BS7 Emission Standards Threaten Diesel's Dominance in Indian SUVs
BS7 norms may finally end diesel's last stronghold in Indian SUVs
The Economic Times
Image: The Economic Times
While diesel remains popular among SUV enthusiasts in India, the upcoming BS7 emission standards could significantly increase costs, potentially ending diesel's stronghold in the market. Major manufacturers like Mahindra & Mahindra are diversifying their offerings amid shifting consumer preferences and regulatory pressures.
- 01Diesel's market share in passenger vehicles has dropped from 47% in 2012-13 to around 18% now.
- 02The introduction of BS7 emission standards is expected to raise compliance costs significantly.
- 03Mahindra & Mahindra continues to see strong demand for its diesel SUVs but is diversifying its powertrain options.
- 04Luxury SUV buyers are still opting for diesel for its performance despite the shift towards electric vehicles.
- 05Industry experts predict that increased diesel prices could push buyers towards alternative fuels.
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In India, diesel has maintained a steady market share of around 18% in passenger vehicles, primarily among SUV enthusiasts. However, this could change with the introduction of the BS7 emission standards, which are expected to raise compliance costs significantly, with estimates suggesting price increases of ₹30,000 to over ₹1 lakh per vehicle. This regulatory shift may challenge diesel's position, particularly among price-sensitive buyers. Mahindra & Mahindra, which has seen strong demand for its diesel models like the Scorpio and Thar, is now diversifying its portfolio to include electric and hybrid options. Luxury SUV manufacturers, such as Mercedes-Benz India, report that over 50% of their sales come from diesel models, driven by performance and total cost of ownership. As the market evolves, the future of diesel in India hinges on whether loyal customers will accept higher prices or shift to alternatives like CNG or electric vehicles.
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The increased costs associated with BS7 compliance may lead buyers to reconsider their choice of diesel vehicles, impacting sales and market dynamics.
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