Business

Diesel overtakes petrol car sales for first time

Diesel pump
Image caption The sales rise reflects lower running costs, motoring groups say

Sales of diesel cars have overtaken petrol for the first time, latest car industry figures have shown.

Diesel sales made up 50.6% of the total in July, the Society of Motor Manufacturers and Traders (SMMT) said.

The sale of petrol cars dropped by almost a third in July compared with the same month a year earlier.

Petrol sales have fallen since the end of the government scrappage scheme in March, which saw motorists buy smaller, cheaper cars.

"The diesel market is seeing strong recovery after last year," a spokesperson for the SMMT told BBC News.

"Demand fell as diesel prices rose and the scrappage scheme was actively boosting sales within the small car market, where diesel engines do not penetrate as high as petrol."

Industry experts say that the 11.8% rise in diesel car sales in the past year also reflects the need to curb total household spending in the current economic climate.

"Although some of the increase in diesel sales will be down to companies restocking fleets after the economic downturn, many will be from drivers who are fed up with petrol costs that remain historically high," said Edmund King, president of the AA.

"They are buying despite the £1000 extra cost of diesel car, relying on the 15-20% greater fuel efficiency to leave them better off in the long run."

According to the motoring organisation, a petrol car owner is now spending on average £123.85 a month on fuel compared with a diesel driver's average spend of £103.28.

Differences narrowing

The popularity of diesel has been helped by a substantial fall in the price differential between petrol and diesel. In 2008 it was 13p per litre, wiping out any substantial cost savings a more fuel-efficient diesel engine might offer.

Last month, the difference at the fuel pumps was only 1.5p per litre.

The recent rush to diesel has also meant a correlating increase in registrations of MPVs (such as people-carriers) and SUVs (sports utility vehicles). These accounted for one in eight new cars registered in July.

"Furthermore, wider availability of more fuel-efficient diesel-engined cars has increased the appeal, particularly within the fleet and business markets," said the SMMT.