Wednesday, September 13, 2023
By Kamal Swami
Carmakers Reaction On Phasing Out of Diesel Engines
The recent statement from the Union Minister of Road and Transport Nitin Gadkari," that diesel engines may soon attract 10% pollution tax" has grabbed the attention of all major carmakers in the country. According to reports, the carmakers are taking this statement as a hint for shifting to alternative fuel and electrifying their portfolio. Commenting on the statement carmakers said, the production of diesel vehicles may come down with the implementation of strict emission norms.
It would be interesting to know that carmakers like Mahindra & Mahindra, Kia Motors, Honda Motors, and Tata Motors are major manufacturers of diesel vehicles, followed by Mercedes-Benz and BMW in the luxury cars segment. Addressing the annual convention organized by the Society of Indian Automobile Manufacturers (SIAM), the Union Minister of Transport said, "the need to levy an additional 10 per cent tax on diesel engines to help cut emissions".
However, he also made clear that at present there is no official proposal regarding this. This has created a fuss among major carmakers. Commenting on this, R Veejay Ram Nakra, CEO of the Automotive Divison Mahindra & Mahindra said, "Such a move will certainly have an impact on the volume of sales". On the other side, Shailesh Chandra, M.D of Passenger and Electric Vehicle Mobility at Tata Motors said, "We will continue making diesel vehicles till there is demand".
Tarun Garg, COO at Hyundai Motors India, said, "The transition to cleaner fuel has already started. However, it will take time to complete". Speaking about Gadkari's statement, he said, “We have always believed that it is the government's job. We will do whatever the government want us to do, and we have always complied with all the laws of the land". The Indo-Japanese carmaker and the country's leading car manufacturing company MSIL think that there will be a decline in the number of diesel vehicles in the coming future. According to the sources of the company “It is a natural phenomenon that as the emission regulations keep tightening, the cost of acquisition will keep increasing, and this process (decline in diesel vehicle percentage) will be much faster going forward".
Reacting to Gadkari's statement, Santosh Iyer, Managing Director at Mercedes Benz India, said, “We will need six-odd months to change our production planning processes but we can always vary and shift based on the demand.”