India Markets closed

Is Maruti saying bye to diesel? Not entirely

Maruti Ciaz 1.5l diesel

The biggest automobile news doing the rounds in India is, of course, that Maruti will phase out diesel cars by 2020. But then, this should not be a shock to the informed. Let me explain why.

April 2020 is when the BS6 norms kick in and that means since all of the current Marutis — barring the Ciaz — powered by the 1.3l Multijet diesel from Fiat, would not be meeting these strict norms. Thus, that diesel engine would need to be phased out.

However, Maruti’s statement pertains to small capacity diesel engines. It is clear that BS6 will mean the death of the small capacity diesel engine. To make diesel engines BS6 compliant would make them expensive and in the small car segment, where cost is paramount, it would automatically make them more expensive for customers. This would imply that the diesel variants of the Swift and the Baleno diesel would stop production and Maruti will stop giving any diesel engine option for its small cars.

Cars like the Baleno diesel would be stopped not the bigger cars

However, recently an all new 1.5l diesel has been launched and that has been developed by Maruti. This engine is BS6 ready and has been launched in the Ciaz currently. Also do note that the Maruti Brezza, which is amongst its highest selling cars, is available only in diesel. In the SUV segment, diesel engines are still in demand. Additionally, cars such as the Ertiga, too, have demand in diesel variants. To give up on that market would have a huge impact on Maruti sales and that, surely, is not going to happen.

So, here’s what we can expect: Maruti’s new 1.5l diesel will continue to power its bigger cars  Maruti’s bigger cars (mainly the Ciaz, Ertiga and S-Cross). Of course, making the 1.5l diesel for BS6 will mean an increase in costs but demand for diesel is still there in the SUV space where the Brezza operates and dominates.

So while further clarity is awaited, Maruti is likely to now entirely give up on diesel. Small diesel cars like the Swift or Baleno or Ignis will face the axe, but the larger models may still have diesel variants.  From the perspective of both economics and environment, a BS6 diesel engine is relatively cleaner and not as evil as it is made out to be. Maruti will certainly not give up that market and gift it to its rivals.