The country's largest carmaker Maruti Suzuki India (MSI) Tuesday said it will continue to manufacture diesel cars that customers can afford, thus ruling out stopping the production of diesel cars completely.
The cars are set to get costlier with the upcoming BS-VI emission norms from April next year.
The auto major currently sells various cars with diesel powertrains, including S-Cross, Ciaz, Vitara Brezza, Dzire, Baleno, and Swift.
While the bigger cars are likely to continue, the carmaker is expected to pull the plug on small diesel cars in its portfolio.
When asked if the company has decided to do away with diesel cars, MSI Chairman R C Bhargava told PTI: "No. We have said that we will not make diesel cars which we feel the customers will not be able to afford.
He also said there are some diesel cars which customers can afford and the company will make them. "It all depends on the customer, what his judgement is, what the customer will buy or not buy," he added.
Bhargava said smaller diesel cars would become expensive and thus out of reach for entry-level customers.
"The customers will not buy the smaller ones," he said.
He added that with prices going up, no company would be interested in manufacturing small cars with diesel engines.
When asked if he expects the market share of the company to go down with it doing away with small diesel cars, Bhargava replied in negative.
Currently MSI's market share hovers around 51 per cent in the domestic passenger vehicle segment.
He added that the small car market would move towards petrol and compressed natural gas (CNG).
"There will be nobody making smaller cars with diesel engines because nobody's cars will sell. It is not that only Maruti cars will be more expensive than somebody else's cars," Bhargava said.
The cost of converting to BS-VI technology is going to be the same for everybody and in the smaller cars whether it is made by Maruti or by anybody else, the impact on the market will be the same, he added.
"So, if (MSI) can't sell a small car with BS-VI diesel engine then nobody else would be able to sell such a vehicle...the marker will move to petrol or CNG or something else," Bhargava noted.
MSI has recently come out with its own 1.5-litre diesel engine in its mid-sized sedan Ciaz. Other models like Vitara Brezza, Swift, Dzire and Ertiga continue to be powered by a 1.3-litre diesel engine sourced from Fiat.
The company currently gets nearly 30 per cent of its annual sales from diesel cars. In 2018-19, MSI sold a total of 17,53,700 units in the domestic market.
The Bharat Stage VI (BS-VI) emission norms would come into force from April 1, 2020, across the country. The shift would impact diesel cars more in terms of prices with industry experts expecting the prices of such models to go up by about Rs 2 lakh.
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