Maruti Suzuki to Drop Diesel Production in 2020

Maruti Suzuki India Ltd., the country’s largest carmaker, says it will stop offering diesel-powered vehicles in April 2020.

That’s when India will move from BS4 to BS6 emission standards, which include a move to low-sulfur fuel. Maruti Suzuki says modifying its engines to meet the new regulations would have a significant impact on price and make the under-1.5-liter diesels used in its lower-priced models “unviable.”

Dropping diesels will affect 23% of Maruti Suzuki’s sales in India. The country’s overall demand for diesels peaked at 58% in 2013 but has been declining since then.

BS4 diesels already carry a cost premium of about $1,400 compared with a gasoline-fueled engine. Maruti Suzuki says it may decide to remain in the market for 1.5-liter diesels if demand is sufficiently high.

Maruti Suzuki is scrambling to adjust its powertrain plans to offset the loss of small diesel. The company’s Breeza and S Cross SUVs, for example, currently are powered exclusively by 1.3-liter diesels. Small diesels also are offered as an option in several other minivehicles.

Chairman R.C. Bhargava says the company hopes to replace small diesels in many cases with hybrid powertrains and engines that run on compressed natural gas. He regards electric vehicles as an unlikely option because of their high cost and lack of charging infrastructure.