Carmakers Favouring Petrol Vehicles As Customers Prefer Them

Car manufacturers are favouring production of petrol engined vehicles as customers are preferring them too, as fuel price difference is narrowing over time.

Low price difference between fuels and costlier diesel powered vehicles have made customers chose petrol vehicles over diesel vehicles.

Carmakers are finalising production plans for 2015 and are planning to manufacture more petrol vehicles compared to diesel powered vehicles.

Petrol vehicles, in terms of sales has increased over the past few months. Around 58 percent of domestic car sales are petrol vehicles. This number is expected to reach 60 percent if this trend is to continue.

Until almost a year ago, diesel vehicles had a much higher demand compared to petrol vehicles. The government subsidy encouraged carmakers to manufacture more diesel vehicles.

Vehicle manufacturers who focus more on diesel vehicles took the biggest hit due to the changing trend of customers opting for petrol vehicles.

Manufacturers like Mahindra, who primarily manufacture diesel vehicles, saw sales drop up to 20 percent during the FY 2014.

Other manufacturers like Tata Motors is witnessing an increase for petrol vehicles, the newly introduced Revotron engine to be specific.

Honda was forced to introduce diesel engines to keep up with the market trend, but now the company is being flexible with customer demands.

One major fact toward decreasing petrol prices is the cost per barrel in the international market and the government deregulating diesel prices in India.