Foreign automakers are preparing to launch a wave of clean-diesel cars in the United States and Detroit doesn’t seem to have a response.
“This is the perfect storm for clean diesel-powered cars,” says Allen Schaeffer, executive director of Diesel Technology Forum,”Diesel engines are a proven technology that never took off. We are now in a climate where people are focused on energy, and diesel is energy-efficient. This is the perfect time to bring out diesel.”
Acura, Nissan, Hyundai, Kia, BMW, Acura, Audi, Porsche and Volkswagen all plan to launch clean-diesel cars in the U.S. by 2011 and many already have models in production. Notice the lack of American names from that list.
It could have something to do with the fact that in Europe, 50 to 60 percent of the cars are powered by diesel engines versus barely 3 percent in the states giving European automakers a definite edge on production and subsequent sales in the states.
Regardless of the angles current diesel vehicles are now as clean as any other gas powered car on the road, if not cleaner, and 25 to 40 percent more fuel efficient. In 2006, the Environmental Protection Agency required the introduction of ultra-low-sulfur diesel effectively removing the highest polluting portion of diesel fuel and helping ease its stigmatic association with the black stinky smoke that bellows from commercial trucks and buses.
Bleeding money and jobs, Detroit appears to be banking heavily on positioning themselves with efficient gas powered cars and latching on to the hybrid craze ignited by the Toyota Prius instead of pushing clean-diesel cars of their own.
Ford’s 2009 Fiesta ECOnetic clean-diesel car puts up 65 mpg, but you might not have heard of it because it isn’t sold in the United States, but Europe.
The ECOnetic emits less C02 than a Toyota Prius and has a better highway fuel economy. Deduct the $1,300 tax credit available to American buyers of new diesel cars until the end of 2010 and it could be possible to bring the ECOnetic’s estimated $25,700 US price tag down to a competitive level with the uber-popular Prius, which usually sells for about $24,000. And yet, the ECOnetic is lost on American consumers.
“We know it's an awesome vehicle but there are business reasons why we can't sell it in the U.S,,” said Ford America President, Mark Fields in a September 4, 2008 article in Business Week, “We just don't think North and South America would buy that many diesel cars.”
At the time that may have been true, but times are changing as evidenced by the burgeoning influx of foreign clean-diesel cars into the U.S.
“We expect diesel in the U.S. to increase from 3.2 per cent of the market in 2007 to 3.6 per cent this year and reach 10 per cent market share by 2015,” says Mike Omotoso, senior manager of powertrain forecasting at auto industry analyst J.D. Power and Associates, “Despite all of the publicity surrounding hybrid vehicles, diesels have outsold hybrids in the U.S. by a large margin, we expect that to continue as the European manufacturers introduce more diesels in the U.S. market.”
Bah! The engines for Ford’s ECOnetic are manufactured in Britain and it would cost Ford nearly $350 million to construct another production factory in Mexico to reduce labor costs for sale in the United States. At that price Ford would need to sell 350,000 ECOnetics per year to make the venture profitable.
Instead, Ford plans to produce a gas-powered version of the Fiesta in Mexico slated for release in the U.S. by 2010. The 1.6-leter four banger would produce a fuel economy in the high 30s, roughly half that of the clean-diesel version.
Maybe Ford shouldn't have passed on that check from the bailout.