PLUNGING petrol prices and Volkswagen’s emission scandal has put diesel cars on the nose, slashing sales to 20 per cent of those in 2010.

The change in private buyer habits has already hit car-makers, with many dropping some diesel models – including oil-burning stalwart Audi, who no longer offers a diesel in its mid-size A4 Avant wagon and has only one diesel in the sedan range.

Mazda has recently dropped its Mazda3 diesel, Honda no longer has a diesel Civic and the diesel Holden Cruze has been retired.

The ongoing effect is now likely to influence used-car values and valuations on diesel cars ending their lease period.

But it’s not just in Australia. The UK, which has long supported diesel passenger cars over petrol variants because of the fuel economy benefits, is also reporting more interest in petrol cars.
Whatcar.com in the UK said a survey of prospective new-car buyers showed 84 per cent would opt for petrol over diesel.

In Australia, the slide in the sales of diesel-fuelled passenger cars has been unbroken since 2010.

In 2015, diesel car sales to private buyers fell 28.1 per cent, a drop of 1655 vehicles compared with 2014 that was also a negative year for these cars.

In 2010, diesel cars jumped 47.3 per cent in sales for the year. The sudden rise in diesel cars sales in 2010 was caused by the rising petrol prices, moving from an average in 2009 of 102.3 cents a litre across Australia to 126.3c/litre in 2010 and 141.2c/litre in 2011.

But by 2012, petrol prices had stabilised at 149.3c/litre and buyers pulled back from committing to a new diesel car. Sales in 2012 for diesel cars fell 2.2 per cent.

At the same time, manufacturers started an intense engineering program to downsize engine sizes and add turbocharging to increase performance of petrol engines – notably the Ford 1.0-litre three-cylinder turbo-petrol and the 1.4-litre four-cylinder turbo-petrol used across the Volkswagen Group.

These engines showed modest fuel consumption that closed the gap on their diesel rivals and buyers showed a preference to petrol-engined cars because of their lower purchase price, lower service costs and less-messy refilling operations.

Buyers are also concerned about the emission (and therefore fuel consumption) data being advertised by diesel car-makers. This follows revelations in 2015 of Volkswagen cheating on emission level testing, with some actual driving recordings to be up to 40 times the nitrous-oxide levels of the figure advertised by VW.

It has led to international condemnation of Volkswagen’s testing procedures, potentially multi-billion-dollar legal actions against the company, the demand for the replacement of the affected cars and a backlash by European and US consumers.

Whatcar.com said more than 84 per cent of the car buyers that it surveyed were worried about possible legislation changes against diesel cars.

It reported that buyers thought these changes could affect the future cost of ownership of diesel cars, including the purchase and resale price, fuel tax, and vehicle road tax.

The survey found that the two most important factors for car buyers were engine performance and fuel economy.

“Buyers appear not to be overly concerned about environmental factors,” Whatcar.com noted.

“Car buying is usually determined by the financial aspects of the purchase; if buyers fear a diesel crackdown and petrol engines are cheaper to buy while being almost as efficient, it’s easy to understand the changes taking place.”

The research also showed that hybrids and electric cars are even less tempting for prospective car buyers.

“While between 12 per cent and 32 per cent of buyers would consider diesel or petrol hybrid vehicles, more than 48 per cent of buyers would be very unlikely to consider an electric car,” it said.

“This backs up the fact buyers are less concerned about being green.”

 

By Neil Dowling