Drumming Up Demand for Diesels

Passenger diesels were a hard sell in the United States more than a generation ago. Even though the diesels of today are not those of yesterday, will the experience be different this time around?
By Ron Kotrba | July 14, 2008
While a growing number of U.S. car buyers understand how clean and efficient a brand new diesel car or light-duty truck really is, or is required to be, most people simply don't know how far diesel engines and their emissions control systems have come in the past 25 years.

In a small and unscientific survey conducted for the purposes of this article, one in six people surveyed said they would consider a diesel the next time they bought a new car. This person, who said they would consider a diesel vehicle, was the only one who made reference to the efficiency and ultra-low emissions standards making new U.S. diesels the cleanest in the world. This person said, "I'm especially interested in being part of the solution rather than the problem, and so if a diesel's efficiency, greenness, fuel [economy] and accessibility were advantageous, I believe I would consider a diesel."

The other five were not as informed and had lingering perceptions of the diesel cars and light-duty trucks that made the U.S. car-buyer scene in the early 1980s. The most common response from those remaining five individuals polled was something to the effect of, "Diesel fuel is too expensive, and diesels are dirty and gross." A couple of those people said the only diesels available were large pickup trucks and, today, they would largely be right-unless one of Mercedes Benz's many diesel options for U.S. markets were not out of price range. And then there's the Volkswagen Jetta of course, and a few others. One person who participated in the survey was asked whether they would consider a diesel if they knew it was up to 35 percent more fuel efficient than its gasoline counterparts. Their answer was an emphatic "Nope."

Whether people "know" about the improvements made in diesel technology and emissions regulations, or just perceive it, advocates don't care so long as U.S. consumers' interest and willingness to buy are heightened. Maybe promotional and marketing efforts to spread the word have not been strong enough yet.

Allen Schaeffer, executive director of the Diesel Technology Forum, says there'll be many more product choices for U.S. consumers coming out of the dealer showrooms between now and the end of 2010. "At the Detroit auto show this year, there were 13 new models announced by a dozen manufacturers," Schaeffer says. "These are new light-duty diesel models for consumers coming out in the next 18 months. And you've got to remember where we're coming from-there are not a lot of choices now so if you add one or two diesel-powered engine options that is a huge step and commitment by the auto industry to bring these models forward." The first 50-state emissions certified Volkswagen TDI has made its debut, and the VW Jetta. Schaeffer says the BMW X5 will follow this fall, also as a 50-state certified vehicle. Next year, the BMW 335 will certify. Adding in today's four choices from Mercedes, then the larger Jeep Grand Cherokee, availability is increasing steadily despite record-busting $4.69 a gallon diesel fuel prices. "You'll see options from manufacturers who never offered a diesel before like Nissan, Honda and Acura TSX with a four-cylinder diesel which displays very strong performance, and the Audi Q7 later this year," Schaeffer tells Biodiesel Magazine.

"One thing to remember is that diesel emissions regulations in the United States are the lowest in the world," says Brian Kahnert, vice president of marketing and government relations for NxtGen Emission Controls Inc. based in Canada. NxtGen developed a small-scale syngas reformer-refinery technology shrunk down and designed to fit underneath the hood of a car. The syngas mixes with fuel to help diesel particulate filters regenerate, and in nitrous oxide treatment systems could mix with the noxious pollutants to produce nitrogen and water from the tailpipe. The company hopes Tier One, exhaust suppliers to the original engine manufacturers, will pick up on the NxtGen technology.

NxtGen developed a syngas system for diesels as part of an overall emissions control strategy.
The company has been in discussions with Tier One, suppliers to the original engine manufacturers.

"We really see an opportunity to deliver a product for North America that would be compelling to both manufacturers and car buyers because it integrates the best features of things like clean fuels, biodiesel," Kahnert says. "We have a lot of prospective customers coming to us, wanting to use our systems with biodiesel and, in fact, we're going to do field trials in California later this year on biodiesel use for on- and off-road vehicles." He says for clean diesels to be accepted by U.S. consumers, the emissions controls must be hassle-free and not require driver intervention, such as filling up a separate tank with urea. "Our system does not require driver intervention," Kahnert says. "The third key part of developing a diesel product that's compelling to buyers is advanced engine controls that increase fuel economy and reduce GHG (greenhouse gas) emissions. The public wants and is interested in fuels like biodiesel, and they're interested in gaining an understanding that automobiles had catalytic converters 30 years ago and that the next generation of converters is coming to diesel engines. And it's going to require an integrative system of after-treatment and engines to improve fuel economy and reduce GHG."

Something also to remember is that, given these U.S. regulations, all these new diesel engines and light-duty vehicles coming to North America must comply with the most stringent regulations in the world. "Asian, Japanese and European manufacturers have plans to bring diesel vehicles to North America," Kahnert says. "I believe they will come to market in the next two or three years-some by 2009 and a lot more by 2011-but the question out there is, will the Big Three respond with their own diesel products? It appears they are in fact developing a new generation of light-duty diesels to be launched in North America." General Motors highlighted its new 2009 Cadillac CTS turbo diesel coming to showroom floors soon-in Europe.

The Viability Half
"We'll certainly have more available product, but it's hard to imagine a more challenging time to bring out diesels when the price spread between gasoline and diesel fuel is what it is today," Schaeffer says. "I think any reasonable person would have to say a consumer that's thinking about buying a diesel has got to pause and ask if diesel fuel prices are so much higher than gasoline, what is the payback?"

The record-high fuel prices, the situation with energy in this country as a whole, and the extremely weak dollar have forced people to reconsider their driving habits and vehicle preferences. "There's been a lot of media coverage lately, even on hybrid payback," Schaeffer says. Some of the payback from when a buyer starts to see a monetary return on his investment in the form of fuel savings versus the hybrid's higher upfront selling price, is not for 12 to 14 years into ownership, he says. "So we're starting to see a little more truth behind these alternatives (hybrids) to gas vehicles, and fuel prices are really a driving force behind that," Schaeffer says. Diesels are not excluded from mathematical investigations by U.S. consumers whose pocketbooks are hurting. Those considering a diesel will crunch the numbers. "Today, diesel is a break-even proposition," Schaeffer says. "A diesel car is about 35 percent more efficient than its gasoline counterpart. Even if diesel fuel was $1.30 more a gallon than gasoline, you're still ahead at the end of the day by choosing diesel." The price spread between gas and diesel in some places is approaching that number. "Theoretically diesel is a better deal and we're trying to get people to understand the longer-term math about the investment in diesel, and fuel prices are clearly going to influence people asking, 'Should I think about a diesel?' And once they start down that road, we can talk about the longer term benefits and payback period," Schaeffer says.

So what about the auto makers? If they see a chance to pull out, will they take it? Maybe for extraneous long-term concept models still on paper, but the time and investment it takes for an auto company to move from engineered clay molds and computer modeling to fabrication of production castings on the assembly line is long and high, and sometimes it would be easier to stop a 900,000-ton freight train in its tracks than getting an auto company to pull out shortly before production is scheduled to begin.
As far as the consumers go, Schaeffer concludes, "There's no question that with the economy and fuel prices, people are going to be nervous about bringing on these products, which are going to be using some of the most expensive fuel out there. But I don't think anybody thinks these conditions are going to persist forever."

Kahnert forecasts with surety, "Diesel is coming to North America. Almost every marketing and forecasting agency says within the next five years diesel engine use in automobiles will climb from somewhere between 2 percent and 10 percent. It's a very significant increase and people are going to adopt diesel only if it's clean and fuel efficient."n

Ron Kotrba is a Biodiesel Magazine senior writer. Reach him at rkotrba@bbibiofuels.com or (701) 738-4962.
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