Fleet News

Is diesel set to make a comeback in Britain?

A REVOLUTION is taking place in the diesel market as a wave of new technology tempts fleets with petrol-like performance, high economy and low emissions. With a radical change to benefit-in-kind tax on the horizon for April 2002, basing all company car tax on a vehicle's emissions, manufacturers are predicting diesel power will come to the forefront of many fleet attentions.

Manufacturers say the advancements in diesel technology, with widespread use of common rail engines and the arrival of particulates filters, will revive the diesel market which has seen sales plunge in the UK. The drop in sales came in the wake of predictions of an explosion in the diesel market following the 1997 Frankfurt Motor Show, where almost every manufacturer announced the addition of diesel to its range. Despite this the 1998 fleet diesel market ended 3% down on 1997 at 197,579 registrations (203,627). And the first seven months of this year remained 3.3% down on the same period of last year.

The Government is considering implementing a penalty on diesel under its new CO2 BIK tax system, which could see diesel weighted with a 3% premium over petrol models, and it continues to increase duty on diesel ahead of petrol making it less competitive at the pumps. But the general use of common rail engines with particulates filters could soon shoot holes in the Government's arguments, as the emissions will be cut, and almost all local pollutants removed by the filter - local pollutants being the reason the Government says diesel should be penalised.

John Britcliffe, managing director of Overdrive Business Solutions, whose own-label network access, processing and authorisation services cover 658,000 vehicles operated by 30 manufacturers, contract hire and finance companies, said: 'The Government has stated clearly and concisely what it wants: lower emissions and high fuel efficiency.

'The challenge is there for the manufacturers to develop their products to achieve those results, and I believe they should focus on that goal rather than trying to get the 3% levy dropped.'

The view of the manufacturers that diesel sales could soon be on the increase has been supported by fleet consultancy Driving Costs Down, which claims to advise more than 500 companies on their fleet policies. Ross Jackson, chief executive of the consultancy, said: 'It does look as though we are leaving behind what had seemed to be a gradual demise of the diesel market.. Diesel is losing that dirty, smelly image and that will do it wonders.'

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