ACCORDING to the latest forecast from independent automotive data providers, CAP, diesels will form 26 per cent of the market this year – 12 per cent up on 1999.

This growth has been stimulated by a combination of technological advances in diesel technology and company car benefit in kind tax rule changes. But while diesels can offer economic advantages this growth comes with a sting in the tail This is because the high volumes of used diesels due back into the market in three years will represent an over supply, forcing second-hand prices down.

Two sectors heavily affected are upper medium and the prestige brands. Among the increases in diesel proportions within the volume upper medium sector are Ford Mondeo’s growth from 16 per cent in 1999 to 36 per cent in the first half of 2002, while 82 per cent of Peugeot 406 sales are now diesels.

Among the prestige brands, 22 per cent of BMW 3 Series are diesel, compared with three per cent in 1999