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More Tax On Diesel Cars Will Harm Us All
The diesel car tax has shocked the auto sector. At a time when demand for diesel cars has sky rocketed, the carmakers have become heavily dependent on diesel car sales. Even carmakers who previously did not have too many diesel cars are now adding diesel engines to their petrol cars just to satiate this demand.
Mahindra and Mahindra, the country's leading SUV manufacturer has come out strongly against the diesel car tax. It has stated this tax would be hamper the growth of the auto sector. Mahindra has argued the government's idea that much of the subsidized diesel was consumed by luxury cars. It has stated that only 0.2 per cent of the diesel was used by such vehicles.
Mahindra and Mahindra boss Dr Pawan Goenka in his statement said : “ In my opinion to consider an additional tax on diesel vehicles is a retrograde step. In the upcoming union budget this is perhaps the most critical item for the automotive industry which will have a significant impact on the growth of the industry in the upcoming fiscal year."
The Society of Indian Automobile Manufacturers has also stated that not more than 22 per cent of passenger vehicles sold in India use diesel engines. The argument that diesel is used by most by luxury cars has also been pushed aside by Mahindra.
Mr Goenka said the car industry will suffer a body blow if a diesel car tax of such magnitude is imposed. Car sales have been slow this year and the SIAM has even said there could be a possibility of a sales slide in 2011-12.
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