Toyota said ‘diesel is dead’ - now it’s written its death notice
Cantillon: Toyota is to stop making diesel passenger cars but what about resale values?
Toyota’s decision to abandon diesel engines in its passenger car fleet from the end of this year was, perhaps, inevitable, given its devotion to petrol-electric hybrid technology. This is the same firm whose premium sub-brand Lexus has been proclaiming “diesel is dead” in a recent ad campaign.
The big surprise is the short timeframe. Toyota seems to have got a lead on its rivals in pitching itself as one of the industry innovators.
It’s a landmark day for the best-selling car brand in the Republic, a brand long been associated with rural motorists who religiously opt for diesel. For Irish motorists it means the end of the road for the diesel Avensis, Corolla and even RAV4.
At times Toyota has taken an almost fundamentalist approach to petrol-electric hybrid technology, but the jury is still out on whether hybrid is the best option for all motorists. The fact that commercial vehicles in the Toyota fleet will retain their diesel engines is a case in point. Similarly, not all hybrids are the same, and some of the milder versions only really deliver fuel savings in urban traffic.
Nonetheless, the move chimes with the Government’s recent announcement that it is looking to ban new diesel car sales in Ireland from 2030 and ultimately take all non-zero emissions vehicles off the road by 2045.
So the clock is already ticking for the future of diesel and undoubtedly it will have consequences for the resale values of the current diesel fleet. That is certain to annoy many motorists who were driven to purchase diesels on the back of the government’s decision to base our taxation policy on CO2 emissions from 2008. Diesels have lower CO2 emissions than petrols so the tax policy led them to make the change. They paid a price getting out of their old petrol cars at the time, and they may suffer financially getting out of their diesel cars now.
Toyota’s decision was announced on the eve of the Geneva Motor show, one of the biggest automotive gatherings of the year.
Switzerland may be neutral territory but it will offer no respite for the industry’s embattled executives. Car firms, normally attend to pull the covers off shiny new metal; this year they are faced with proposed diesel bans in many countries and major cities, the growth in car-sharing schemes, the imminent arrival of driverless cars, and the arrival of heavyweight new entrants to the market, from Tesla through to Google and Apple. As if those existential challenges weren’t enough, president Trump has suggested punitive tariffs on European car imports to the US as trade-war talk heats up.
In the midst of all this upheaval and uncertainty, the new cars unveiled at the show are likely to get lost in the noise.