Rising petrol prices in India could mean big discounts on petrol cars and a big spurt in diesel cars sales

The petrol prices across India have risen, in the biggest price hike ever of INR 7.5 per liter of the golden liquid. While political parties and citizens of the country, opposing the government’s move, plan to take to the streets in protest, board rooms across car makers are expected to be in a huddle, contemplating as to how they can tide over the latest petrol price hike, which has all the trappings of blowing the socks of petrol car sales. Sales of petrol cars are already in the doldrums due to the steep increase in petrol prices and the widening gap between petrol and diesel, with the latter being cheaper by almost INR 34/liter.

2012 Maruti Alto F8D Small Car

As a car buyer, while you would have to choose wisely between petrol or diesel power, depending on your daily running, it is also a time when car makers could offer big discounts on petrol engined cars. So, if you drive for under 450 kilometers a month, a petrol car would still make a bunch of sense for you and while you’re going car shopping, bargaining hard for discounts will further sweeten the deal for you, offsetting the petrol price hike by quite a bit, at least for a year. For instance, two very popular cars in India, the Maruti Suzuki Ritz and the WagonR hatchbacks, are available for discounts as large as INR 50,000.

Similarly, expect more such discounts to be offered across automakers in the coming weeks. On the other end of the spectrum, there could be more migration by customers towards diesel engined cars. Consequently, discounts on diesel cars could become scarce. Also, the waiting period of diesel engined cars, which is already quite high for the popular models could only go up with more and more car buyers choosing diesel engined variants. Even so, car makers in India will be quite a worried lot as the short term outlook looks gloomy.

2012 Honda Brio Hatchback

Many automakers like Honda and Maruti Suzuki have big capacity installed for the manufacture of petrol cars, and these capacities could be unused. Also, the latest petrol price hike is now the third cog triple whammy to have hit the Indian car industry, with the other two negatives being that of rising inflation and rising interest rates, which have already resulted in a slowdown in car sales this year. Despite all this, the silver lining in the latest petrol hike is that more fuel efficient means of propulsion like electric and hybrid technology is expected to become more prevalent in the coming years, gauging by how expensive fuel is getting each passing year.