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Old 3rd June 2020, 13:27   #16
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Ford should have a wild swing at this claim and remind people that their BS6 and prior BS4 diesel product costs/costed lesser to buy, maintain, and break even to recover the higher cost price versus petrol.
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Old 3rd June 2020, 18:06   #17
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Sounds about right. When I was working on the economics of EVs, I had come to a similar number. I took only two parameters into account - fuel expense and EMI one would pay if the car were to be financed 100% at standard 5 year loan rates. Only at about 3500km a month does the premium paid on diesel car is offset by fuel cost savings.
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Old 3rd June 2020, 18:17   #18
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Quote:
Originally Posted by pganapathy View Post
Low running cost is an India-specific phenomenon because diesel is subsidized, leading to a price differential. Most markets globally, petrol and diesel are fairly similar in price. Yes, diesel has a slightly higher calorific value and produces high torque. Driven sanely and at highway speeds, the mileage is slightly better. However, if petrol and diesel were priced the same, very few people would opt for diesel in my view. Goa is an example where the pricing is the same and petrol cars outsell diesel cars.
No, its not subsidised and prices aren't that like that in 2011 or so, Europeans buy diesels and if anything it's more expensive. They are more fuel efficient, and nothing will change that.

Maruti dropped the ball on this and yes diesel will remain a significant part of sales until legislation kills it. Maruti aren't known for their engineering prowess, they should have found a supplier before they decided to kill a fuel efficient diesel engine. I don't know where they got this 260k km figure, most manufacturers don't mark up their diesels like Maruti. The premium is probably a case not to buy a Maruti diesel, other brands offer reasonable prices. People with low running shouldn't buy a diesel, especially the bs6 versions, diesel is meant for heavy users and those who prefer driving to other means of transport. I have said this before and I repeat, diesel found buyers in such large numbers because of government policy.
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Old 3rd June 2020, 18:27   #19
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Quote:
Originally Posted by pganapathy View Post
Low running cost is an India-specific phenomenon because diesel is subsidized, leading to a price differential. Most markets globally, petrol and diesel are fairly similar in price.
Diesel was subsidized. To the best of my knowledge, it isn't anymore. If anything - the regular hikes in excise duties and surcharges have net rolled back some subsidy expenses.

Diesel in India is cheaper because it was BSIV till now. EuroV / EuroVI compliant diesel in EU is costlier and somewhere around petrol prices. I'm not yet 100% sure if the BSVI diesel is now available in our bunks and how that is going to affect net pricing paid by retail consumers.
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Old 3rd June 2020, 18:52   #20
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Please see below the Terms & Conditions in the Maruti link for cost comparison (https://www.marutisuzuki.com/petrol-...jvobt_0J5Ezqjo):


*Calculation done basis Ex-Showroom Price only.
*In all above calculation , consumer offers are not considered.
*Comparison is being made between Maruti Suzuki Petrol and Diesel Model if Maruti Suzuki would have launched Diesel in BS6.
*Maintenance cost for calculations is as per internal service data for Maruti Suzuki BS4 Petrol Model and Maruti Suzuki BS4 Diesel Model. The cost has been calculated up to 1 Lakh km. The cost mentioned is only for periodic maintenance jobs, parts and consumables of base models. The prices for parts and labour are as on 1st March 2020 and subject to revision / changes. The prices are applicable at Arena workshops. All parts/ consumable cost is at MRP and Labor amount is without tax.
*The average price difference in maintenance cost of Petrol and Diesel Models as per internal Maruti Suzuki data is Rs 18 paisa/km. The maintenance gap between Petrol and Diesel for Scross, Brezza and Ignis has also been assumed to be 18 Paisa/km.
*Petrol is recommended choice if payback period is more than 73.7 months. 73.7 months is the length of ownership of previous vehicle of Diesel Customers as per New Car Buyer Survey (third party study)
*Fuel efficiency considered for calculation is ARAI mileage of Maruti Suzuki BS6 Petrol and Maruti Suzuki BS4 Diesel.


The price difference quoted for XL6 in Delhi is 1.2Lakh. That means, if they launch the BS6 Diesel, it will be priced on par with BS4 Diesel!

I was doing the cost calculation for XL6 in Delhi, and if we set the loan amount as 90% and tenure as 10 years, the breakeven comes at 2.52L KMs! Even for Swift with 90% loan and 6 year tenure, the break even comes at 2.06Lakh KMs.

Last edited by romeomidhun : 3rd June 2020 at 19:10.
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Old 3rd June 2020, 19:09   #21
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Picture this:

Maruti Suzuki Super Carry BS6 petrol with 1196 c.c. 4 cyl engine: Rs 4.24 lakhs

TATA Ace Gold BS6 diesel with 700 c.c. 2 cyl engine: Rs 5.15 lakhs

Straight 91k difference between the two vehicles, even though the SC has 2 more cylinders and higher displacement. What's more, the Ace Gold comes with 145 R12 whereas the SC has 155R13s. All due to the additional components like DOC/DPF/SCR. Break even period for a typical mini-truck BS6 diesel vehicle comes out to > 3 years if driven for 100 kms daily! And now the price difference between petrol-diesel has all but disappeared.
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Old 4th June 2020, 09:05   #22
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Quote:
Originally Posted by ObsessedByFIAT View Post
I rest my case, with reminding you of Nokia story. If one does not move with the trend in market, they stand to loose a lot.
Though I am against the decision not to launch BS6 diesel, the trend is not diesel. The trend is Petrol, hybrid and EVs. So, Maruti is much ahead of the trend than needed.
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Old 4th June 2020, 10:53   #23
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Default Re: Maruti may do a U-turn on plan to ditch diesel, diesel re-entry likely in 2021

Quote:
Originally Posted by pganapathy View Post
Low running cost is an India-specific phenomenon because diesel is subsidized, leading to a price differential. Most markets globally, petrol and diesel are fairly similar in price.
This was true in the early 2000s to 2010 timeframe and I do remember enjoying these benefits in those days as I owned an Accent CRDi. Later, I believe the Govt decided to bring it to par and increased the price gradually over a long period of time and there is no subsidy on diesel now.

Quote:
Originally Posted by pganapathy View Post
Driven sanely and at highway speeds, the mileage is slightly better.
Not slightly, quite a bit and always irrespective of conditions. Even in City traffic and bumper to bumper Bangalore traffic, I have found a diesel mill giving way higher mileage than a petrol car.


Quote:
Originally Posted by avira_tk View Post
Terrific mileage and low running costs, in any modern car safety norms add weight and current legislation means small petrol engines simply guzzle fuel when compared to their diesel counterparts. Not everyone needs a diesel, but the ones who do long drives certainly won't go for petrol.
Agree - I own a Diesel 4th Gen City and the overall average in close to 60,000 kms of ownership is above 18 kpl and this is with mileage being measured using a tankful approach for the last 20,000 kms. Even in bumper to bumper city traffic and with idling runs at signals, the mileage returned by a diesel car is something appreciable.


Quote:
Originally Posted by avira_tk View Post
The old maintenance story also doesn't hold true anymore, turbo petrols need as much if not more.
Good point, had not thought about it from a maintenance perspective about Turbo Petrols.
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Old 4th June 2020, 11:55   #24
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Default Re: Maruti now says = Diesel car costs can only be recovered after 260,000 km

Many thanks for sharing, Trooper! Moving your post to a new thread.

Wondering what Maruti will say when they launch their 1.5L diesel in BS6 form.
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Old 4th June 2020, 12:15   #25
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Default Re: Maruti now says = Diesel car costs can only be recovered after 260,000 km

Quote:
Originally Posted by TROOPER View Post
Came across this AD on Facebook

So what will MS say when they launch BS6 diesel next year?
Let me go against the thread view and state my thoughts upfront - this is a BRILLIANT ad *.

* from a marketing and behavioral tactics standpoint

Reasons:
- They need to ace up their sales vis-a-vis competition, especially as there will definitely be a bit of a +ve movement of new car sales post lockdown
- No diesel cars in their arsenal so that's easily 50% (generic figure) hit of the potential new business inaccessible
- Does not, and I can't imply this better in any other manner, impact their past/existing customers (I'm sure if a diesel owner calls up the dealership/service center and complains, the SA would just shrug it off and ask you to ignore 'meaningless' sales ads)
- The average joe on the street is not going to get into the calculations; max s/he would give the calculator a shot
- Most important - this DOES NOT impact the potential new petrol customer base

Even if 10% of customers looking out to buy a new diesel car give some thought to this ad, it's a win. I'm sure more than that will be impacted.
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Old 4th June 2020, 12:19   #26
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Default Re: Maruti now says = Diesel car costs can only be recovered after 260,000 km

If you keep pricing it higher compared to petrol then ofcourse it will take longer to recoup the extra costs. Good old days when diesel car was only 40-50k higher than petrol iirc for gen-1 swift.
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Old 4th June 2020, 12:27   #27
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Default Re: Maruti now says = Diesel car costs can only be recovered after 260,000 km

Lack of diesel will not have a severe impact on Maruti except for few models like Ertiga/Dzire Tour/Brezza. Diesel is important in SUV costing 15-20Lac or more and Maruti has no presence.

Last edited by Gannu_1 : 4th June 2020 at 12:33. Reason: Maruthi > Maruti
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Old 4th June 2020, 12:35   #28
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Default Re: Maruti now says = Diesel car costs can only be recovered after 260,000 km

I did the math much before them, and calculated the break even cost to be 2 lakh KM (I assumed the Fuel efficiency to be the same, since K12 is one fuel efficient motor), so the saving has to come from the lower cost of the diesel.

I dont really blame MS. It has become fashionable to hate MS. But then, it always has been to hate the most popular thing in any market, how else are you going to stand out on a forum.
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Old 4th June 2020, 12:42   #29
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Default Re: Maruti now says = Diesel car costs can only be recovered after 260,000 km

They have forgotten a few things.

Not everyone buys a diesel for the economy.
Diesels are a pleasure to drive on the highways, due to their effortless torque.
They offer the ideal mix of performance and fuel efficiency.
Turbo petrols can give the performance, but they fail on the fuel efficiency parameters.
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Old 4th June 2020, 12:49   #30
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Default Re: Maruti now says = Diesel car costs can only be recovered after 260,000 km

Quote:
Originally Posted by PrideRed View Post
Lack of diesel will not have a severe impact on Maruti except for few models like Ertiga/Dzire Tour/Brezza. Diesel is important in SUV costing 15-20Lac or more and Maruti has no presence.
The impact will be felt, the margins on the expensive models in the lineup far outstrip thosefor the entry level models. The Brezza sold 5 lakhs units in 4 years, that number would be significantly lower if it was not available in diesel. The problem is not that petrol won't sell, without diesel, there's no reason to choose the Brezza. Modern options exist and more are on the way from rivals, the petrol options are better and customers will notice the difference in quality.

This is also bad news for shareholders in the long run.
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