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Diesel Engine Growth in the United States Remains Constrained by Buyer Perceptions

Latest study reaffirms that fuel prices and urea maintenance turn off most potential buyers.

by on Apr.14, 2009

Volkswagen remains committed to selling diesel engines in the U.S. while other makers waffle.

Volkswagen remains committed to selling diesel engines in the U.S. while other makers waffle.

While some consumer attitudes toward diesel engines are becoming more favorable, roughly two-thirds of potential buyers still will not consider the expensive engines for their next vehicle. 

According to the Morpace Powertrain Acceptance & Consumer Engagement (PACE) study, 62% of new vehicle owners feel that diesel powered vehicles have “gotten better” over the past 10 years. And 35% now say they will “consider” clean diesel technology for their next vehicle because of perceptions of improved fuel economy and greater environmental friendliness. Small car owners, not surprisingly, show the least interest in oil burners. Owners of gas-guzzling luxury cars and full-size pickups are most likely to consider “clean” diesel.

Diesels have certainly been popular in Europe where lavish subsidies exist for the fuel or in tax reductions for vehicles that use diesel fuel. They now account for about half of all new motor vehicles sold there each year. In this country, diesels account for well under 5% of the market, though the market research firm, J.D. Power and Associates, perhaps influenced by its European-based clients, says the figure could reach 15% – 20% by the middle of the next decade.

Mercedes-Benz plans to introduce a new Bluetec version of its E350, shortly after the launch of the gasoline-powered 2010 E-Class sedans and coupes, later this year. The E350, which will meet the toughest emissions standards in all 50 states, provides V-8 like performance but V-6 fuel economy. The company is also considering an E250 4-cylinder diesel for the U.S. that would provide V-6 levels of horsepower and torque, but fuel economy estimated at 44 mpg. That would meet or exceed the mileage of the best hybrid models in its mid-size segment, but still offer substantially better performance, according to the automaker, which missed the move to hybrids by its Japanese competitors, notably Lexus.

Audi will launch its first “clean” diesel, the Q7 TDI, later this month for $50,900, officials have announced. The Q7 is expected preview an assortment of new Audi diesel-powered vehicles, despite growing skepticism about the role of the high-efficiency engines in the American marketplace. Audi too missed the hybrid revolution.

“While the perceptions of diesel have changed for the better, consideration of clean diesel vehicles is hampered by the high cost of diesel fuel compared to gasoline,” says Bryan Krulikowski, author of the Morpace study. (more…)