Gasoline Cars Highly Likely to Eclipse Diesel Cars in Import Car Market

The popularity of diesel models is on the skids not only in Korea but also worldwide.

It has become highly likely that gasoline cars’ market share will outweigh those of diesel cars in the import car market within this year following the domestically produced car market.

Thanks to the steady popularity of sedans such as the Hyundai Motor Grandeur, gasoline models account for around 50% of the domestically produced car market in Korea, much higher than the 35% of diesel models.

However, in the import car market, diesel vehicles have eclipsed gasoline vehicles since 2012 when their market share surpassed 50%. In 2015 when the Volkswagen Tiguan sold well, diesel vehicles accounted for nearly 70% of the import car market. However, the market share gap between import diesel (46%) and gasoline (45%) cars was narrowed down to one percentage point in the first half of this year.

The popularity of diesel models is on the skids not only in Korea but also worldwide. In Europe, the home of diesel vehicles, 46 percent of new vehicle sales were diesel models in 2012 but last year, their proportion fell to 32 percent last year. As Volkswagen rigged gas emission software to manipulate diesel cars’ fuel economy, BMW diesel cars sold in Europe also burst into flames due to their flaws and diesel cars are blamed for pollution, consumers are turning their backs on diesel models.

These changes are leading global automakers to halt the development of diesel engines and reduce the number of diesel models. Volvo already announced that it would stop developing diesel engines, and Fiat Chrysler will stop producing diesel cars in 2022. Toyota, Nissan and Honda are also ditching diesel models. Hyundai is also considering cutting down the number of its diesel sedan models in Korea, and suspending the launch of a diesel sport utility vehicle (SUV) scheduled to be released in the US.

The automobile industry expects that the import car market in Korea will be reorganized into a gasoline model-led market. Volkswagen and Audi that returned to the Korean market in two years, recently launched gasoline models and Mercedes-Benz plans to focus on gasoline and electric hybrid models, reducing the proportion of the diesel model 220d, in the E-Class lineup. BMW, which recently decided to make a recall due to fires caused due to a diesel engine failure, added the 520i model to the 5 Series gasoline lineup. The 520i sold 448 units in one month since its launch in Korea. Its sales figure is only 75 units apart as the 520d sold 523 units during the same period since its launch in Korea.

"The continued controversy means that the diesel engine has not satisfied consumers in terms of both performance and environmental regulations," an automobile industry official said. "The automobile market is heading for electric cars via gasoline and hybrid cars."