Car companies line up to launch new diesel variants

Car companies are gearing up to launch about a dozen diesel-fuelled models. Hyundai Motor India plans to boost its portfolio of the diesel-powered i20, Verna and Santa Fe with the Elantra by September. Also on the cards are multi-purpose van Evalia from Nissan, alliance partner Renault’s sports utility vehicle Duster, homegrown auto major Mahindra & Mahindra’s mini-Xylo and a compact version of the sedan Verito.

Lowell Paddock, president and managing director, General Motors India, says, “The market has slumped but we are preparing to build volumes with three new launches this year, all of which would come in diesel options as well. Diesel models are selling, so the only way is to offer customers more choice here. The Sail hatchback and sedan would replace the Aveo and the Aveo U-VA, which come only in petrol options and are not doing that well. Except for the Spark, all our products would come in diesel variants by the end of the year.”

According to industry estimates, Indian car makers increased production capacity of diesel vehicles by over 35 per cent to 1.16 million units in the last financial year, compared to the year-ago period. Petrol vehicle manufacturing capacity in the domestic industry was rationalised by 12 per cent to 1.75 million units during the same period.

“Most manufacturers have already executed changes in production lines and are now more prepared to meet the demand for diesel cars. The overall sentiment continues to be negative at a time when availability has improved,” says Shashank Srivastava, chief general manager (marketing), Maruti Suzuki India.

Maruti Suzuki has seen success with the newly launched utility vehicle Ertiga, which currently has a booking of over 47,500 units. Over 87 per cent of Ertiga sales are coming from the diesel variant, Srivastava says.

As diesel models are on offer in the premium hatchback segment, the number of first-time buyers in the category has increased to 46 per cent from 24 per cent in the last two years.

Arvind Saxena, director (sales & marketing), Hyundai Motor India, says, “Diesel vehicles used to contribute 16-17 per cent to our overall volumes till a year back. Now, the proportion has gone up to over 28 per cent. The market is slowing down and because of the price difference between the two fuels whatever sales are happening are mostly of diesel variants.”