Diesel still going strong in cars priced over ₹10 lakh: Kia India

Sales of diesel-powered vehicles costing over ₹10-lakh are still going strong as buyers choose this powertrain for better fuel efficiency and torque on highways, according to Hardeep Singh Brar, senior vice-president and head of sales and marketing, Kia India.

“What customers like in diesel is fuel efficiency because they drive a lot on highways... The second big thing which they don’t find anywhere is torque that diesel gives. On highways, you need instant torque to overtake. These are the big factors which are missing in CNG, hybrids. They don’t give you instant torque,” says Brar.

Even though several companies have stopped making diesel cars, Brar says diesel is more beneficial in meeting CAFE (Corporate Average Fuel Efficiency) norms. “From an OEM (original equipment manufacturer) perspective, diesel is important because CAFE norms give more weightage to diesel than petrol cars,” he says.

CAFE norms, which are calculated on the total fleet of an automaker, aim to reduce fuel consumption by vehicles and lower carbon dioxide (CO2) emissions. CAFE II norms, which came into effect on April 1, 2023, require average corporate CO2 emissions to be less than 113 g/km.

Diesel car volumes for the industry have been stable at 17-18% for last four years, including this year, says Brar.  For Kia’s mid-size SUV Seltos, diesel contributes about 35% to total sales. In compact SUV Sonnet, diesel accounts for about 25% of sales. “We will go with the customer demand and we will supply as per their preference,” says Brar.

On compressed natural gas (CNG), Kia India chief sales officer, Joonsu Cho says the carmaker is studying the technology. “We have asked our R&D centre to study CNG. It is being thought about at our R&D centre,” he says. “Diesel has grown a little while gasoline has de-grown. We are studying all possibilities including hybrid,” Cho adds.

Kia India plans to sell 250,000 cars in 2024. For the next year, the South Korean carmaker is targeting 300,000 units. On Thursday, it launched compact SUV Kia Syros to enhance its product portfolio in the sub-4 metre segment which is roughly 8-8.5 lakh units annually. “The average growth rate of this segment has been close to 12-13%. I think next year, if all goes well, it could be 9-9.5 lakh, at least, minimum 10% growth is a bare minimum that you can see because we have seen SUV segments are growing every year, even in this year, which is otherwise a very muted year with 3-4% growth,” says Brar.

Kia is a significant player in India’s SUV market, clocking a share of 15%. “With Syros coming in next year, we expect to go this to 20%,” says Brar.