Diesel engines are not going away anytime soon: Mahindra

The XUV700 maker sees majority of the demand come from diesel variants of its SUV line-up

The mass market Indian automotive landscape has been shifting towards cleaner fuels and different degrees of electrification. As part of this change, many carmakers ditched their line of diesel powertrains altogether. However, there are large brands which still see a future where diesel engines have purpose and demand. One such company is Mahindra.

Strong demand for Mahindra diesel models

“Our view as we’re seeing with the (XUV)700 launch, Thar launch and now with Scorpio N launch, diesel is going to be around,” stated Veejay Nakra, CEO of Mahindra Automotive. He is referring to the majority demand for the diesel-powered variants of its three newest SUV offerings that use the same petrol and diesel engines in different states of tune.

The Thar, XUV700 and Scorpio N are offered with the choice of a 2-litre turbo-petrol engine and a 2.2-litre diesel engine. Both motors are available with either a 6-speed manual or a 6-speed automatic. In the case of the Thar, both engines come with 4WD as standard, whereas the XUV700 and Scorpio N limit the 4WD variants to the diesel engine only.

What about the issues around diesel engines meeting regulatory compliance?

One of the main reasons carmakers decided against offering diesel powertrains was to be compliant with the ever tightening emission norms, as well as the country’s upcoming CAFE (Corporate Average Fuel Economy/Efficiency) regulations. 

Updating diesel engines to be compliant with stringent emission norms is an expensive exercise that would hurt most brands whose buyers would be pushed away by rising prices. That’s why most carmakers pulled out of manufacturing smaller diesel engines in large volumes.

Also read: Maruti Reaffirms Intent To Keep Off Diesel Engines

However, Mahindra can continue to sell a majority of diesel-powered cars while still being compliant with the aforementioned regulations. First, its line-up is made almost entirely of SUVs and its customer base is primarily interested in diesel-powered vehicles for a comparatively lower running cost (against a petrol version) and punchy performance. 

So, the demand for diesel vehicles is not expected to decline sharply despite the increase in prices to keep them compliant. Most Mahindra SUVs are priced between Rs 10 lakh and Rs 30 lakh (ex-showroom) and a diesel powertrain sees high demand in that price range.

• Mahindra Thar Price
• Mahindra XUV700 Price
• Mahindra Scorpio N Price

Secondly, Veejay Nakra stated, “If you look at it from a CAFE point of view, diesel is better than gasoline (petrol)." The larger displacement diesel engines used by Mahindra’s top-selling models are better suited to meet the emission norms as per the carmaker.

Another reason why Mahindra can stick with diesels while others, including market leader Maruti Suzuki, cannot, is because of volumes. Despite the brand’s immensely successful line-up, it delivers an average of 25,000 units a month, most of which are powered by a diesel engine. Meanwhile, Maruti produces an average of around 1.2 lakh units a month. It would struggle to keep its overall emission figures low enough if a healthy share of its sales were from diesel models.

Mahindra is working on EVs too

While the carmaker does not see an imminent end for the diesel powertrain, it is preparing for the future as well. Mahindra is working on a line-up of pure-electric SUVs for India starting with the XUV400 which is due for launch in early 2023. 

Before then, the marque will debut its vision for a line of dedicated EVs on August 15, 2022. Mahindra will also elaborate on its EV plans during the same event.