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Diesels are cheaper than petrol cars...for some of us

Robert Powell
by Lovemoney Staff Robert Powell on 26 April 2012  |  Comments 21 comments

Drivers have to do 10,000 miles per year to make buying a second-hand diesel car cheaper than a petrol model, say industry experts

Diesels are cheaper than petrol cars...for some of us

The disagreement that dogs the motoring industry: diesel or petrol? Yes, the tiff between the two types of motor is still rumbling on. Which is cheaper? Which is greener? Which give a smoother ride? I could go on…

But while several of these questions are still left unanswered, one group of industry experts has now waded onto one of the key battlegrounds with a convincing response.

The ‘golden numbers’

Experts at Glass’s Guide, the bible for many car dealers, have calculated that motorists must drive 10,000 miles every year to make a second-hand diesel car cheaper than a petrol model. For new diesel cars, the figure is lower at 6,000 miles per year.

These ‘golden numbers’ were arrived at by analysing thousands of car prices and fuel costs. Diesel cars command a strong premium over their petrol cousins, but have a far better fuel economy than petrol models, meaning motorists will save money if they drive enough miles.

Glass’s Guide says that the average cost of a new, family-sized diesel car is £1,300 more than its petrol equivalent. This difference is even greater for second-hand cars, thanks to the high resale values of diesel models. It’s estimated that an average three-year-old family car running on diesel is £2,000 more expensive than a petrol equal.

This increase in resale value has been driven by strong levels of demand from motorists looking to beat soaring petrol prices. Improvements in diesel technology that have led to a smoother driving experience have also played a part. Demand has now grown so strongly that half of all car sales made in 2011 were diesel.

The future

So in light of this recent surge in demand for diesel models, what does the future hold for the price of diesel cars? Well, Glass’s Guide predicts the gap between diesel and petrol cars will remain constant.

Adrian Rushmore from the guide said: “More and more used diesels are coming on to the market and with new diesel car sales surpassing petrol last year, we’re only going to see an increase in the amount available on the second-hand market. This increased availability should stop used car prices rising too much further.”

But there are still several other factors to consider when making the choice between diesel and petrol.

Fuel prices

As we reported back in February, the first few months of 2011 have seen diesel accelerate in price at a far faster rate than petrol. This has begun to slow marginally; however diesel is still over 5 pence per litre (ppl) pricier than petrol at 147.9ppl compared to 142.5ppl, according to The AA.

Take a look at How to find the cheapest diesel and petrol prices for some tips on slashing your fuel spend.

Car tax

Diesel cars cost less in road tax, thanks to their green credentials. The bands for the tax are divided up according to CO2 emissions. So the greener the car, and the less you damage your wallet, as well as the environment. This is good news for diesel cars as they are usually more efficient than their petrol equals.

MSN Cars recently put together the top ten most economical cars. Seven diesel models appeared in the list, all with CO2 emissions below 100g/km – making them eligible for free road tax. MSN named the Kia Rio 1.1 Ecodynamics as the greenest model, with emissions of just 85g/km.

Insurance

Whether you drive a diesel or petrol car will also affect your insurance premiums. esure estimates that diesel models are on average 10% more expensive to cover than their petrol equals, due to higher repair costs.

Depreciation

As I’ve already mentioned, diesel cars hold their value far better than petrol models. Read The cars that depreciate the fastest for a rundown of the new models that lose their value most rapidly.

What do you think?

Which is cheaper? Diesel or petrol?

Let us know using the comment box below.

More on cars:

The most expensive petrol in the world

Car finance: a terrible way to pay for your new car

Car vs public transport: An old banger is cheaper than the bus!

Motorhomes: how to make money from caravans!

RAC vs AA vs Green Flag: The best value breakdown cover

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Comments (21)

  • Iamcoldsteve
    Love rating 308
    Iamcoldsteve said

    I have been running a cost spreadsheet for my current car (1.8 Petrol Vectra-C) over the 172,000 miles (no typo) that I have driven it. It was second hand at one year old and 13K on the clock when I bought it - so now on 185,000 miles.

    I have included every cost associated with operating that car, from purchase, tax, insurance, MOT, maintenance, tyres etc, so it is a true 'total cost of ownership'.

    I have also had a lot of input from Vectra owners who drive the diesel version.

    If you also factor in the increased purchase costs, service costs, repair costs, less reliable (strange but apparently true), maintenace costs, for the diesel I have found that by far the biggest factor is initial purchase price.

    As I got an extremely good deal for my car, and a diesel version was about 3K more expensive, the TCO cost between the 2 types is only a couple of hundred pounds in the diesels favour - even over 172,000 miles and 7 years. No adjustment for the loss of opportunity or borrowing money has been included - and these would only bring this narrow margin down even further.

    Modern diesels have so many expensive parts that can, and unfortunately do, go wrong. Some cost many hundreds of pounds to replace. The simplicity of a bog standard petrol car far outweighs the financial and mechanical risks of a modern diesel - especially one out of manufacturers warranty.

    The next car I buy will be petrol.

    Report on 26 April 2012  |  Love thisLove  5 loves
  • Mike10613
    Love rating 599
    Mike10613 said

    @Iamcoldsteve, I have a Vectra too, a 2L one that is just as reliable. I had a sensor changed last month and it runs great again now. That is an unusual expense! If you look after them they are very reliable. The ecotech engine seems fairly fuel efficient too for a 2 litre. I've been driving it for 8 years now, no breakdowns and a once a year service keeps it running smoothly. My brother has lot more trouble with his diesel and it is very noisy in comparison.

    Report on 30 April 2012  |  Love thisLove  0 loves
  • logical_one
    Love rating 46
    logical_one said

    Costs are of course very important but as the "green" credentials are also raised as an issue, may I remind those concerned for the environment that CO2 is not a pollutant just plant food that has been politicised into an ideological and highly theoretical problem whereas particulate and other toxic emissions are actually damaging to health and more abundant per mile from diesel than petrol engines.

    Report on 30 April 2012  |  Love thisLove  8 loves
  • Hamsden
    Love rating 2
    Hamsden said

    Diesel engines are probably the best for longevity. However When fitted with a catalytic converter and associated sensor. The mileage boast soon goes up in smoke if the engine is used for short journeys the red light soon comes on and the catalytic converter clogs up. This results in vastly reduced MPG. The solution is to take the engine for a reasonably long 'hot' run to get the catalyst really hot in order to clean it out. Also Diesel engines are fitted with sophisticated injectors that are eye watering expensive to replace.

    So one should take the above into account when considering buying a new or even worse a second had diesel vehicle.

    Report on 30 April 2012  |  Love thisLove  2 loves
  • gavinb
    Love rating 25
    gavinb said

    Don't understand Glass's guide's figures and I'm particularly perplexed by the 10,000 miles second hand and 6000 miles new. Other way round surely?

    Just looked at whatcar.com/truempg and picked two cars, a Fiesta Zetec 1.25 Edge and Fiesta Diesel 1.6TDCi, true mpg figures 42.3mpg and 62.1mpg respectively.

    This looks great but Ford are sticking a hefty premium on the Diesel car, an extra £2500 for the ECOnetic badge. If we keep it 3 years then we have to do better than £833 worth of fuel savings every year.

    Let's take their 10,000 miles x 3 at fuel prices near me:

    Diesel (30,000m / 61mpg) x £1.48litre x 4.55(to gallons) = £3,311

    Petrol (30,000m / 42mpg) x £1.40litre x 4.55(to gallons) = £4,550

    That's a saving of just £1239 or just £413 per year.

    Due to narrowing depreciation the next buyer should do a little better. Only one example, but a popular one. A very sweeping generalisation by Glass'.

    Report on 30 April 2012  |  Love thisLove  0 loves
  • MK22
    Love rating 142
    MK22 said

    My experience of being on the receiving of a Glass' Guide quote for insurance claim purposes makes me disbelieve ANYTHING Glass's Guide says!

    Report on 30 April 2012  |  Love thisLove  0 loves
  • Iamcoldsteve
    Love rating 308
    Iamcoldsteve said

    Hamsden is talking about a Diesel Particle Filter and not a catalyst.

    Report on 30 April 2012  |  Love thisLove  1 love
  • Perry525
    Love rating 25
    Perry525 said

    There is a growing shortage of diesel, the price can only go up !

    Report on 30 April 2012  |  Love thisLove  0 loves
  • nickpike
    Love rating 270
    nickpike said

    Test drove some diesels because I'm thinking of buying a new car. Apart from the expensive BMWs and Mercedes, I wouldn't touch the rest with a barge pole. After my sweet V6 petrol engine, I was amazed at the levels of noise and vibration, particularly in the gear stick. OK, I can live with these levels, but why put up with them. I only drive 7000 miles a year anyway, so the MPG would not offset the initial cost.

    I notice the the 'smoothness' of a car can affect fatigue. I got out of the demo cars and felt like I had been out for a drive. I can get out of my V6 and feel refreshed after 4 hours.

    The exhaust from diesels is far more harmful than petrols fitted with cats. And the gap between diesel and petrol prices is growing.

    I'm going to stick with my V6 petrol for now.

    Report on 30 April 2012  |  Love thisLove  3 loves
  • CuNNaXXa
    Love rating 362
    CuNNaXXa said

    I drive a Mondeo 2 litre diesel, and have to say that contrary to what a lot of people think, it is quiet, smooth and comfortable. I also do a round 160 miles a week, and get an average of about almost 54 miles to the gallon (I keep the air con switched off).

    The Mondeo costs around £190 a year to service at my local garage, who just happens to be a 4x4 diesel specialist. It would cost a lot more at a Ford dealer, even though there is no difference between a main dealer service and a non franchise service (they both service to the same standard).

    My Mondeo had only done 33,000 miles when I bought it for a touch over £8,000. It is also only just over 4 years old. It would have cost £24,000 new, yet residuals mean that the Mondeo is a second hand bargain.

    There are plenty of fleet cars that have done high mileages, yet have been looked after, so there is plenty of choice.

    I also have to say that while diesels can be more difficult to maintain, not all diesels have issues, and I have had three that have been excellent. I had a 2 litre Jag X Type which performed exemplary, then a Grand Cherokee 2.7 litre, which was actually quite a guzzler (25 to 30 mpg), and now a Mondeo.

    I do agree, though, that if you are a low mileage user, a petrol is the better option. My mother has a KA. As she only does about 50 miles a week, if that, having a diesel would prove detrimental.

    Then again, I also pull a folding camper that weighs around 1,000 kilogrammes. The natural choice for pulling any load, especially heavy caravans, is a diesel, simply because of the torque a diesel delivers. You can pull a caravan with a petrol, but it is preferable to use a diesel. After all, how many tractor units are petrol driven? None.

    So the choice of diesel or petrol just isn't about mileage or mpg. It is also about usage. If you do a lot of towing, a diesel is the natural choice. If you do a lot of mileage, a diesel is a natural choice. If you want performance, a petrol is a natural choice. If you are a low mileage user, a petrol is a natural choice.

    Then again, people often choose not what is natural, but what they aspire to. I once had a 5 litre V8 Merc, because I wanted one, even though the average mpg was only 25, and when I put my foot down, dropped to about 17, with tyres costing over £1,000 a year.

    So, the argument for many is really a moot point. I should also point out that I wanted the Mondeo because it has one of the largest boots in its class. Oh, and I like the look of the Mk IV Mondeo.

    See, not everything can be dictated by maths...

    Report on 30 April 2012  |  Love thisLove  1 love
  • silkycat
    Love rating 37
    silkycat said

    CuNNaXXa talks the most sense here. I was a confirmed petrol driver for 35 years until 2005, but no fancy cars for me. I bought a 6 year old Skoda Felicia 1.8 diesel estate. It only cost me £1500, so no depreciation problems, and in all conditions gave a constant 50mpg. At the time I was doing 13,000 miles a year. The savings over a petrol version were significant.

    The only major expense was a new set of glow plugs at 120k in the hard winter of 2010/11, but I don't know what I would have spent on spark plugs for a 1.6 petrol over that same period.

    The main drawback was sluggish performance and a fair bit of 'tractor' noise from the old 1.8VW engine. However other than the glow plugs it was utterly reliable and was a superb load carrier when required. Insurance costs were low ( not any more than my old 1.3 petrol Escort), but as it was a pre 2001 car tax was high at £240 per year.

    So when it came to replacing it last year I was looking to improve on the drawbacks. Firstly having selected a car, buying at the right price, I got a 3 year old Nissan Note 1.5diesel at just under £7.5k with 28,000 miles on the clock. This was less than some of the equivalent 1.6 petrol models.

    Secondly performance:- I chose the 103bhp model with lively performance and a 6 speed box. Yes, noisier than a petrol model but much much quieter than the old Skoda.

    Thirdly:- Tax down from an eye watering £240 to £115.

    Fourthly:- Mpg never below 56 and with careful driving, on a long journey using top gear most of the time, I can get up to as much as 65mpg.

    Don't know about servicing and repairs yet as it isn't due for a service until MOT time in September and no breakdowns so far. I'd never go to a main dealer for servicing as their prices are far too high.

    My only concern is what is going to happen to diesel prices long term. Hopefully there will be increased refining capacity to keep up with demand, and there is likely to be pressure from the haulage industry to keep prices down. Perhaps fall off in demand for petrol is keeping prices artificially low?

    Report on 30 April 2012  |  Love thisLove  0 loves
  • Klawman
    Love rating 17
    Klawman said

    An important factor is how often you change your car. Diesels - as noted above - keep their value (much) better and hence their trade-in value is higher.

    And if you keep a car for a long time, the extra fuel savings soon mount up. The wife's ancient Audi A2 1.4TDI achieves over 50mpg in town, 80 mpg on motorways and costs pence to run.

    I really liked my V6 Mondeo and its snarly engine - but fuel costs and depreciation were a killer. I replaced it with a BMW 330D - which was faster, vastly more economical, and depreciated far, far less.

    The extra torque of a diesel engine translates into more usable acceleration on the road. Remember when Top Gear tested a 3-litre BMW diesel versus its 4.4 litre V8 petrol stablemate? The V8 was quicker off the line - after that, the smaller-engined diesel had no trouble in keeping up with its gas-guzzling V8 cousin on the TG test track.

    In terms of "greeness", diesels - even those with particle filters - emit a lot more of the harmful PM10 particulates than do petrol engines. To me, it's this ecological consideration that argues most against diesel. Otherwise, it's a no-brainer.

    And while CO2 is indeed a plant food, we're producing a lot more than the world's plants can use. Why else do you think CO2 levels are rising year-on-year, logical_one?

    Report on 01 May 2012  |  Love thisLove  0 loves
  • publicspirit
    Love rating 57
    publicspirit said

    Klawman...........logical_one was stating the same facts as you on diesels producing more pollution than petrol driven vehicles. The point on CO2 plant food is that we don't, in truth, know what CO2 levels would produce e.g. the best crop yeilds. What we do know for certain is that CO2 levels in the prehisoric periods when there was extensive lush growth of vegetation (to feed huge herbivors) were very much higher than today's rather miniscule 393 ppmv. Deforestation may have more to do with residual atmospheric levels than emissions but in all likelihood both help.

    It is hard to tie any CO2 levels below 2500 ppmv to anything disadvantageous to human life. If it were so, it would be dangerous to exhale close to another human.

    Report on 01 May 2012  |  Love thisLove  6 loves
  • CuNNaXXa
    Love rating 362
    CuNNaXXa said

    One other thing worth considering about diesels is their longevity. They seem to go on and on. Take a petrol car and a diesel car, both with 150,000 miles on the clock. I would question the condition of the engine in the petrol car, but wouldn't bat an eyelid concerning the diesel (as long as it had a good service history). Petrol engines do wear out a lot quicker than diesels.

    And because fleet buyers are looking for sturdy vehicles, the bulk of their purchases are diesels.

    I actually find it ironic that a Mondeo and a Fiesta of the same age depreciate differently. The Fiesta will depreciate more slowly simply because there are not an abundance of fleet cars entering the second hand market, whereas the Mondeo does have an abundance.

    Mind you, as with any choice, you need to do your homework. For example, the Mondeo 1.8 diesel does an average of 47mpg, while the Mondeo 2.0 diesel will do an average of 53mpg. You would think the smaller engine would be more economical, but it isn't. You also need to compare prices between dealers, as some price their vehicles competitively, while others take the Mickey.

    (Parkers and Glass's guides will tell you if a vehicle is competitively priced or not).

    Once you know what you want, you can start singling out vehicles for your perusal.

    Finally, don't forget colour. It doesn't matter how economical or efficient the vehicle is, if you don't like the colour, forget it, because if your purchase a vehicle that you are not entirely happy with, it won't be long before you would be looking at changing it for something more desirable.

    Report on 01 May 2012  |  Love thisLove  0 loves
  • leah AKA global leah
    Love rating 21
    leah AKA global leah said

    I bought a Citroen Xsara 2.0 HDi diesel back in 2007 for £4500 on finance (that's another story) as I DO do 200 miles a week round trip just for work, and on A1 and M62 most of the way, it makes a lot more sense to get a diesel car rather than petrol...

    Didn't actually think much about how much/little it guzzles the fuel until I went to Manchester a few weeks ago, having to drive 50mph on M62 most of the way as it had average speed cameras most of the way, on the way back it was the same, and the fuel gauge hardly moved after done over 90 miles, I was more than impressed with it.

    I think it comes down to what you use your vehicles for, and where you use it, I would not get a diesel personally if I was to drive on a "normal" road, and wouldn't go back to petrol for usage on motorways.

    Report on 05 May 2012  |  Love thisLove  0 loves
  • trackrecords
    Love rating 1
    trackrecords said

    Diesel cars have cast iron engines that are heavier so it ruin the ride and handling. Even the newest diesels pollute the air like crazy. Just look at the rear number plate of a diesel car and notice the fine greasy haze - we are breathing that filth in, and it is coating our lungs.

    So, if you want to drive along emitting a cloud of black soot then I cannot recommend a diesel car more highly...

    Report on 07 May 2012  |  Love thisLove  1 love
  • cologne2792
    Love rating 0
    cologne2792 said

    Diesel engines haven't been all cast iron for at least 10 years and many are all alloy. The issues of handling are something that existed in nineties and heavy weight power units will only spoil the ride or handling - not both. As for cleanliness FAP filters cope pretty well with particulate removal. The only time you'll see black smoke on a modern diesel is when the anti-pollution system is in regeneration mode or if it's being over fuelled. All the negative points were true...about fifteen years ago!

    Report on 07 May 2012  |  Love thisLove  0 loves
  • mrrsa01
    Love rating 1
    mrrsa01 said

    Advised by dealer when buying a new Polo to go for petrol,new diesel is fitted with a dpf and can clog up if only used on short miles cost of regeneration is not covered under warranty.

    Report on 08 May 2012  |  Love thisLove  0 loves
  • alexms
    Love rating 8
    alexms said

    the question I'd ask is diesel or LPG...

    Report on 08 May 2012  |  Love thisLove  0 loves
  • Mary 3
    Love rating 0
    Mary 3 said

    This depends very much on motoring habits. If you are high milage deisel could possibly be the best. however the extra cost of the buy and the insurance has to balanced against this, the milage per year etc. For an average sort of milage of about 1000 miles /month, taking into account cost of repairs, servicing, and replacing the vehichle petrol will always win.

    Report on 11 May 2012  |  Love thisLove  0 loves
  • Podzak
    Love rating 9
    Podzak said

    "The simplicity of a bog standard petrol car far outweighs the financial and mechanical risks of a modern diesel "

    Really?

    I did over a third of a MILLION miles in my Sierra diesel and the only jobs done on the engine were oil and filter changes and set the tappets twice!

    Where did I do wrong?

    My MKll Mondeo, faultless!

    My Peugeot 406, faultless.

    And now my 2006 Mklll Mondeo, 2.2 diesel ( 60mpg!) with 190,000 miles.....FAULTLESS

    Had yer gob m8 !

    Report on 28 June 2012  |  Love thisLove  0 loves

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