As total deregulation of diesel prices gets closer to reality, automobile manufacturers say that there is a shift in preferences from diesel variants to petrol. Japanese automobile maker Honda Cars India Limited said that they are already witnessing this shift. Speaking to reporters after unveiling the companyâ€™s multi-purpose vehicle (MPV) Mobilio, Jnaneswar Sen, Senior Vice-President (Marketing and sales) of the company said that currently they have 70:30 for diesel. But there is a visible shift being seen, he added.
The process of diesel deregulation was initiated by the UPA government last year with up to 0.50 paise per month (per litre) increase of diesel price to reduce the subsidy burden. According to ratings agency Moodys, the subsidies loss (under-recovery) is said to total Rs 1,10,000 crore in the current fiscal (FY15). According to experts, out of all cars produced in 2013, 47% were petrol and 53% diesel. Honda entered the diesel variant space in India with the launch of Amaze and since then have launched City and Mobilio in diesel variants.
But many others in the industry believe that even with the difference between the two fuels gets smaller, diesel variant models will still cost more as they are known to be more fuel efficient.