Falling diesel registrations: why we shouldn’t be alarmed

GiPA have recently issued a newsletter on the subject of the fall in registrations for diesel vehicles and have given permission for this to be reproduced in the eBulletin.

Diesel, and the falling registration figures of passenger cars using the fuel, has been a concern for numerous companies operating across Europe. With the fuel type demonised by many in the public sector and the general public alike, several countries have seen diesel’s share of total registrations drop by 20% or more between 2014 and 2018.

In the EU5 countries the impact of ‘diesel gate’ has varied. Italy, for instance, has been left largely unaffected by diesel’s negative press, with diesel’s share of registrations having only dropped by 3% between 2014 and 2018. Others have not gotten off so lightly however; in Spain, diesel’s share of registrations dropped by 30% during the same period. On average across the EU5 nations the effect has been pronounced; across France, Germany, Italy, Spain, and the UK, diesel’s share of registrations dropped by an average of 19% between 2014 and 2018.

In 2014, in the UK, 50% of new passenger car registrations were diesel. In 2018, diesel’s share dropped to 30%

The end of the road for diesel?
Seeing a fuel type – which once accounted for over 50% of registrations in many countries – drop in demand so quickly, losing relevance, will inevitably create worry. This will especially be the case for those heavily invested in the fuel type (vehicle manufacturers, parts manufacturers focused on diesel parts).

But is it really the end of the road for diesel?

No… At least not for those invested in the diesel aftermarket.

Diesel’s drop in registrations has been sudden and significant, rather than gradual, and as recently as 2016 diesel accounted for 47% of new car registrations in the UK. The vehicles registered in 2015, 2016, 2017, 2018. These vehicles are yet to reach their aftermarket maturity; they are destined to have many years of service still ahead of them, and therefore more workshop entries. Furthermore, the adoption of diesel is still relatively new to the market place; diesel vehicles only began becoming prominent in the early 2000’s, and registrations peaked in 2015. Considering the life expectancy of a diesel car is 13.7 years (the average diesel car being 6.7 years old), and with diesel vehicles still being purchased by drivers, the diesel parc is still actually growing in size.

As can be seen here, there are millions of diesel vehicles on the road which are less than 5 years old. These vehicles still have a long life ahead of them and will require access to aftermarket services for many years yet.

As visualised above, there are still millions of diesel cars between <1 and 5 years of age still with their ‘prime’ workshop years ahead of them. With nearly half of the diesel parc falling into this category, GiPA fully expects the importance of diesel to the aftermarket to increase in the coming years, as more and more of these younger bracket vehicles age and their requirement for workshop entries increasing along with it.

It is not simply diesel specific parts which will benefit from this though. Diesel car drivers drive their cars more per year on average than their petrol driver counterparts. Considering this, opportunities for changing wear and tear parts on diesel vehicles will also increase in the coming years as the diesel parc increases.

Sales of diesel cars may be going through a downturn, but this doesn’t necessarily mean the aftermarket will also see a downturn in diesel focus too.

Your Comments