Monday, November 2, 2015

Automakers struggle to bring affordable diesel cars to U.S. market

Diesel

Los Angeles Times

In hindsight, it’s clear how Volkswagen, in the 2009 model year, seemed to have nailed the elusive formula for affordable, sporty diesel cars — when none of its competitors could crack the code.

At the time, U.S. regulators had been tightening pollution controls on diesels and diesel fuel for years, culminating with the demand to cut smog-forming nitrogen oxide emissions 90% by 2010.

Other automakers, including Honda and Nissan, had tried and failed to pull off what regulators now know that VW accomplished only by cheating — an affordable and fun-to-drive car, with fuel mileage rivaling that of hybrids. The automaker passed U.S. emissions tests with illegal software.

The difficulty and expense in producing a legitimate “clean diesel” raises the question of whether the technology is viable at all for affordable cars.

Currently, only Chevrolet offers a relatively inexpensive alternative to VW’s now-disgraced diesels. And the brand’s Cruze starts at a not-so-cheap $25,660 — a big premium over the gasoline version of the same small sedan. Its sales are a tiny fraction of those of its gasoline-powered counterpart.

The rest of the market is limited to pricey pickup trucks as well as luxury sedans and SUVs from Audi, BMW, Mercedes-Benz and Porsche. Their sticker prices can more easily absorb the high cost of diesel engines and emissions-control equipment.

Mazda is the sole remaining automaker talking about bringing an affordable diesel passenger car to the U.S. market, but the project has run into years of delays as the Japanese company struggles to make a U.S.-compliant vehicle that blends efficiency with the zippy performance that is the brand’s hallmark.

Mazda’s experience illustrates why so few automakers have challenged Volkswagen’s diesel dominance in the U.S.

The small Japanese automaker likes diesels since they are quick from a stop — because of ample torque, the same quality that makes them attractive in trucks towing big loads. More than 4 in 10 of Mazdas sold in Japan are diesels, as well as about a third of sales in Europe.

Even before VW’s problems, consumer demand was low.

“I don’t think this will help,” said Jeff Hill, an auto industry expert at Boston Consulting Group. “There will be some percentage of the people who have an affinity for diesel and German cars, but it will be a sliver of the market.”

The hurdle is U.S. emissions standards.

Although diesel cars are profitable elsewhere, most automakers don’t see the payback in the U.S., said Mark Wakefield, head of the automotive practice at consulting firm AlixPartners.

“The EPA goes after soot and smog more aggressively than regulators in Europe,” Wakefield said. It about 40% more stringent on nitrogen oxide and particulate emissions, and that’s expensive to control, he said.

Read more of the original article at the Los Angeles Times.

The post Automakers struggle to bring affordable diesel cars to U.S. market appeared first on Fleet Management Weekly.


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