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    Sep 16, 2015

    Diesel model cars gaining popularity in S'pore

    DIESEL models have become the fastest-growing segment of cars, with interest fuelled by revised taxation, the Carbon Emission-based Vehicle Scheme (CEVS), lower running cost and an overall improvement in diesel technology.

    According to Land Transport Authority data, there are now close to 5,000 diesel-powered passenger cars on the road - up from fewer than 150 five years ago.

    With the quantum leap in growth, the diesel car population has now outstripped the cohort of cars that run on compressed natural gas (CNG), and is expected to overtake petrol-electric hybrids soon. There are now around 6,200 of such hybrids and fewer than 2,000 CNG cars.

    After being largely ignored in the last several decades, diesel cars began to sway buyers in 2013 when a special tax for such vehicles was slashed for cleaner models.

    For Euro 5 diesel cars, the tax is 40 cents per cubic centimetre of engine displacement, versus $1.25 for Euro 4. For those which did not even meet Euro 4 emission standard, the tax was several times the vehicle's road tax.

    CEVS - with rebates and penalties pegged to a car's carbon emission - was also rolled out in 2013, and made more stringent this year. As diesel cars produce far less carbon dioxide than petrol equivalents, they qualify for CEVS rebates more easily.

    A 130bhp power cap for Category A Certificate of Entitlement (COE) was also announced in 2013.

    As diesel cars tend to produce less power but more torque, dealers began offering more of such models two years ago. And consumers have warmed up to them.

    Volvo agent Wearnes Automotive sold 52 diesel cars in 2013, 530 in 2014 and 444 in the first half of this year.

    Peugeot agent AutoFrance said its diesel car sales doubled from 2013 to 2014, and trebled from 2014 to 2015. In fact, diesels now make up half its total sales.

    Shipyard manager Avery Yeo, 47, said he bought a diesel Peugeot 5008 because he lives in Bedok and works in Tuas.

    "I clock at least 80km a day," Mr Yeo said. "I get 22.2km per litre with the 5008, compared to 16km for my previous car, a Toyota Wish."

    And since diesel is also cheaper at the pumps than petrol, Mr Yeo said "it's really worth it".

    The sums add up even for someone clocking a national average of 50km per day. A 1.6-litre petrol car would use around $4,000 of fuel a year, compared with $1,600 to $1,700 for a 1.6-litre diesel.

    Both estimates are based on pump prices before discount.

    This fuel saving more than offsets the $763 premium in annual taxes the latter attracts, assuming it is a Euro 5 model.

    Watch dealer Leslie Chang, 52, said even though his Mercedes-Benz C200 diesel attracts more than $4,000 in annual taxes - because it is a Euro 4 model - and "is a little noisy when idling", he still enjoys it.

    He said his car also has a "feel-good factor" because of its low fuel consumption and carbon output.

    Nanyang Business School adjunct associate professor Zafar Momin said diesel cars are even gaining a foothold in the United States, a predominantly petrol market.

    In Singapore, Mr Momin attributes diesel's meteoric rise to a host of economic reasons. But the biggest one, he said, was the power cap for Category A COE. "From a pricing standpoint, diesel models became much more attractive than the petrol versions that were moved to Cat B."