN 

 
  
 
Option 4.3 –  
50% 
Flexibility  

This option would allow tractor manufacturers to put 
additional Stage IIIA compliant tractors on the market 
during Stage IIIB. 

No new system to set up, no up-front payments 
from industry involved, therefore this option 
would be efficient.  

An increase to 50% is easy to implement and allow 
industry to generate revenues in the short term in order to 
finance R&D expenses. This additional flexibility could be 
introduced without setting up any new systems and 
therefore could provide an immediate response to the crisis, 
thus meeting the internal market objective  

There is some trade off between the economic 
incentives and the environmental impacts. There is a 
potential negative impact on the environment as the 
introduction of stricter Stage IIIB compliant tractor is 
effectively being slightly delayed. On the other hand, 
the option allows replacement of old tractors by 
cleaner ones at any point in time, thus reducing 
emissions. There also exists a risk that firms using 
flexibility have a competitive advantage in terms of the 
price over IIIB compliant models. This could 
somewhat affect competition in the short term.  

This option is feasible and can be 
rather easily implemented. 
Industry strongly supported this 
option and did not raise the issue 
of possible competition distortion.  

The increase to 50% flexibility is the equivalent of a 16 

52

week delay in the introduction of Stage III B
a limited impact on emissions from tractors and would 
avoid a situation where old polluting tractors could not be 
replaced by cleaner ones. The option thus also meets the 
environmental objectives. 

. It has thus 

Option 4.4 –  
80% 
Flexibility  

This option would allow tractor manufacturers to put 
additional Stage IIIA compliant tractors on the market 
during Stage IIIB. 
An increase to 80% is easy to implement and would allow 
industry to generate revenues in the short term in order to 
finance R&D expenses. This additional flexibility could be 
introduced without setting up any new systems and 
therefore could provide an immediate response to the crisis, 
thus meeting the internal market objective  
This option would be effective only in relation with 
objective 1 – to maintain the functioning of the internal 
market. On the other hand industry stated that 50% would 
be enough. 

No new system to set up, no up-front payments 
from industry involved; in this respect the 
option would be efficient. But it is not efficient 
due to the environmental trade-off, more 'old' 
tractors coming on the market that do not 
.comply with the new requirements. 

This option is not coherent with the Commission 
proposal for more flexibility for NRMM (50%). 

This option is feasible and can be 
rather easily implemented.  

The option is not coherent with environmental policy, 
as the introduction of stricter Stage IIIB compliant 
tractor is effectively being delayed. There also exists a 
risk that firms using flexibility have a competitive 
advantage in terms of the price over IIIB compliant 
models. This could somewhat affect competition in the 
short term.  

52 

EN 

If  all  of  the  flexibility  was  used  straight  away  in  the  current  20%  flexibility  scheme  then  the  manufacturer  could  delay  using  Stage  III  B  by  10  weeks,  instead,  under  the 
proposed 50% flexibility the manufacturer can delay by 26 weeks. Therefore, assuming constant sales, this is an extension of 16 weeks. 

63 

EN 

 
  
 
 
 
 
 
                                                 
Option 4.5 –  
Penalty 
mechanism 

This option would be effective regarding the internal 
market and environmental objectives if the optimal level of 
the penalty could be determined and is uniform across 
firms. This is however not possible. 

Option 4.6 -  
Trading 
scheme 

If it were possible to set up such a system it would in 
principle be effective in reaching the internal market and 
environmental objectives. 

Option 4.7 - 
ABT 

In principle it might be effective but it would take too much 
time to implement; in addition EP and Council disapproved 
it before. 

. 

Creating and implementing a penalty system 
would place administrative burden on MS, 
Moreover if the measure was to be harmonised 
and implemented identically in all MS, 
additional costs would be involved at the EU 
level (funding resources, notification and 
surveillance, translation costs etc.). It is 
therefore not considered to be efficient. 

Additional EU and national resources would be 
needed in order to put the trading scheme in 
place. However, the advantage of such a 
system is its built in mechanism leading to 
efficient avoidance of pollution and efficient 
innovation. 

This option would be rather coherent with 
environmental and competition objectives and 
providing incentives to innovate. 

Due to the lack of data this option 
is not feasible. 

This option would be coherent with environmental and 
competition objectives and providing incentives to 
innovate. 

The time taken to develop a 
trading system would not be 
effective in meeting the immediate 
requirements of the industry. It is 
not feasible in the scope of a few 
years. 

See option 4.6 above. 

See option 4.6 above. 

See option 4.6 above. 

EN 

64 

EN 

 
  
ANNEX XI: Calculation of environmental impact and maintenance costs 

1. Calculation of environmental costs (paragraph 7.1.2) 

Building on the 2005 figures53 for the NRMM sector, where the average share of emissions 
exhausted by new engines put on the market during one year accounts for around 5% of the 
total  emissions  of  NRMM,  while  the  remaining  95%  comes  from  the  engines  already 
operating on the market, we can assume that the situation looks similar in case of the tractors' 
sector. 

The  amendment  of  flexibility  from  20%  to  50%  would  increase  the  emissions  of  newly 
produced  machinery  within  the  first  year  by  about  9%  compared  to  the  current  scheme. 
However, the overall machinery CI engine emissions would increase for the first year under 
the  50%  flexibility  by  around  0,3%  compared  to  the  current  20%  scheme.  In  absolute 
numbers the amounts of emissions can be quantified to about 0,66 kt for PM and 9,8 kt for 
NOx per year for all NRMM.  

When we assume that the contribution of tractors to overall agricultural machinery emissions 
will not change (45% for PM and 40% for NOx – JRC study), the same approach would lead 
to 0,3 kt for PM and 3,9 kt for NOx per year54. 

2. Maintenance of old tractors (paragraph 6.1) 

Copy from ARCADIS SME study: 

"In Section 8.1 we had reported that if a high clearance tractor is used beyond its economic 
lifetime, annual maintenance costs can be expected to increase from 1500-2000 EUR per year 
to 3000-4000 EUR per year. 

For illustrative purposes, we assume that the cost increase is 2 500 EUR per year per tractor, 
and that all special tractors face the same increase in maintenance costs as the high clearance 
tractors. To remain consistent with the IA study, we assume that a technical solution can be 
found 5 years after the planned introduction date of the next emission stage, that a total of 25 
600 units are sold per year in the EU and that a discount rate of 4% applies. 

For the T4.1 tractors, based upon the response received during the consultation, we assume 
that 400 units are sold per year.  

To the best of our knowledge, no data on the sales of C2 tractors are publicly available. Thus, 
in total we assume that 26 000 special tractors are sold per year. We assume that all sales 
correspond to replacement sales and that, once the technical solution has been developed, old 
tractors are replaced at a rate of 26 000 units per year. The table below gives then, for each 
year after the planned introduction of stage IIIB until all “old” tractors have been replaced by 
stage IIIB compliant tractors, the increase in the number of tractors that are kept in use 
beyond their economic lifetime and the implied extra maintenance costs at the EU level. 

53 

54 

Summarised sales table of new tractor to be placed on the market and table of existing tractors, covered 
by the tractors Directive, are available in Annex V 
Based on JRC table 5.4 data of 26 kt PM and 515 kt NOx p.a. See Annex XII for further details. 

EN 

65 

   EN 

 
                                                 
Table 5: Extra maintenance costs for special tractors used beyond economic lifetime 

Year 

Number of tractors kept in use  Extra cost per year 

1 

2 

3 

4 

5 

6 

7 

8 

9 

26 000 

52 000 

78 000 

104 000 

130 000 

104 000 

78 000 

52 000 

26 000 

65.000.000 

130.000.000 

195.000.000 

260.000.000 

325.000.000 

260.000.000 

195.000.000 

130.000.000 

65.000.000 

The net present value of these costs (discounted to the planned introduction of stage IIIB) is 
1 339 million EUR. This is an order of magnitude higher than the environmental benefits 
linked to not postponing stage IIIB with 5 years (120 million EUR). 

Thus, even if actual higher maintenance cost would be significantly lower than suggested by 
the manufacturers, the costs of not postponing stage IIIB would still be much higher than the 
benefits." 

EN 

66 

   EN