TURN OF THE TIDES? ARE DIESEL VEHICLES BECOMING MORE POPULAR?

The demand for diesel vehicles has been soaring. The demand is so high that in case of vehicles that have both petrol and diesel variants, the diesel versions have grabbed as much as 80% of the sales in many cases.

Industry data shows that while sales of petrol cars and other vehicles have declined by 15% this past fiscal year (April 2011 – Feb 2012), the demand for diesel vehicles has surged by 35%. The petrol decline has meant an uncertain future for some of India’s strongest car brands, most of whom do not have a diesel variant. The Maruti Alto has seen volumes go down 11% in the period, while Hyundai’s i10 has seen numbers go down 23%. The WagonR has seen volumes slip by 11%, while Santro’s numbers have gone down by 14%. Sales of the Honda City is down 27%.

The story is a little different in case a diesel variant is available. Sales have seen a big surge. GM’s Beat has seen volumes go up 45% after it introduced a diesel variant while Volkswagen Polo’s numbers are up 42%. Hyundai Verna’s volumes are up by an astounding 136% while the Volkswagen Vento’s figures are up 109%. Maruti Swift’s diesel sales are up 10% even as the petrol version’s declined.

Company officials say diesel vehicles are not only more fuel efficient but also more easy on the pocket due to the fuel’s lower price against petrol (diesel is Rs. 45.28 per liter in Mumbai while petrol is Rs. 70.66 per liter).

People are ready to shell out an average of Rs. 1 lakh more to buy a diesel vehicle in order to enjoy the lower running cost the vehicle offers over petrol. The running cost of a petrol car per kilometer is nearly three times that of a diesel car and this calculation weighs heavy on the mind of customers at a time of high inflation and bulging EMIs.

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