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Diesel car sales zoom as buyers look for cheap ride

autos Updated: Nov 06, 2011 00:39 IST
Chetan Chauhan

Majority of Indians prefer polluting diesel cars over petrol with the difference in price between the two fuels almost doubling in the last two years because of frequent increase in petrol prices.

In July 2009, the difference between petrol and fuel price in Delhi was Rs 11.76 which increased to Rs 27.53 with latest petrol price increase from Thursday night.

The increasing difference had shown impact on car sales with the share of diesel cars in popular car segment (Rs 4 to Rs 10 lakh) increasing from about 48 % in 2010-11 to around 52 % by September 2011.

"Sale of diesel cars in new sales is increasing at a rapid pace whereas that of petrol cars is falling. In the popular compact car segment, diesel car share is already over 50%," said Anumita Roy Chowdhury, deputy director with NGO Centre for Science and Environment (CSE).

Price (per litre)
Petrol Diesel
July 2009 Rs 44.63 Rs 32.87
June 2010 Rs 51.43 Rs 40.10
Nov 4, 2011 Rs 68.65 Rs 41.12

Having a finer look at the 2011 car sale data shows that 70-75% of cars being sold, where both fuel variants are available such as Maruti Swift and Fort Figo, were of diesel.

Other popular diesel cars include the Volkswagen Polo & Vento, Nissan Micra, Skoda Fabia, Maruti DZire & Sx4 in upto Rs 10 lakh market.

"Driving a diesel car costs about 50% less than a petrol car at present prices," said Abdul Majeed, auto analyst with research firm PricewaterhouseCoopers (PwC), who believes preference for diesel cars to increase if the price gap between two fuels remain high.

This was despite the fact a diesel car on average costs up to Rs one lakh more than a petrol car.

On the negative side, the growing preference for diesel cars is already showing its environment impact with nitrogen oxide levels - a major diesel pollutant - rising in major cities such as Delhi and Mumbai.

Compact car sales (range of Rs 4 to Rs 10 lakh)
Petrol Diesel
2009-10 6.17 lakh 2.61 lakh
2010-11 6.01 lakh 4.88 lakh
2011 (till Sept) 2.02 lakh 2.25 lakh

"Diesel emits more black smoke than petrol and is, therefore, bad for air quality," said SP Gautam, chairperson of pollution watchdog, the Central Pollution Control Board. Society of Indian Automobile Manufacturers (SIAM) blamed the fuel quality than vehicles for higher emission from diesel cars.

The price difference has also pushed demand for conversion into Compressed Natural Gas, which is priced at about Rs 30 per kilogram in Delhi and Mumbai.

According to an estimate by Supreme Court appointed Environment Protection Authority of India, over 50,000 cars are converting into CNG fuel every month in Delhi alone.

Data source: Centre for Science and Environment and Society of Indian Automobile Manufacturers