Hey Guys... I was planning to buy Mahindra XUV700 AX7 for my family. Just like everyone else, I was too much confused in figuring out which version I should go for i.e. Petrol or Diesel. I have done a lot of research for the same which I feel could be beneficial to others as well. I am sharing the content along with the calculation spreadsheet.
Problem Statement: Which one to choose XUV700 Petrol v/s Diesel?
Background:
Traditionally, we have be a family of petrolheads and we have a lot of misconception about diesel cars w.r.t. maintenance, noise, pollution, ownership costs etc. I stay in Bangalore and I already have a 2015 Swift VXi, ran around 62000 KMs till date. I will keep on using it for local duties and office purpose. Generally, it gives me around 15-16 kmpl mileage in city with AC on.
As much as my current car is maintained, I do feel its unsafe, impractical and unworthy of long highway trips due to lack of safety features (like ABS, Airbags etc) and low boot space (204Lt). Any journey of more than 2 hours with 4-5 adults is uncomfortable. Hence, the need for a safe, comfortable and spacious second car is there for highways and weekend city drives.
Solution & Alternatives:
For last couple of months, I took test drives of lot of Sedans and SUVs which could fulfil my requirement. After checking everything, I decided to go for XUV700 AX7 Manual because it checks all of my boxes.
I like to operate the car and not drive the car, hence I like to go for manual transmission vehicles. I have driven my fair share of automatics (mostly outside India) but the lack of involvement, sometimes makes me feel sleepy in automatics during long drives. Also, considering this is going to be my last ICE car, I want it to be a fun one. Hence, I have discarded automatic for my calculations. However, you can consider it for your purposes by updating the values in the attached sheet for your consideration.
External Factors ?
- Diesel have always been the poster child of pollution in India, since the Hon. Supreme Court of India banned diesel vehicles ageing more than 10 years old in NCR. Although, till date, fore mentioned ban has been limited to NCR and people are challenging the decision by filing the petition(s) in court to review this decision, yet people in other states (and especially from metropolitan ares on India) are skeptical that this ban may very well be expanded to other cities if pollution level rises.
- Since the Paris agreement of 2015, developed countries have been forcing countries like India and China to cut down our carbon footprint. Our Government is very well aware of the fact that reducing the carbon footprint of the manufacturing sector and production houses is going to be a massive task and may lead to slowdown of growth of the economy. Therefore, option of banning Diesel for private vehicles could be looked upon as an 'low hanging fruit'.
- During the migration to BS6, many car manufacturers like - Maruti, Skoda, Volkswagen etc. have stopped producing diesel cars at all. All of this combined has lead to massive confusion among common people w.r.t. car buying decisions.
- Our Government is committed to cut down import of crude oil. Move towards E10 and E20 petrol is a step towards that mission.
- War, recession, changing world order and global uncertainty might raise costs of crude in future. As we import more that 80% of our oil from other countries, we will face the burnt of it.
Silver Lining
- BS6 standard has brought emissions of a diesel vehicle, much closer to petrol. Following table showcases the same. As BS emission norms usually are based on Euro emission norms, it is expected that a revision to BS6 (notably known as BS6.5) might come into force around April 2023 and BS7 is expected be the last iteration of it (expected around 2028). However, the emission targets for BS6.5 and BS7 are still unknown.
- I personally don't think that fossil fuel based vehicles could be completely eliminated by 2040 as a lot of commercial sector still depends on it and migrating all/ most of it to batteries is a Herculean task which will require lot of CAPEX, R&D, time and courage from Government and Private sector.
- Fuel price and efficiency plays a big role in choosing the vehicle and diesel cars have always been ahead of petrol in both of these categories. Current difference between fuel prices is around Rs.15. Going forward, its expected to remain the same. Worst case, even if diesel price is same to petrol, car will always give better mileage.
- I am based out of Bangalore, where road taxes are one of the highest in India and roads are one of the worst. The current price of petrol is Rs.101.93 and for diesel is Rs.87.89. Historically, there was a price difference of almost 1.25 lakh to 3 lakhs on petrol and diesel versions of a car. So, if running is low then opting for a petrol version was a no-brainer. But now with the introduction of turbo petrol motors combined with BS6 norms, the difference between petrol and diesel versions of a car like XUV700 is just 80K to 1.25 Lakh. Do note that difference may be more in case of other vehicles or it you try to compare a NA petrol engine with turbocharged diesel engine.
- For past few years, condition of national highways in India has improved but roads within cities (especially in Bangalore) has gone downhill. This is one of the reasons for the rise of demand of SUVs in India. Big SUVs (6-7 seaters) are usually heavy vehicles and diesel is the preferred choice of fuel for such kind of vehicles.
- The common myth around diesel engine is that - car needs to be run daily otherwise engine issues might erupt. The technology has changed a lot even if a car is run once a week, it will not encounter any issues. Moreover, turbo petrol engines share the same architecture with turbo diesel, so the same precautions are applicable for petrol cars as well.
- As of 13th Sep'2022, I am not able to find pre-owned diesel XUV700 in Bangalore. Whereas, almost 5-6 petrol versions are available across the portals. This shows that at least there is comparative low resale demand of petrol versions and high demand for diesel in pre-owned market. I am not sure of the long term resale conditions though.
- There is still a very high demand for diesel model in big cars like XUV700. For reference, current waiting list in petrol AX7 Manual is 5-6 months. On the other hand, diesel AX7 Manual has a waiting list of 10-12 months.
- And lastly, the thumb rule of Demand and Supply. Currently, there is a huge demand for petrol and diesel based vehicles, hence the cost of such fuels is rising. Moreover, there are enough reserves for fossil fuels in the world to power more than 200 years. The EV story for India and rest of the world has just started and the EV boom is yet to come. So, in future, when the future passenger vehicle market is dominated by EVs, the cost of petrol and diesel may come down due to low demand. This will help the owners who are intending to use the vehicle for its entire life.
Finally, I am attaching the Costing & High Level Analysis Spreadsheet for your reference purposes. The fields in the sheet are editable and can be modified based on the model(s) you are intending to compare.
I really hope that you guys will find it valuable. Let me know if you have any comments.
Thanks.
