[vina]

Originally Posted by Equus

Are you implying that buyers arent considering what I mentioned? Even folks who commute less than 20kms per day are considering diesel (at a lower segment if that be).

So how is it off-topic from the end of petrol cars discussion?

The post I wrote off topic was basically an i20 vs. Swift Vdi post - there ie one line on diesel and that's it.

The thread is about how diesels are kicking petrols' behind - let's keep it at that. Let's not bring handling, ride, equipment level and the works into picture.

[NPV]

Originally Posted by aravind.anand

The day has come! When you tell people that you just purchased a new Petrol car, the give you that weird look and ask what's wrong with you! Gone are the days when you bought a diesel car and people commented that diesels were meant to power the trucks and not cars! Sigh! How days rush by :(

Couldn't have said this better
I remember when I bought my Indica DLX in 2004 a lot of people I know were shocked, 'a diesel car that too a small car' was the reaction. But the car did serve me well for the ~5 years I used it but when I looked to replace it, I went for a Dzire Vxi (petrol) in Jan 2009 and the decision was based on our plan for a second car a used Maruti 800 and my weekday city drives would be minimal on the Dzire so petrol was the choice. Now, guess what - after I buy the Dzire Vxi the same folks are now shocked with the opposite reaction - 'why not a diesel car it would've been the right choice' !

[indian21r]

Ground reality. Diesel price increase of even Rs 5 affects the whole value chain with prices increasing across the spectrum. So for it to cover Rs 20-30 range in the near future is next to impossible. afterall people in India have to be able to afford a decent meal a day. So that is ruled out. Infact the gap may widen further down the road.

Probably the only way Government will try to address this gap is increase the Price of Diesel Cars to factor in atleast some amount of Subsidy at one time.

Coming to the topic, will petrol cars end? a big No. There are still a lot of families in India who use the car only on the weekends. For them usage to exceed beyond 500Kms a month is difficult, really difficult. The target market for this is the budget conscious India which is a huge market in itself. But the scenario changes as the price of the car goes up.

Yesterday I was discussing with my brother-in-law who drives a Verna Diesel. He swapped his car for i10 for 3 weeks. Now for the same commute his expenses have almost touched 170% in such a short time. He was once a petrol head who hated diesel sound. Now Converted fully into a Diesel Man. Not even ready to consider petrol at any cost for a new car. Further the EMI difference will more than cover up for Price difference.

I am in the market for a new /used hatchback. But we recently took a used Alto for my Sister to learn to drive and it is as expensive to run and maintain per Km as our Innova. That and the fact that new swift is being launched changed my decision to go for the diesel Swift.

Once you are used to a diesel, it is really difficult to go back to a petrol car. The overall cost per km is too good to be ignored.

[JediKnight]

Hi,

For the benefit of the members of this forum, diesel is not "subsidised" but taxed less than petrol. "Subsidy" is a term used by government to confuse the common man.

It may be impossible to deregularise diesel prices in India. Since it is directly linked to food inflation. So there are two ways to get around this problem:

1. Seperate out diesel for trucks/buses/trains/tractors and personal vehicles.

2. Tax a personal diesel vehicle at the purchase time to offset the "subsidy" cost.


Option 1 is ruled out. It will be very difficult to implement. And in a corrupt country like ours it will create a massive black market for diesel.

Option 2 is very much doable. I belive this will happen sooner or later.

So the moral of the story is get a diesel hatch now, before the government introduces a tax on diesel vehicles.

[Equus]

Originally Posted by JediKnight

Hi,

For the benefit of the members of this forum, diesel is not "subsidised" but taxed less than petrol. "Subsidy" is a term used by government to confuse the common man.

It may be impossible to deregularise diesel prices in India. Since it is directly linked to food inflation. So there are two ways to get around this problem:

1. Seperate out diesel for trucks/buses/trains/tractors and personal vehicles.

2. Tax a personal diesel vehicle at the purchase time to offset the "subsidy" cost.


Option 1 is ruled out. It will be very difficult to implement. And in a corrupt country like ours it will create a massive black market for diesel.

Option 2 is very much doable. I belive this will happen sooner or later.

So the moral of the story is get a diesel hatch now, before the government introduces a tax on diesel vehicles.

(I am going way off-topic here)

I sincerely hope atleast some piece of this goes to the OMC (oil mktg companies).. They are good companies with good mgmt, but are always under the threat of Govt stealing from them.

[ajmat]

Originally Posted by deep_bang

well. I have seen several Logan cabs having done 2 to 3L kms and seriously driving nicely even after all that.

Qualis is another example of seriously high mileages.

Originally Posted by oxyzen

There are basically 2 reasons why people are migrating towards diesel.

I agree things are going to get nasty with DPF.
But failed turbo, worn injector is a rare possibility. Sure the low end torque if high, but this factor is very well taken care of while designing the clutch.

There are a lot if Logans/Innovas woth 5L km on the odo. Yoy only need to get it serviced properly.

I somehow don't agree with all these projections. I have seen enough high mileage diesels (well beyond 100k kms) functioning without any such issues.

Re: Logans, Innova's, Octavia TDi's - those engines do not work to higher pressures and tolerances compared to the latest cars. These cars no doubt run on and on

Failed turbo's, injectors - I see a lot of these things happening nowadays in Europe. BMW's are known for failed turbo's, VW/Audi PD engines have problems with injectors.

In the quest to extract more power, the engine gets squeezed for more. Issue is in Europe, a car is expectted to last for 7 years. Over here till Armageddon!

[Santoshbhat]

Originally Posted by Zappo

Frankly, I do not see this diesel subsidy going away any time soon.

There are two aspects to consider here. One is the yawning gap between diesel and petrol pricing. People say this gap will ameliorate over a period of time. May be it will. However, the ground realities are far removed from it. Look at today's pricing. 10 years back the difference between a liter of petrol and diesel was approximately Rs. 15. People kept saying that gap between the prices of diesel and petrol will fill in. 5 years back this chasm actually grew wider and the difference was around 20 and 22 bucks. The clamor for removal of subsidy went higher for a while. If I remember correctly, that was when the diesel was increased by Rs.3 whereas petrol went up only by Rs.2 or something like that. People said that 'its happening'. See today. The difference is actually now of 30 bucks!!! The gap has only increased over the years.

The second point to consider here is more subtle and nuanced. Suppose this massive subsidy were to vanish tomorrow. How do you expect this sudden surplus to be used? Do we expect a tremendously cash surplus budget? Do we think that all of a sudden our infrastructure will start getting extra dollops of push to make us finally compete with other nations of our size, "stature" and pretentions? I do not think so. All that money will only find its way to millions of other populist measures in different forms. Even if someone wanted to divert the money for something worthwhile the political pressures from all around will ensure that the money is squeezed out to the last drop by the politicians and babus for other ill advised ventures. If anything, the government of the day will loose from every direction. Not only will they fail to put the money to any worthwhile usage (yes they will make a lot of noise initially but nothing will actually come out of that finally) but will also loose the goodwill of the farm sector, transportation, traders, households and pretty much all that one can think of.

Does it sound like any government is ever going to commit such a political harakiri? I do not think this is going to happen any time soon. They will keep tinkering with the prices, yes, but nothing more will come out of it. Afterall, they do not stand to gain anything other than hundreds of newer headaches if they were to stop subisidizing the diesel.

The Govt. is selling diesel at regulated prices at the cost of Oil companies. It is the Govt. owned oil companies that are bearing the brunt of under recoveries and making losses in the process. If crude prices increase further, the Govt. may not have the luxury of subsidising diesel. Already the Oil companies are bleeding with the huge losses on Kerosene , Diesel and LPG. So if the Govt. is forced to reduce this subsidy it may not result in any surplus at all. Luxury of having a budget surplus is out of question. Any Govt. which decides to reduce or cancel subsidy will be taking that decision out of sheer compulsion and helplessness.

Here's a recent article on how custom duty reduction has allowed Oil companies to make profit on sale of petrol.

"From a loss of Rs 10.50 on every litre of petrol sold a few weeks ago, oil marketing companies (OMCs) have started making a profit of around Rs 0.60 per litre on the fuel, thanks to the Customs duty cut and the decline in international crude oil prices.

Based on a monthly sale of 1.3 million kilolitres, the oil industry would earn Rs 78 crore every month from petrol at current levels, said an industry official, who did not wish to be quoted."

source : Duty cuts, global prices make OMCs smile at petrol - The Smart Investor

Yes 'Profit'. Diesel subsidy is allowing car makers to cash in and make huge profits on diesel cars. Mobile telcom companies are using this subsidised diesel to power their towers and make huge profits. At whose cost? The Govt.'s cost. i.e. the tax payers' cost.

[rajanprash]

I strongly stand by the point that it is high time to introduce new fuels into the market. Most of the petrol cars ( manufactured 2009-2010 ) onwards have E10 compliant engines. Then why not the fuels ? When India is getting all the new technology from all over the world , Why not the fuel ?
If we get E10 fuel , it would not only be pocket friendly but eco friendly also.
Being a petrol-head , i would prefer to use such fuels for my daily use and unleaded petrol when i need some fun !

[mgh]

Diesel cycle is thermodynamically more efficient than the Otto cycle (used in petrol cars).
The problem with diesels is inherently higher pollution. With the latest technologies, pollution is no longer an issue.

[asr245]

Aren't we going wayyy off-topic? These things have already been discussed in another thread here.


There are still many people who drive much less than 1000kms a month especially in tier-2 cities. And the thing is as diesel sales climb higher and higher, the pressure on the government to do something about it increases. One can surely expect either decrease in subsidy on diesel or increase in taxation of diesel cars/SUVs in the near future.

[lionell]

Originally Posted by asr245

And the thing is as diesel sales climb higher and higher, the pressure on the government to do something about it increases. One can surely expect either decrease in subsidy on diesel or increase in taxation of diesel cars/SUVs in the near future.

I so agree with your comment there.

It seems like petrol consumers are bearing the cost of the diesel subsidy. Like in the UK petrol and diesel prices are at par for private consumers. A recent short mileage test by 'fifth gear' between a petrol and diesel ritz (splash in the UK) showed that the mileage was almost at par too, so why buy a diesel when you a superior smooth petrol engine to do the runabouts.

The government should ideally propose a different diesel rate for private and commercial vehicles where the latter is subsidized.

[supremeBaleno]

As long as petrol does not die (is available to fuel the petrol cars we have), I am indifferent to petrol-cars dying.

There is money and then there is the pleasure of driving. For the former, get yourself 1/2/3 cyl sluggish diesel cars and keep puttering around town on subsidised diesel. I am happy driving petrol cars that makes one feel alive, even if petrol costs 45% more. Case in point being a colleague's new Punto-90hp that I drove yesterday (fair comparo to my Baleno's 91bhp) - at 2K rpm, it feels like I am physically pushing the car along, while 2K rpm on the Baleno is brisk and raring to go. Petrol anyday !!!

[arup.misra]

I have a slightly different opinion on the subject of petrol vs. diesel cars.

One of the biggest impetus for diesel car sales is the subsidized fuel available in our country. This I believe will hurt us more in the future.

The first reason is fiscal consolidation. The amount allocated for petroleum subsidy in the Budget (Rs 23,640 crore) factored in an average price of around $76 per barrel for crude in FY12. If the average price rises to $105 per barrel or higher, containing the fiscal deficit at 4.6 per cent of GDP will prove impossible.

The second reason is the need to encourage conservation practices. Only when consumers feel the pinch of higher prices will they consume less oil and adopt conservation-related practices. High fuel prices will also provide a fillip to alternative fuels which will be the only sustainable form on energy given that we are very near peak-oil period.

Third is diesel subsidies have created several distortions. India is already a water-stressed country. Ideally, in dry regions farmers need to shift to crops that require less water and deploy water-efficient irrigation practices such as drip irrigation. But in India none of this happens because subsidized diesel allows farmers (mostly rich farmers) to overdraw ground water. The rapid depletion of ground water, especially in north India and the Gangetic belt, will lead to severe shortages in the not-too-distant future.

The positive aspect of having market-linked prices is that actual users bear the brunt of higher prices. Yes I may be scorned at but if we citizens can afford the luxury of driving cars, sustaining better lifestyles (atleast when compared to our parents generation), earning better pay than what our parents did at our age then I don't think shelling out a few more bucks for gas (petrol or diesel) should be condemned.

When the government subsidizes fuels, the entire economy bears the costs while the benefits often go to the undeserving. Thus it is a fallacy to think that subsidized fuel is cheap. A higher subsidy burden plays havoc with the government's finances. The government then responds by either levying more taxes or borrowing more. Higher government borrowings crowd out private-sector borrowings (the latter are unable to borrow as much as they would like to). They also exert upward pressure on interest rates, thereby making capital more expensive. Many projects (corporate capex plans as well as infrastructure projects) are then rendered unviable. When corporates don't expand capacity, all of us pay the price in terms of higher costs of manufactured goods. And poor infrastructure is only too evident at every turn in our daily lives for me to belabor its significance here.

This is not to say that subsidies should be withdrawn for everyone. It can be continued for the underprivileged, farmers and even for transporting commodities. But subsidizing diesel for luxury (read – cars) is simply a slow poison that will eventually affect all of us – whether we drive or not.

P.S. I also own a diesel hatch.

Disclaimer – The views expressed by me is entirely personal and I’m not intended to hurt sentiments of any user (s). If I’d so accidentally I apologize at the outset.

[ashok_lat]

Originally Posted by JediKnight

Hi,

For the benefit of the members of this forum, diesel is not "subsidised" but taxed less than petrol. "Subsidy" is a term used by government to confuse the common man.

It may be impossible to deregularise diesel prices in India. Since it is directly linked to food inflation. So there are two ways to get around this problem:

1. Seperate out diesel for trucks/buses/trains/tractors and personal vehicles.

2. Tax a personal diesel vehicle at the purchase time to offset the "subsidy" cost.


Option 1 is ruled out. It will be very difficult to implement. And in a corrupt country like ours it will create a massive black market for diesel.

Option 2 is very much doable. I belive this will happen sooner or later.

So the moral of the story is get a diesel hatch now, before the government introduces a tax on diesel vehicles.

Why tax the vehicle at the purchase time. I would suggest for an yearly tax. If taxed at purchase time people can get away by buying 2nd hand cars or people who are having diesel cars right now.

Personally i don't want the above to happen as i going to buy a diesel hatchback.

As far as petrol car i would still love owning a petrol car as it is very smooth comparing to diesel car. May be manufacturers should introduce new technologies(Even VVT is also new to may segments). Introduce turbo petrol's which is more fuel efficient and powerful.

[kiku007]

No is the answer.

It is (infact it has already) the beginning of making cars travel more kms/litre and pollute less/km irrespective of whether the fuel is petrol, diesel, electricity, hydrogen etc.

However in India, in the recent past we see that we are offered more powerful diesel engines but trimmed down and fuel efficient petrol engines. So the choices for petrolheads are shrinking. That's a disturbing fact.