Ford Figo Diesel Engine

Planning to buy a diesel variant due to skyreaching petrol prices? Think over it again. The diesel variant cost almost 1 lakh more than its petrol counterpart. Imagine another 1 lakh increase. Will you not think again? The oil ministry has planned to impose taxes on diesel vehicles. And these special taxes would increase the prices of small diesel cars by Rs. 1,70,000/- and that of medium and large vehicles by Rs. 2,55,000/-. Such decision has been taken in order to reduce the price differential between petrol and diesel to offset the huge imbalance in demand for cars.

The news has not been taken in a good spirit by the automakers. According to them, there is already a slump in the demand for petrol cars and any further increase in the prices of the diesel cars would only make the situation worse for the auto industry where the demand of the diesel variant was picking some speed. Till, now we had stable diesel fuel prices, thanks to the political pressure. With these additional taxes on diesel models, the demand for these too would taper.

“Sales of new cars is already slowing. We have cut production of our petrol models in tandem with the changing market dynamics, and any tax on diesel cars would further taper off demand,” S Nakanishi, MD, Maruti Suzuki said.

In the past few days diesel cars were chosen over their petrol counterparts as they are more fuel efficient and offer 30 percent more mileage. Moreover diesel currently costs 74 percent cheaper than petrol. Thus, the sales of diesel cars increased to 55 percent of the total units sold over that that of the previous year when it was just 38 percent. Perhaps, the move might be ‘politically’ correct but then, its not just the automakers who would be impacted but also the general public as now they have to put more efforts on their grey matters to choose a car.