Are Consumers Buying Diesel Cars?

Jaguar IPACE SUV Electric

Should I Buy A Diesel Car?

Ha!  Only if you have more money than sense and absolutely no love for the planet.  That I fear is the bottom-line.  

Last month I had visited the incredible Himalayas.  It was my first visit to the famed hill station Darjeeling after nearly 30 years.  However, by the time I had reached the 8,000 feet hilltop renowned for its tea, my exuberance had succumbed to the pollution from the diesel vehicles that clogged the narrow way up.  

This is not the first time I have been in this predicament.  My love affair with diesel ended many years ago.  The emission scandal and the subsequent fall-out of diesel with the general public was inevitable.  In fact, it should have happened earlier.  Let me not mince my words ‘good riddance to bad rubbish’.  


Is Diesel Dead? When Are Diesel Cars Going to Be Banned?

Internal Combustion Engine And Air Pollution
Internal Combustion Engine And Air Pollution

I am not alone in recognizing the environmental damage caused by diesel transportation.  A significant majority of consumers feel the same way.  Look no further than the data from the Society Of Motor Manufacturers (SMMT).  It underscores without an iota of doubt the ‘mood’ of the nation in regards to buying diesel cars.  

If that is not bad enough, the announcement of the ban of diesel cars by 2040 is certainly the final nail in the coffin for diesel road transportation.  Moreover the sluggish new car sales market in 2019 has further amplified the challenges facing diesel cars.  


Why Are Diesel Sales Plummeting?

diesel sales falling

Diesel sales have now fallen for 26 consecutive months.  Key reasons for the ‘fall from grace’ include:

The diesel market share reached a high of 56% in 2011, but has now fallen below 30% (27.7% as of May 2019).  The 2015 Volkswagen emission scandal ‘Dieselgate’ marked the beginning of the end. In 2017 diesel sales fell by 17% followed by a further 30% in 2018.  

The evaporation of the diesel market share for new registrations has resulted in an increased market share for EVs in the UK.  This transition is now well underway and it is only a matter of time before diesel market share drops to insignificant levels with electric car new registrations replacing diesel.  


Commercial Emission Free Road Transportation

It is not only passenger cars that are witnessing the fundamental shift in market shares, but the sale of diesel commercial vehicles is also under threat.  The Nissan E-NV200, Renault Kangoo Z.E. 33 and Master Z.E. are good examples of all-electric commercial vehicles at the vanguard of the shift of commercial transportation to zero emissions. 

The UK governments Road to Zero Strategy clearly states its mission as ‘our mission is to put the UK at the forefront of the deisgn and manufacturer of zero emission vehicles for all new cars and vans to be effectively zero emission by 2040’.   


Why Are Electric Cars Better Than Diesel Today?

Jaguar IPACE SUV Electric
Jaguar I-PACE SUV Electric
  • Zero emissions and no Pollution 

Let me start with the most obvious. Pure electric cars also known as battery electric vehicles (BEV), have zero tailpipe emissions i.e. these vehicles do not pollute the air you breathe.  Diesel cars are at the other end of the pollution spectrum.  

Other cities are expected to follow London’s example of introducing the Ultra Low Emission Zone scheme that charges older polluting vehicles like diesel cars up to £12.50 a day.  Electric cars are exempt. 


  • More stable and higher residual values 

Diesel residual values witnessed significant instability and decline post the 2015 emission scandal.  Diesel cars have witnessed higher depreciation rates. Increased rates of depreciation only devalue your investment.   

The ‘death of diesel’ has been further exacerbated by the oversupply in the used car market.  

Though the electric car market is relatively new, the industry has witnessed the stabilisation of depreciation rates, if not, in some cases strengthening. This has resulted in firmer and more attractive residual values for EV buyers.  


  • Lower maintenance costs

Electric cars have significantly lower moving parts compared to internal combustion engine cars like diesel.  Which means, fewer things can go wrong with electric cars compared to diesel cars.  EVs are cheaper to maintain.


  • Lower taxes and other fees

The vehicle excise duty (VED) on 100% electric cars is zero. While diesel vehicles have increased by one band.  


  • Smoother drive, less noise and better acceleration 

Maybe it is just me.  But every time I sit in a diesel vehicle, I feel nauseated.  I suspect I am not the only one.  Maybe it is the lingering smell of diesel or just the way the vehicles drives. Either way, it is not fun. Moreover, the noise from a diesel internal combustion engine further dampen the experience.  

It is a fact. EVs are smoother to drive.  The other day I drove the new all-electric Audi e-tron.  I could not get myself to accept that my test drive had come to an end!  The cabin is silent.  Even the very softly spoken car salesperson on the passenger seat was easily audible. 


  • Cheaper to recharge an EV Battery than to fill a full tank of diesel 

Simple math’s.  A tank of diesel costs between £50 to £90.  A full recharge of an electric car battery costs between £3 and £5.  


Electric Cars Are A New Chapter In Automotive Transportation 

Yes, diesel is dead and the eulogy has been delivered.  Phew! Let me labour this point again.  Only fools will buy diesel.  Be smart, use your hard earned money judiciously and buy a low emission vehicle.  Above all, leave a legacy of a cleaner less polluted planet for your children and grandchildren.  Happy electric driving!


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Author

Ashvin Suri

Ashvin has been involved with the renewables, energy efficiency and infrastructure sectors since 2006. He is passionate about the transition to a low-carbon economy and electric transportation. Ashvin commenced his career in 1994, working with US investment banks in New York. Post his MBA from the London Business School (1996-1998), he continued to work in investment banking at Flemings (London) and JPMorgan (London). His roles included corporate finance advisory, M&A and capital raising. He has been involved across diverse industry sectors, to include engineering, aerospace, oil & gas, airports and automotive across Asia and Europe. In 2010, he co-founded a solar development platform, for large scale ground and roof solar projects to include the UK, Italy, Germany and France. He has also advised on various renewable energy (wind and solar) utility scale projects working with global institutional investors and independent power producers (IPP’s) in the renewable energy sector. He has also advised in key international markets like India, to include advising the TVS Group, a multi-billion dollar industrial and automotive group in India. Ashvin has also advised Indian Energy, an IPP backed by Guggenheim (a US$ 165 billion fund). He has also advised AMIH, a US$ 2 billion, Singapore based group. Ashvin has also worked in the real estate and infrastructure sector, to including working with the Matrix Group (a US$ 4 billion property group in the UK) to launch one of the first few institutional real estate funds for the Indian real estate market. The fund was successfully launched with significant institutional support from the UK/ European markets. He has also advised on water infrastructure, to include advising a Swedish clean technology company in the water sector. He is also a member of the Forbury Investment Network advisory committee. He has also been involved with a number of early stage ventures.

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