Honda foresees continued demand for diesel cars in India

Honda Cars India will continue its diesel engine program for India and is in the process of upgrading its 1.5-litre i-DTEC ‘Earth Dreams’ diesel engine to meet BS VI emission norms which comes into effect across India, in 2020.

The high cost of upgrading diesel engines to make them BS VI-ready has altered a few carmakers’ engine strategies in India. Volkswagen, for one, will not upgrade its 1.5-litre EA189 engine to meet the emission norms and the eventual roll-out of BS VI norms will also sound the death knell for Fiat’s ubiquitous 1.3-litre Multijet engine.

When asked by Autocar India if Honda ever considered abandoning diesels for India, Yoichiro Ueno, president and CEO, Honda Cars India, replied, “In Tier 2 and Tier 3 towns, the demand is fully concentrated towards diesels. To meet customer demand, we have to offer diesel.”

However, Ueno also said that the upgrades to the diesel engine will be costly and could push the price of diesel cars, by a significant figure. “BS IV is a challenge. Especially for diesels, the particulate matter (PM) regulation is very strict. We need very defined PM filters and that effects the cost of the diesel upgrade,” said Ueno. The head of Honda’s car operations in India also suggested, as a result of the upgrade, the difference in prices between petrol and diesel models could widen further in 2020.

Ueno says that Honda is looking at ways to minimise the increase in cost, and is also considering the possibility of locally producing parts of the diesel particulate filter that the engine will require. Honda is already testing the BS VI-ready version of the diesel engine in India and Ueno stated that the initial tests have been going smoothly. “We have the technology. The challenge is not performance of equipment but of cost.”

Honda’s 1.5-litre i-DTEC engine currently powers the Amaze, BR-V, City, Jazz and WR-V. The Honda CR-V that will be launched in India in 2018 will be offered with a 1.6-litre diesel engine from the same ‘Earth Dreams’ engine family. Notably, the 1.6-litre engine is Euro 6-compliant. The 1.6-litre engine will be locally assembled in India and will also find its way onto the new Honda Civic that is scheduled for an India return in 2019.

The demand for diesel vehicles in India has seen a mixed result, with SUV segment witnessing a lion’s share of sales in the country, in fact as per Society of Indian Automobile Manufacturer (SIAM) data for October 2017, a total of 66,140 diesel vehicles were sold making up a total of 83 percent share (79,323 total sales), while petrol percentage stood at 17 percent. Last year for the same period the ratio stood at diesel 86 and petrol 14.

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