Buy your dream diesel car before taxes are slapped

The demand for diesel cars has shot up in the past few weeks, as consumers fear the imposition of a new tax on such vehicles in the Budget.

About 45 per cent of car sales since October have been diesel, but the capacity has been constrained.

A proposed tax to the tune of Rs 80,000 is expected to be slapped on diesel cars to address the imbalance between these and the petrol versions caused by the widening price gap between the fuels.

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The country's largest car maker, Maruti Suzuki India Ltd (MSIL), says it has seen a 25 per cent rise in monthly queries for diesel cars in the past few weeks.

It is struggling to keep pace with the demand, especially for the Swift and the DZire, despite fresh supplies of diesel engines from Fiat.

Shashank Srivastava, chief general manager, marketing, says, "The anxiety among buyers about the diesel tax has fuelled demand.

We tried to bring down the waiting period with additional engine supplies but this tax fear has again pushed the period to five and a half months for the Swift and five months for the DZire (diesel variants)."

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Mahindra & Mahindra is also facing large waiting lists because of the sudden spurt in demand. Says Pawan Goenka, president, automotive and farm equipment sectors, "We have a waiting list of about four-six weeks on our diesel multi-utility vehicles as well as SUVs. Earlier, we were able to offer the vehicles within a week."

Goenka also attributed the trend to the new tax fear.

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Consumers are also getting attracted to diesel cars available on the spot before their Budget deadline.

For instance, demand for the Pulse hatchback by French car maker Renault, which used to sell 700-750 a month, has shot up because it does not have a waiting period. Sumit Gupta, director, Gen Next Motors, a Renault dealer, says, "The immediate availability of the car has played a key role in the purchase consideration of buyers."

He says the number of Pulse units sold has risen 15-20 per cent.

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Fiat India has seen the demand for its Punto and Linea models go up, as it promises 'ready delivery'.

Rajeev Kapoor, chief executive, Fiat India Automobiles, says, "There has been a perceptible change in two-three weeks in the buying decisions of consumers. Most are trying to finalise purchases before the Budget."

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Sensing the mood, Tata Motors is offering consumers book diesel vehicles at the prevailing prices and take the delivery in April with 11.5 per cent interest.

The EMIs would begin in April.

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Toyota Kirloskar also admits there has been a marked increase in demand for the Innova, Fortuner, Etios and Etios Liva diesel versions.

"There is pressure for deliveries before March 16. At present, there is a six-eight week wait for the Etios and the Liva," it says.