Diesel might retain the charm even after the Price Hike

Published On September 20, 2012 By at Gaadi

Diesel prices has been increased by Rs. 5 and this has given a set back to the diesel car owners. But will there be any drop in the popularity of diesel run cars? The answer to this question could clearly be a no and diesel will retain its charm as a recent finding stated that running cost of a diesel car against a petrol one stands significantly lower even on the new diesel rates. According to a report published in Times of India, diesel has proven to be pocket friendly even after the price leap.

According to this analysis between the two, the per km cost of petrol car came out to be Rs 4.89, and for running a diesel car, it’s only Rs 2.47 this makes it almost double for the petrol car.

diesel price

Diesel Price Hike

The study included hatchbacks and entry-level sedans, with petrol versions delivering mileage of 14 km/liter and diesel giving19 km/liter. The study revealed that while diesel is more budget-friendly whereas petrol prices hike has resulted in a broader break-even time for recovering the additional price individuals pay. For a diesel vehicle it is of Rs 1.2 lakh on an average which has gone up by a few months.

If an individual drives for 1,000 km per month, estimated break-even time for this will rise to four year and a month’s time from the earlier three years and six months time period. For those who driving 2,000 km per month the figures are even better. It will be from about a year and nine months earlier to only a few days over two years.

Market analysts and players hence feel that the hold of diesel on the emerging diesel powered passenger car market will not be much affected.

"While there may be a minor shift in the diesel-petrol ratio, the overall impact won't be much. There may be some shift for petrol cars only in the small car category, but this not for big cars, utility vehicles and SUVs," said Pawan Goenka, president, Automotive division of Mahindra & Mahindra.