Kia Sportage petrol Vs diesel - not a clear-cut choice based on dollars alone
When many people compare petrol engines with diesels, they often think in terms of the ‘payback’ or ‘break even’ period. That is, the attempt to resolve the choice is made solely in terms of the distance one needs to drive the vehicle (all other things being equal) until the cost saving resulting from the diesel’s greater fuel efficiency negates the price premium originally paid for the diesel powertrain.
For most new vehicle buyers this is a fiscally flawed way of looking at the issue – however, just for kicks, I just did it to see how it panned out on a Kia Sportage Platinum. When you compare the Kia Sportage Platinum 2.4 petrol with the 2.0 CRDi diesel, the payback period works out to be an incredible 177,000km, or about 12 years of average Australian driving. That’s four-and-a-quarter-ish laps of planet earth, subject to finding a suitable circumferential road and doing nothing for 12 years other than driving laps of it. It begs an obvious question: why would anyone be dumb enough to buy the diesel? (That’s the sole question the ‘payback period’ modellers pose, anyway.) Meanwhile, back on earth, the issue is more complex than that.
Diesel has hung up its outdated image. These days it's often the 'performance' option, in a model range
The Kia Sportage's ‘break-even period’ modelling involves a few assumptions. I used $1.35 as the price of 91 RON ULP and $1.43 for the diesel, per litre, though that would fluctuate and probably trend substantially upwards over the time you owned the Kia Sportage. (It was independently reported as the prevailing price of the fuels in Sydney on the day of writing.) I also used the official combined cycle fuel numbers as reference points, even though actual fuel consumption would probably vary depending on a range of factors, such as driving style, load and environment. Even so, at least the official combined cycle fuel numbers are the result of laboratory-standardised tests that make relative comparisons (if not absolute ones) easy.
It remains an interesting, understandable proposition: Why buy a diesel if you’re going to have to hang onto the vehicle until it’s basically tired-to-worn-out for the ownership economics to tip mildly in your favour?
Although diesel is more expensive, the engine's greater efficiency eventually yields cost savings
I recently advised a caller on Radio 2UE to consider buying a particular Subaru Forester diesel SUV, which I thought would suit them after some discussion about a range of usage factors, and within minutes another caller had rung in to contest that advice, using the whole ‘not economically rational,’ ‘break-even point’ argument. It’s a position many people take on this issue. Unfortunately, it stops plenty of people who really should buy a diesel vehicle from buying one, and it’s largely irrelevant.
There’s a $3000 price premium for the Sportage diesel. It’s $35,990 for the 2.4 petrol SLX and $38,990 for the 2.0 CRDi (RRP/MLP). Most, but not all, diesels are $2000-$3000 more expensive than their petrol counterparts. The engines are somewhat more complex than comparable run-of-the-mill petrol engines, with turbochargers and 200-atmosphere fuel rails, higher cylinder pressures, precisely machined injectors, etc. Modern diesels develop more torque (and consequentially require higher-spec drivelines) and perhaps the R&D cost of integration into particular platforms is amortised over a smaller total production volume, yielding a higher asking price.
Above: An example of perhaps embracing Diesel over-enthusiastically
The first reason you might actually prefer the diesel – despite paying the big bucks for it – is simply its superior performance, and greater practicality. The 2.4 petrol in the Sportage makes peak outputs of 130kW @ 6000rpm and 227Nm @ 4000rpm. The diesel makes 135kW @ 4000rpm and 392Nm from 1800-2500rpm. So the diesel is basically line-ball on power but offers a massive 73 per cent torque upgrade. And those lower revs for the peak torque production make for effortless performance in traffic, during ordinary driving, and when towing. It would be impossible to spend $3000 in the aftermarket industry and reliably boost the performance of the 2.4 petrol engine to the same level – and even if you could it would void the warranty.
Often, people think nothing of optioning a better petrol engine in a two-engine lineup – at a premium of several thousand dollars. The better engine invariably offers substantially worse fuel economy in exchange for superior performance. And that often seems like a pretty good deal. The diesel is even better, offering better performance while drinking less juice.
Fuel range is a major factor in remote area travel. Diesels offer reduced CO2 emissions, too, but often emit other, more detrimental exhaust particles
Practicality: The Sportage diesel’s official combined cycle fuel consumption is 7.5 litres per 100km. The 2.4 petrol drinks 9.2 litres per 100 km to the same standard. Using those numbers as a benchmark, the Sportage’s 55-litre tank will take you about 600km with a petrol driveline and about 760km in a diesel. The diesel confers something of an advantage for long-distance travel – especially at night, where fewer servos might be open in regional backwaters. But it is also a plus in the city – where you’ll get to visit a servo five fewer times per year, on average, in the diesel. (I guess how big an advantage this really is depends on you, and how deeply the notion of queuing for that two-for-one Kit-Kat deal of the century appeals…)
That’s the practicalities. When it comes to the economics of ownership, however, most people who buy a new Sportage won’t pay in cash and hang onto the vehicle for 12 years until – or beyond – until the payback period for the diesel powertrain has elapsed. Most people who buy any new vehicle back up and buy another one in three to five years. Because they can.
Diesel's extra touring range will come in handy if the servo you stop at looks like this, and the next one is 100km away
So let’s look at the petrol V diesel ownership economics a different way, in light of that general ownership experience. Let’s assume you finance the vehicle at a fixed 12 per cent and finance $35,990 for the petrol or $38,990 for the diesel. Let’s assume you pay the on-roads in cash, just to take that variability out of the equation. Let’s assume you finance the vehicle for five years at 12 per cent, with a conservative 20 per cent residual payment at the end.
If you do all that, repayments will be $705.39 monthly for the petrol and $764.19 for the diesel. At the end of the five years the total payments will amount to $42,323.40 for the petrol and $45,851.40 for the diesel. So the finance company will manage to extract about $3500 more from the diesel owner’s pocket – but remember this is mitigated to an extent by the saving in fuel, and the diesel’s higher probable resale price.
Fuel? Assuming the fuel prices above, the fuel bill for 15,000km per year times five years is going to be $9315 (petrol) and $8045 (diesel). Here, the diesel owner saves $1270.
You'll see this view (above) five times less often annually in the diesel Kia Sportage than in the petrol
After five years, the Kia warranty runs out, you make your balloon (residual) payment, and then sell the vehicle. Let’s assume you sell it privately, which will generally yield you more cash than trading it in. Comparing a similar vehicle, the Hyundai Santa Fe, on www.redbook.com.au leads to the conclusion that the Sportage’s resale value (for private sale) will be about 50 per cent of the vehicle’s RRP after five years, with little if any difference in percentage between petrol and diesel variants. Both powertrains lose about 50 per cent of their new RRPs at five years of age. (Comparable data for five-year-old Sportages isn’t relevant, as there was apparently no diesel back then.) Therefore, you could list your used Sportage on www.carbuddy.com.au and shortly thereafter pocket $18k (petrol) or $19,500 (diesel) in cold, hard cash.
Interestingly, the diesel owner gets half his original $3000 price premium back in resale, a fact the ‘break-even point’ analysts rarely pause to consider.
Sadly, diesels generally cost more to service. So let’s also factor in $1000 for a servicing premium on diesels over the five years of ownership – assuming an average $100 more to service the diesel, per service, twice a year, every six months for five years.
Above: a major objection to diesel, typically among women, is the often-filthy pump nozzle and the lingering odour 'eau de diesel' that becomes ingrained in your hands as a result
When you whip all those numbers into a spreadsheet, here’s the difference in ownership cost, over five years: The petrol is the winner, but only by $2360.00. That’s about $470 annually, or $9 a week – or $1.30 per day. Slightly more than the cost of the newspaper. Three regular-sized lattes a week. A moderately decent bottle of wine a fortnight. A super-sized Mc-Somecrap meal a week. You get the point. For people who can afford a new vehicle, the extra cost of the diesel powertrain is trivial. It’s not like we’re talking the poverty line here.
Above: Are you prepared to 'shell' out more for diesel? (Sorry)
And it’s not as if there aren’t direct benefits to the diesel ownership experience. If you invested that price premium in a diesel Sportage, over five years you effectively bought yourself 25 fewer stops at a service station, and you had access to 73 per cent more torque whenever you needed it – a serious performance and practicality upgrade considering the price.
Overall, despite the slightly higher cost, diesel seems to deliver a pretty good return on investment.
What do you think: The petrol or the diesel?