Petrol-diesel price gap decrease to hasten shift to petrol PVs: ICRA

A decrease in the gap between petrol and diesel prices is likely to accelerate the shift towards petrol or CNG passenger vehicles in the coming years, an ICRA analysis showed on Wednesday.

Accordingly, diesel PV’s share is expected to decline to 15-18 per cent in FY2022 from 29 per cent in FY2020.

“Within this, the share of diesel vehicles in the car segment will stabilize around 5-7 per cent (from 11 per cent) whereas UV segment’s share will gradually reduce to sub 40 per cent (from 65 per cent) over the next 2-3 years,” the report said.

“The entry-level segment (sub Rs 5 lakh price segment) has almost entirely shifted to petrol or CNG, as it doesn’t make financial sense for an average car buyer to opt for diesel vehicle.”