India’s increasingly strict norms for diesel engines hasn’t waned demand, said Tadashi Asazuma, executive vice president – sales and customer service, Toyota Kirloskar Motor, said in a press interaction on Thursday. Speaking at the launch of Toyota Hilux — the latest entrant in its Indian fleet — Asazuma has said that the company will not look beyond diesel engines as long as the demand is viable.

Asazuma has also added that Toyota’s diesel engines can also keep up with India’s norms—with its current diesel engines in the Indian market being well within the emission limits under Bharat Stage (BS) VI norms. “Our 2.5-litre engine is at par with petrol or CNG engines,” Asazuma has said, adding that the company currently has no plans to launch the Hilux with a petrol engine in India. “Given our customer demands and the business environment in India, we’re currently not looking at a petrol Hilux.”

India implemented the much stricter BS-VI norms amidst the nationwide lockdown in 2020. A BS-VI compliant engine will have to reduce its nitrogen oxide emissions by 68% from the BS-IV levels, whereas hydrocarbon + nitrogen oxides emissions will have to reduce by 43%. The National Green Tribunal (NGT) has also imposed a ban on diesel vehicles older than 10 years. However, the Delhi government has allowed older diesel vehicles on roads if they are converted to electric.

Tightening emission norms for diesel vehicles has led to many manufacturers withdrawing their diesel portfolio in India altogether, for the cost that is incurred for making engines BS-VI efficient, when juxtaposed with the demand for diesel, does not make a feasible choice.

Toyota—known for making reliable diesel engines with a long life expectancy—also decided to pull the plug on its mass-market diesel-powered vehicles in 2019. Although Toyota’s sales are diesel centric—with 60-80% sales made by the company for its diesel-powered, large utility vehicles Innova (an MPV most commonly used as commercial taxis for long-distance travel) and the Fortuner SUV. Toyota’s current two offerings for the lower, mass market strata are rebadged, gasoline-powered models from Maruti Suzuki—which has the lion’s share in the strata.

India’s leading carmaker, Maruti Suzuki, ceased manufacturing its diesel-powered cars in April 2020, before the BS-VI norms were implemented. It also refuted speculations that it is attempting to reincarnate its diesel-powered fleet in November last year. "We are not going to be in the diesel space. We had indicated earlier that we will study it and if there is customer demand, we can make a comeback. But going forward, we will not be participating in the diesel space," CV Raman, chief technical officer, Maruti Suzuki India, told a news agency.

The second-stage of BS-VI norms, when implemented in 2023, will further dwindle the demand for diesel-powered cars, according to Maruti Suzuki. “In 2023 the new phase of emission norms will come which is likely to drive up the cost. So, we believe that diesel percentages may further come down. We do not know about the competition but as MSI we do not have any intention to participate in the diesel space," Raman added.

French carmaker Renault had also announced that it will stop manufacturing diesel-powered cars by the end of 2019. The move came on the back of economic viability concerns, and also alluded that the technology poses certain risks in BS-VI testing. "We don't want to take the risk, we want to be clear and want to do away with the borderline cases of BS-VI," Venkatram Mamillapalle, the country CEO and managing director of Renault’s India operations told reporters. Renault’s diesel-powered sales only amounted to 4,000-5,000 vehicles.

Toyota has launched its flagship, India-bound Hilux (globally, its sales have surpassed 20 million units), hoping to tap into the niche, unexplored yet growing market for lifestyle pickup trucks—where it currently is only rivalled by Isuzu. Its price will be revealed in March, and Toyota hopes to start making deliveries from April.

When asked whether the ongoing semiconductor crisis and pandemic-induced restrictions could possibly lead to an inordinate delay in deliveries, Wiseline Sigamani, the general manager of strategic business unit at Toyota Kirloskar, said that the company is liaising with all the stakeholders to mitigate the industry-wide problem, and the company remains optimistic about 2022.

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