Delhi pollution update: SC bans all luxury diesel cars

In a nightmarish decision for the country’s diesel car majors, the Supreme Court banned the registration of all diesel SUVs and luxury cars with engine capacity of 2000 cc or more in the entire National Capital Region till March 31 next year, on Wednesday.

As a part of countering the alarmingly high pollution levels in Delhi, the top court also ruled that all trucks not bound for Delhi will not be allowed to enter the capital through National Highways 1 and 8. Those carrying goods for Delhi will have to shell out a steep environment compensation charge (ECC) — Rs 2,600 for big trucks and Rs 1,400 for light commercial vehicles, which is double the ECC earlier specified by the court.

The Supreme Court has also asked all the private cabs operating in the city to convert to Compressed Natural Gas or CNG by March 1 next year. However, there is a relief for ordinary commuters as small diesel cars are exempted from this ambit. The court said its order overrides all the other orders passed by other forums, including the National Green Tribunal (NGT) that had recently banned the registration of all diesel vehicles for up to four weeks in the capital.

Automobile dealers in Delhi were facing a pile-up of stocks as sales plummeted following the recent NGT order banning registration of diesel cars as part of measures to clean up the abysmal air quality in the capital, which has been between "poor" and "hazardous" levels for several weeks now.

Over 23 per cent of the cars on Delhi roads reportedly run on diesel which produces much more carcinogenic nitrogen oxide than petrol cars. According to the Society of Indian Automotive Manufactures, 37 per cent of all passengers cars sold in India during the last April 2014 to March 2015 financial year were diesel variants, and sale of diesel cars – as a proportion of the total – have been rising in recent months.

But around 90 percent of the SUVS and other utility vehicles sold last year are fuelled by diesel, which is substantially cheaper than petrol.

The ban will hit some of India’s best-selling passenger vehicles, including Mahindra & Mahindra’s Scorpio, Tata Motors’ Safari and Sumo, Toyota’s Innova, Mitsubishi’s Pajero.

The entire portfolio of Mercedes-Benz – from the A-Class hatchback to the S-Class sedans, as well as its entire range of SUVs will be impacted by the ban. Diesel cars account for around 80% of Merc’s sales in India, and the NCR contributes nearly 22% of its national sales.

Shares of automaker Mahindra & Mahindra – whose entire portfolio is diesel vehicles – fell sharply after the ruling and were still down 4.4 per cent at midday. In an official statement, the company secretary of M&M Narayan Shankar said, "The affected vehicles represent 2 per cent of the company's total monthly sales."