As crude prices accelerate at full throttle, petrol is set to lose
ground as the auto fuel of choice. Automobile majors in India are
looking forward increased sales of diesel and alternative fuel
vehicles in the near future.
Diesel and auto-LPG-driven models are currently available in almost
all ranges of cars, but have found few takers due to performance and
fuel availability.
However, with petrol prices soaring, consumers are expected to be
tempted by the economic advantage these vehicles offer.
"Initially, the fuel price hike may hit the automobile sector as far
as sales are concerned. However, in the longer run, this decision is
likely to force customers to switch from petrol to diesel," said one
Tata Motors official asking not to be identified.
This person added: "It is too early to predict the figures. Now,
unlike before, customers do not hesitate to go in for diesel or any
other convenient option, such as LPG or CNG. Since most car companies
have a presence in both segments - petrol and diesel -customers are
likely to switch from petrol to any other model."
This spillover effect will not stop, meaning that the used car market
will also be affected simultaneously.
"The secondary market also has a prominent existence in the automobile
sector, especially in a market like Ahmedabad. When a consumer buys a
car from a secondary market, obviously his first concern is saving
money. So, with fuel prices rising indiscriminately, consumer will
naturally choose diesel, LPG or CNG models" said a city based
secondary car dealer, asking not be identified.
"As of now, most customers are interested in petrol models as they are
very comfortable with the performance, but after the increase in fuel
charges, we expect this to enhance diesel and LPG models in the
future," Satish Shah, GM, Maruti True Value, said.
"Petrol cars which give a two-digit average will not be affected as
much. Cars which are not as fuel efficient will be affected to a large
extent as they lead to higher expenses, compared with diesel-run cars.
So, it is but natural that customers will choose options like diesel-
run models, which are economically convenient, as well." said Ajit
Mehta, GM Infinium Toyota.
"As far as LPG and CNG models are concerned, buyers initially prefer
to go them but, over time, performance could become an issue. So,
ultimately, they don't have any other option rather than going in for
a diesel model," he added.
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