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Surge in diesel interest tipped to continue

Six-speed auto: Peugeot's 307 HDi now comes with a tiptronic auto shifter.

Petrol price volatility has refocused attention on newer-generation diesels

21 Sep 2006

PEUGEOT has forecast a continuing sales surge in turbo-diesel passenger cars, predicting that by 2010 10 per cent of all cars sold locally will be oil-burners.

This share will equate to about 65,000 vehicles annually, according to Peugeot Automobiles Australia managing director Rob Dommerson.

Today, diesel cars enjoy a 2.4 per cent share over the overall passenger-car market.

But over the past 12 months, diesel cars have enjoyed a phenomenal 160 per cent growth, admittedly off a low base, in part because they are between 25 per cent and 30 per cent more fuel efficient than a similar sized petrol engine yet offer superior performance.

Year-to-date private buyers have bought 6533 diesels, up from 3003 for the same period last year, on the back of surging petrol prices.

Fleets are also turning to diesel, with 3127 cars being sold so far this year, up from 1073 last year.

Recent (Peugeot-commissioned) research conducted by Roy Morgan showed that, of 4377 people surveyed who intended to buy a new vehicle within four years, 73 per cent would "seriously consider buying a diesel vehicle".

Mr Dommerson said the tide had turned as newer-generation direct-injection diesels with particulate filters banished the thinking that these engines were dirty and slow.

Servicing costs between comparable petrol and diesel hatches were also similar over a 100,000km period as customers factored in whole-of-life running costs, he said.

He believes that if local car-makers like Holden and Ford join the turbo-diesel bandwagon, the 10 per cent share could be higher.

"There’s no doubt that when, not if, the local car-makers add diesels to their line-ups, the market will grow substantially," he said.

Already Holden is testing the waters with its Astra CDTi and Ford is considering adding the Focus TDCi to its line-up.

Holden is also known to be looking at a diesel Commodore, which could be on sale within three years.

Peugeot considers it somewhat ironic that in the recent rush to diesel cars by some of its competitors, buyers have overlooked the fact that Peugeot has offered a diesel in its line-up here since 1978.

Holden also briefly made a foray into diesel territory too with its 1981 Gemini.

Until recently, Peugeot and Mercedes-Benz, had enjoyed the luxury of pioneering the availability of diesel cars locally.

"Five or six years ago if you thought diesel you thought Mercedes or Peugeot," Mr Dommerson said.

Today, 40 per cent of all cars on local roads since 1993 are Peugeot diesels, he said.

Even today Peugeot enjoys a solid diesel reputation, with 48 per cent of all 307s diesel while 65 per cent of 407s are diesel.

This year one in four of all diesels cars sold will be Peugeots, Mr Dommerson said.

23 center imageLeft: Peugeot 207.

In a move to reclaim its diesel mantle, he conceded that Volkswagen had dipped into Peugeot’s turbo-diesel "honey pot" and that the company would renew its focus on its own High-pressure Direct Injection (HDi) engines but not at the expense of its petrol sales.

To answer VW’s success with its Golf 1.9 and 2.0-litre TDI six-speed DSG auto, Peugeot has just added an Aisin six-speed tiptronic-style auto to its 307 HDi line-up.

The 307 XSE HDi hatch and Touring went on sale last week, priced at $34,790 for the hatch and $36,490 for the Touring.

They supplement the 407 HDi sedan, Touring and coupe, and, from early next year, the 207 HDi.

The 307 HDi autos share the same 2.0-litre four-cylinder engines as their five-speed manual counterparts, developing 100kW at 4000rpm and 320Nm from 2000rpm.

Previously the 307 HDi offered a four-speed auto.

Mr Dommerson recognised that its relatively high retail cost and the infrastructure for diesel throughout Australia remained stumbling blocks for buyers and he urged oil companies to improve its appeal.

Peugeot is currently in talks with oil companies about improving the quality and cleanliness of diesel bowsers at petrol stations around the country.

"The first fuel company to get in and tidy up their act will secure the diesel market," Mr Dommerson said. "There is a marketing opportunity to tie up with the oil company that has the right diesel forecourt."Mr Dommerson recognises that diesel is more expensive at the pump than petrol, but he believes that economics will drive lower diesel pump prices as more consumers switch to diesel cars.

According to the Australian Institute of Petroleum, less diesel is sold through retail outlets than petrol, and diesel prices are not subject to a discount cycle to the same extent as petrol prices.

In Australia, only 25 per cent of diesel is sold through retail outlets, with the balance sold with long-term contracts to commercial and industrial customers such as the mining and transport industries.

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