Clean Diesel Makes Inroads in the U.S.; Sees Slowdown in Europe

Tim_Dunne

Tim Dunne

As clean diesel powertrains become more prevalent and popular in the U.S. market, especially in VW and Audi brand product lineups sold here, it appears that diesels are becoming less attractive in the world’s largest diesel market: Europe, according to a recent article, “Are Diesel Cars in Europe Starting a Long Slow Decline?” in Green Car Reports as well as J.D. Power research.

The current reduction in diesels in Europe may be mainly due to new regulations that have been passed by the EU and/or are being considered in individual European countries.

As recently as 2012, the diesel share in the European market was 46.0%, according to Mike Omotoso, senior manager of global powertrain at LMC Automotive, J.D. Power’s strategic partner. In 2013, LMC Automotive projects the diesel share to edge down by slightly more than 1 percentage point to 44.9%, and the outlook for 2014 is for a 44.0% diesel share in Europe—down 2 points from 2012.

In addition, research in Germany finds that less than one-third (29.8%) of vehicle owners surveyed by the German Automobile Club at the end of 2012 said the next car they probably will purchase might be powered by a diesel engine.

Alternative Powertrains are Still in Some Europeans’ Consideration Set

14-Mazda-6-04However, at the same time, owners do express interest in considering other alternative powertrains in their next vehicle. Although less than 1% of respondents in the German Automobile Club Survey said they now own a hybrid, 11% say they most probably will purchase a hybrid for their next vehicle. In addition, there were a small but slightly higher percentage of owners who intend to buy either a natural gas or electric-powered vehicle, according to German Automobile Club research.

The new diesels are much different from the engines in the 1990s. The diesel engine, which in August celebrated its 120th year since it was invented, has become more refined with direct injection, turbocharging and sequential turbocharging to improve both performance and fuel efficiency.

Although these clean diesel engines aren’t as dirty or noisy as previous diesels (new- generation diesels emit fewer hydrocarbons and less carbon monoxide than a gasoline vehicle) they do discharge greater amounts of nitrogen oxides and particulate matter than gasoline engines.

That’s why new “Euro 6” emission standards in 2014 will require diesels to have filters for urea injection and diesel particulates that will add to a diesel engine’s cost. In the U.S., these urea injection filters are fitted on every passenger diesel vehicle sold here excluding the VW Jetta and Golf and 2014 Mazda6 Diesel. Even more strict rules are under discussion for Europe, which could make the cost of diesels not worth the extra money in comparison to cheaper gasoline-powered vehicles that also are becoming more fuel efficient.

13-Volkswagen-Golf-TDI-02Volkswagen is a strong proponent of diesels and says that in 2013 it has sold more than 47,000 TDI Clean Diesel vehicles in the U.S.—nearly one-fourth of the vehicles it sells in America. Europe’s largest automaker also says that its diesel sales account for nearly 75% of all diesel light vehicles sold in the U.S. In fact, in July, one of three VW buyers paid an extra $2,000 for a diesel powertrain and diesels accounted for 30% of the VW brand’s sales and set a record, according to Automotive News.

It is likely that clean diesel powertrains will make up one spoke of the alternative powertrain wheel in the future. More than one-third (36%) of new passenger vehicles in the world market will be equipped with alternative powertrains, according to a forecast from LMC Automotive [click on GAB post]. A majority of these new vehicles are likely to be hybrids (17.5%). However, vehicles with diesel powertrains are expected to comprise a respectable 10% share of worldwide sales, especially since diesel is still gaining in popularity in other large markets, such as India.Tim Dunne, director of global automotive  industry analysis and Philly Murtha, editor at J.D. Power

 

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