[Dr.AD]

Originally Posted by ramzsys

This sort of conclusions(the verbatim) are often seen in 24x7 news channels.

I don't know what you mean by that and why you feel so. Remember, I did not bring that poll into discussion here. Someone else brought that to suggest that diesel manufacturers need not worry. All I was pointing out that if we were to look at that poll (which personally I don't believe is very meaningful) the results are actually bad for diesel manufacturers, and not good. There is no point is looking at any poll (accurate or inaccurate) and wrongly interpreting the results.

Originally Posted by ramzsys

'Once a diesel, always a diesel' as successive advancement to the common rail technology is boosting both power and mileage and there is no compulsive motivation to return back to petrol.

PS: there is still no mass produced turbo petrol in India.

I appreciate those who like diesels and will say 'yes' to diesel at any cost. However, the key question here is that how many of the current diesel buyers actually buy it because they are in love with diesels and not because of any economic reason. I personally know many diesel car owners who don't even know that their cars have higher torque and lower horsepower than the petrol counterparts, and all they keep talking about is the money they are saving every month. They don't even know the low-rep or high-rpm thing. They don't even look at tachometers and don't know what is the use of tacho. Do you think these people will still buy diesels if the monthly savings (real or apparent) are gone?

And by the way what is the big deal with turbo anyway? Diesel engines need them because of the otherwise low performance without turbos. Many naturally aspirated petrol engines perform exceedingly well (good enough even to be used in a race car) without turbos, and turbos are never a 'make-it or break-it deal' for petrol engines (as opposed to diesel engines). Therefore, not having a mass produced torbo-petrol is not as bad a thing as it is often made to sound. Many real enthusiasts prefer a NA petrol engine over a turbo-petrol anyway.

Originally Posted by anoopap

Me going OT.
Moreover, Torque can be varied for a given power. (hope my physics is rite)

I am not sure what your point is. "Torque van be varied for a given power" by whom? Power depends on torque and not vice versa.

Torque and power are related through angular velocity (or RPM). As the driver or operator of the engine, all you can vary is the RPM. Torque at any given RPM is the characteristic of the engine (built-in into the design and can't be changed by the operator), and the power is the product of the resultant torque and the instantaneous RMP. "Power = Torque x RPM" is the basic equation. So it is a bit incorrect to say that "torque can be varied for a given power". RPM is the independent variable here, torque is dependant on RPM and engine characteristic, and resultant power is the dependaet variable.

[sgiitk]

Yes the taxation on Dlesel is less, and likely to remain so due to the transportation and agricultural lobbies. However, Parikh recommends neutralising this on Cars by an additional duty of Rs.80,000.

[Xehaust]

Abroad, the buying price of a diesel variant of a car is at par or sometimes cheaper than its petrol counterpart.

Till date i havnt understood why manufacturers have priced diesel cars a lot more expensive in India.

But in this case, i think that this is whats going to happen here as well perhaps. They wont make it at par or cheaper, but definitely the price gap between diesel & petrol variants should reduce.

[CoolFire]

IMHO the whole idea of the thread may not materialise very soon. Diesel is still the mode of mass transportation and government will not allow it to come up to petrol levels. They can do this only after subsidising public transport one way or other by any of the following methods
1. by lowering road taxes - which being a state preserve is not very easy
2. by giving direct subsidy - not much likely as the govt. avowed stand is to bring down subsidies
3. By penalising diesel vehicles other than public transportation by way of increased taxes (I pray to God this do not happen, I drive a lot in my diesel car)

[aby]

Sorry to sound a bit patronizing, but I don't understand why people make the crazy assumption that Decontrol of Diesel prices would bring them at par with Petrol prices.

First of all, in India both of them suffer different rates of taxes. In Bangalore Taxes form 45% of the final price of Petrol(Adding Excise, Local Sales tax etc) while the tax rate of Diesel is close to 25%

Deregulation DOES NOT MEAN tax rates will change.

Just that prices will move more in synch with International crude prices.

Indian Govt. will not take the politically suicidal step of increasing the diesel taxes to same level as petrol. Nor would it take the fiscally stupid measure of bringing down the petrol taxes to same level as diesel.

So in short the basic argument of the thread will just not hold true, as price difference between petrol and diesel will continue for the near future.

So if Petrol is still priced 13-16 rupees more than Diesel why should the above mentioned companies be affected.

[Gilead]

Originally Posted by coldice4u

Its early days for the Figo. The P Figo has not been returning very good FE numbers. If such a situation continues only people looking for space and comfort might stick with it. IMHO they should get a powerful and efficient petrol engine. Imagine a Figo with the K-series engine. You ca6n go for it with your eyes closed.

If FE is the sole criteria or the main criteria for buying a small car, the A Star would be selling 20K a month as opposed to 2K. So the common man is indeed looking for space and comfort and not as FE obsessed as we think they are. A car needs to be all rounder like the Wagon R, or the Swift or even the Figo to sell well. The Figo petrol will continue to do decent numbers because it has other positive attributes even if the FE is not the best in the segment.

[anilisanil]

Originally Posted by coldice4u

With the expected deregularisation of diesel prices, the artificial price difference of petrol and diesel will gradually reduce. Petrol is still expected to remain costlier than diesel but the gap will come down very significantly.

Such a scenario will not be desired by several car manufacturers whose product line up places a great emphasis on diesel economy. As diesel cars usually carry a price premium of atleast a lakh over their petrol counterparts, the advantages of these primarily diesel hatches will be significantly reduced. Unless these hatches have a competitive petrol engine, they might find the going tough, with sales reducing considerably.


Thus manufacturers who might have never offered good petrol engines ,might be forced to offer world-class petrol engines. Also agreed that folks who do high mileage might still stick with diesel. People on the forum recommended that diesel cars make sense when one had a daily driving of 30 kms or more. Once that figure gets revised, some of the diesel crowd will no longer find diesel as appealing and will be more than happy to shift to petrol.

Nice topic coldice4u! However, aren't you assuming that the price difference between petrol and diesel is only because the manufacturer wants to put a premium on it?

I don't think so. Diesel engines are more expensive because of the precision levels required to manufacture them. Read some where that the cast of a diesel engine is corrected upto thousandth digit where as for gasoline it is hundredth digit.

Also, diesel requires a lot more stronger parts and bearings for obvious reasons. If you were a manufacturer with so much competition around would not you want to eat into swift's market by not putting a premium on your diesel engine?

Experts- correct me if I am wrong!

[pacman2881]

While I doubt if diesel will infact cost the same as petrol in a country like ours, assuming it does happen this is what I think would happen-

IMO existing manufacturers are making greater margins on diesels over and above the extra cost of producing the diesel due to the skew in sales towards diesels and they will have to forego the extra margin to reduce the price difference between petrol and diesel cars.

Future plans of all manufacturers will be affected- Hyundai's new diesel plant and i10 diesel, upcoming Toyota Etios diesel option, Chevrolet Beat's diesel option, SX4 diesel to name the major players.

Another area where I feel the impact will be huge will be among SUVs as they are relatively less efficient. Currently people would choose for instance an Endeavour over the CRV for fuel costs will go with the CRV. This might even tilt the balance towards sedans in the same price range among buyers who are to decide between a sedan and an SUV.

But then, as I said all this are on assumption that the petrol and diesel cost the same which is unlikely.

[coldice4u]

Originally Posted by aby

Sorry to sound a bit patronizing, but I don't understand why people make the crazy assumption that Decontrol of Diesel prices would bring them at par with Petrol prices.

First of all, in India both of them suffer different rates of taxes. In Bangalore Taxes form 45% of the final price of Petrol(Adding Excise, Local Sales tax etc) while the tax rate of Diesel is close to 25%

Deregulation DOES NOT MEAN tax rates will change.
So if Petrol is still priced 13-16 rupees more than Diesel why should the above mentioned companies be affected.

Diesel as i had said before will never be priced at par with petrol, will always remain cheaper than petrol. However as fuel prices have increased, the difference between petrol & diesel prices have remained almost constant as you have stated. But the point of concern is that the percentage difference between diesel & petrol has reduced significantly. As someone had pointed, in 2002 there was a almost 40 % difference between petrol & diesel prices. As of now it stands at approx 20 %. This figure will go down gradually. Thus the advantage of diesel cars also go down.

Originally Posted by Gilead

The Figo petrol will continue to do decent numbers because it has other positive attributes even if the FE is not the best in the segment.

Absolutely agreed as the Figo has its own strong points. However the as you said the key word is decent numbers. Why not get a better engine and get better numbers when the as the advantage provided by your diesel engine gradually decreases?

Originally Posted by anilisanil

Nice topic coldice4u! However, aren't you assuming that the price difference between petrol and diesel is only because the manufacturer wants to put a premium on it?

No, i had already stated in one of my posts that diesel engines are expensive to make.

Originally Posted by Xehaust

Abroad, the buying price of a diesel variant of a car is at par or sometimes cheaper than its petrol counterpart.

I dont think so, in almost all the markets, variant per variant diesel models have always been more expensive than petrol versions.

[volkman10]

SIAM calls upon govt to deregulate diesel prices. See page 4.


Cheers!

[vishnurp99]

Seems to be a pointless thread to me. Diesel deregulation will increase the diesel prices by max 3-4 rs from my understanding. Per litre Petrol would still be costlier by around 15 Rs and hence the economics of diesel car running will stay similar.

The real difference would come if the taxation of petrol and diesel comes at par but government can't do that since it would be harakiri. In case they do this, the current petrol car owners will also find that their other expenses like Food etc go thru the roof. So let's hope (For the sake of petrol and diesel car owners and the vast majority who don't own cars/bikes)that the govt doesn't do any unnecessary messing. Let them deregulate the diesel prices and stop at that .Not that they have a choice.

[iSpoke]

Some interesting excerpts from above PDF,

However, automakers aren’t benefitting from the price policy, according to SIAM. “The government can think of providing subsidies to them [farmers] but we are against any differential diesel prices,” Talaulicar said.

Meanwhile, one of India’s leading energy planning commission members, BK Chaturvedi, was quoted in an April 29 report from Economic Times (India) as saying that the government ought to set up a dual pricing scheme for diesel, with lower prices for farmers.

“In my view, the diesel price should be market-linked and its use in the agricultural sector should be subsidized,” Chaturvedi was quoted as saying on the sidelines of the “Energize India” conference organized by the Economic Times.

A similar idea came to my mind when I first heard about Diesel deregulation a couple of months back. That next time we go to a pump for a diesel fuel, the guy will look for the number plate (yellow or white) and charge you accordingly! But this seems way beyond practical, and opening separate fuel station for private and agri/commercial vehicles is what I would expect once we cleanup all corruption from our country!

[sgiitk]

Ido not think diesel prices will approach or exceed (as they should if the calorific value is a criteria) since the differential excise is not likely to go away in a hurry. However, if and when the prices start converging, I expect the break even point to approach 30,000-50,000km per annum for diesels. So this will obviously impact all diesel car sales in the normal domestic segment.

[julupani]

Actually diesel prices coming anywhere close to petrol prices is not likely to happen in the next 15years in my opinion. And the reason has nothing to do with agricultural subsidy to diesel at all.

Who are the two biggest blocks of users of diesel in the country? Top spot, the Indian Railways, and 2nd spot the trucking industry. These two taken together transport more than 90% of the total intra-nation freight in the country. If prices increase of diesel increase, it will have a massive ripple effect on inflation of all commodities. Something the govt wont want to do at any cost. Any rise in petrol prices doesnt effect the economy much, but not so with diesel.

@ispoke

True your idea about having differential pricing of diesel for commercial and private users is the first obvious solution. But there is nothing in the law that says that a commercially registered vehicle cant be used for private use of the owner. Thus everybody would end up buying diesel cars and registering them commercially while using it as private cars. I think these sorts of things have been tried out in other nations and havent worked. One example that comes to mind is registering your car in London as a city mini-cab attracts lower taxes and levies. Thus you have everything from Ferraris,Lambos and Maybachs registered as minicabs.

[cingsman]

I very much doubt anything of the sort of deregulation of diesel you are talking about is going to happen anytime soon.

National inflation will go through the roof - thanks to mass, food and other essential commodity transports happening on diesel powered vehicles. Widespread politically charged protests, rallies, fasts etc will start happening. Of course, it has been a few months now since both diesel and petrol have been freed from the clutches of the govt. (officially), but the PSU oil companies still have to get in-principle approval of the govt. before they can increase the price by even 1 Rupee. If you are talking about Diesel inceasing by almost 15-20 Rupees, you are talking about inflation in the 5-10% range to add to the 8-9% we already enjoy!

Hypothetically speaking, even if the Diesel price matches the petrol, the car manufacturer's premium will evaporate. But on the other side, diesel cars will still be preferred since they enjoy better Fuel Efficiency. Diesel also burns cleaner - so, I'd go for it if the OEM premiums dissapper.