The sales of diesel cars in India are witnessing a slowdown in response to the increase in diesel fuel price. The sales of diesel cars decreased to 33 percent of the total cars sold in India in the period October-December 2013 in comparison to 40 percent in the same period in 2012.
The total diesel cars sold in the October-December 2013 period totaled 88,000 units against 1,07,000 units in the same period in 2012. A similar trend is being witnessed by carmakers for car models with both petrol and diesel fuel options.
Forecasting the shift in preference from diesel to petrol fueled cars, Indian automaker Tata Motors whose majority of the car models in its portfolio are diesel powered, has introduced the Revotron petrol engine option with the aim of attracting car buyers with the preference for petrol fueled cars.
Since the deregulation of the diesel fuel, the price of diesel fuel has been increasing by about Rs 0.50 every month. The price of diesel fuel has increased from Rs 41 per liter in May 2012 to about Rs 55.5 per liter in March 2014. This has affected the preference for diesel powered cars and is gradually effecting a demand shift back towards petrol cars in India.
