Auto cos say making diesel tech affordable under BS-VI norms a challenge.
New diesel vehicles are set to pinch a lot more once the next generation emission norms are implemented in 2020 even as carmakers scramble to make petrol vehicles equally fuel-efficient.
Vehicle manufacturers state that the technology required to reduce nitrogen oxide (NOx) and particulate matter (PM) in diesel emissions will be very expensive to use and will further increase the pricing gap between diesel and petrol vehicles.
“The most challenging part under BS-VI will be making diesel technology affordable. Carmakers will have to invest keeping in mind the affordability levels of the consumer and return on investment,” said a top executive from Maruti Suzuki, the country’s largest car maker speaking to Moneycontrol.
India is set to adopt Bharat Stage (BS-VI) norm, which is pegged as the single biggest sweeping reform in emission standards, from April 1, 2020 for all vehicles (existing and new).
With its successful implementation India will be the first country in the world to skip an emission standard (BS-V) totally to move on to the next. The country is presently under BS-IV which got implemented across from April 1, 2017.
Srinivas Aravapalli, Vice-President and Head of Vehicle systems, Mahindra & Mahindra said, “Fundamentally, the NOx emissions and particulate matter are the highest in diesel vehicles. Diesel is very fuel-efficient but these two irritants are a little complex to reduce. As everyone knows petrol is nowhere as fuel efficient as diesel. So, in diesel, there are technologies to bring down the NOx and PM but those technologies are a little expensive but it is not that it is not possible.”
BS-VI NOx and PM emission limits for light-duty (weighing less than 3500kg) diesel vehicles are considerably lower than BS-IV levels. NOx emission limits are reduced by 68 percent relative to BS-IV levels, though remain between 33 percent and 52 percent higher than BS-VI emission limits for corresponding light-duty gasoline vehicle classes. PM emission limit reductions vary by vehicle class and range from 82–93 percent.
Diesel cars presently charge a premium ranging from Rs 1 lakh to Rs 1.6 lakh depending on the segment and the manufacturer. The diesel base variant of the Tata Nexon, for instance, is priced exactly Rs 1 lakh more than the petrol base variant. The pricing gap for the industry will most likely increase further to Rs 1.6-2 lakh under BS-VI.
With some new generation petrol-powered cars like Tata Tiago, Maruti Suzuki Celerio and Renault Kwid giving a mileage of 23-25 km per litre, they are on par with diesel counterparts, which cost at least Rs 1 lakh more and are also expensive to maintain.
Diesel cars have already started to lose the flavour with consumers. At the end of the last financial year diesel share in overall passenger car market dipped to a new low of 37 percent from as high as 80 percent about six years ago. Not only are petrol cars cheaper they are cheaper to maintain, too. In some cases, petrol cars are nearly as fuel-efficient as diesel counterparts.
“We have to hope that consumers will not give up diesel. Overall penetration (passenger vehicle and commercial vehicles) should be 50:50. The industry will likely adopt hybrids and electrics but certainly the dependence on diesel will reduce substantially post 2020,” added Aravapalli.
Mumbai-based Mahindra & Mahindra, which has had a diesel-heavy portfolio in the past, is readying at least three new petrol engines all of which will be launched before 2020. All of its current offerings including Scorpio, XUV 500, Bolero and TUV 300, will have a petrol option soon.
“We have launched the 1.2 litre (in KUV100); in a year we will have 1.5 litre and within the next two years we will launch the 2.0 litre. We are also readying the 0.660 litre compact petrol engine for the Jeeto, which is our small commercial vehicle,” said Rajan Wadhera, president (automotive sector), M&M.
Tata Motors is not far behind. Under the new family of Revotron and Revotorq engines the company has built a platform that can meet the BS-VI regulations with ease. Outgoing head of product development Tim Leverton said to Moneycontrol earlier, “The new family of engines we are developing can meet the BS-VI regulations as well so there is no question about possibility there. Cost-wise we have to see how to meet the challenge”.
Small car specialist Maruti Suzuki is also working on planting petrol engines in those vehicles which only have a diesel powerplant at present. The Vitara Brezza and S-Cross are two such cars which do not have a petrol option at present.
A few months ago Maruti discontinued the diesel variant of the Celerio, owing to lack of demand as more than 80 percent sales were emerging from the petrol variant.“We did not put a petrol engine in the Brezza and S-Cross because the power delivery required for them most suitably came from diesel. But we know the consumer demand and we are working on having petrol engines for both,” added the senior executive.