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Diesel Popularity Could Grow in U.S. in Coming Years, Analysts Say

Diesel vehicles are no longer taboo in the U.S., and The Detroit News reports that consumer interest in the oil-burning alternatives could continue to grow in the coming years.

The public’s renewed interest in diesel vehicles was sparked by the reintroduction of diesel cars by German automakers like Volkswagen, Mercedes-Benz, and BMW. Other automakers in Europe, such as Jaguar, are reluctant to offer their diesel models in the U.S.; but big-time player General Motors is eager to get in on the diesel action, as the company plans to bring a diesel version of the Chevy Cruze stateside for 2013. Mazda also plans on bringing a diesel-powered model to the U.S. in the same year. With more diesels on the way, some analysts suggest that this once frowned-upon powertrain option could finally be ready for primetime.

Robert Bosch LLC, the company that supplies many automakers with diesel injection systems and other components, expects diesel sales to grow to 10 percent of the U.S. market within the next decade. Such growth could be facilitated by rising gas prices, according to analysts who say the percentage of diesel car buyers would rise if regular gas prices surpass that of diesel fuel. For now, though, their forecasts are less optimistic.

“We’ve seen a little bit of movement, but it’s still limited to the German carmakers,” Mike Omotoso, powertrain expert at J.D. Power & Associates, told The Detroit News.

Though modern diesels are generally more durable, produce more torque, and deliver 20 to 30 percent better fuel economy on average compared to their gasoline counterparts, they’re also more expensive, commanding a $2000 to $4000 premium. Another obstacle preventing diesels from really catching on is the cost of the fuel itself. The Detroit News reports that as of last Friday, diesel fuel cost about 65 cents more per gallon than regular unleaded fuel on average across the nation.

Despite those extra costs, diesels are still finding an audience with U.S. buyers. Volkswagen reported a 37-percent increase in diesel vehicle sales in October compared to the same month last year. The German auto giant offers several diesel models in the U.S., including the Golf, Jetta, Touareg, and the new-for-2012 mid-size Passat. Still, some analysts say that car shoppers aren’t likely to flock to diesel-powered vehicles in large numbers. Those analysts believe that diesel cars, much like hybrids, are likely to remain niche vehicles in the U.S. market.

Not helping the argument for diesel cars is the recently proposed 54.5-mpg fuel economy standard for 2025, which includes many incentives for hybrid and electric vehicles, but none for diesels. VW and Mercedes-Benz parent company Daimler AG have refused to stand behind the proposed standards, though 13 other automakers, including Honda, Hyundai, and the Detroit Three voiced their support for the magic 54.5-mpg number in July. With little help from the federal government, diesels may have a harder time entering the mainstream in the U.S.

Fighting an uphill battle is nothing new for diesel-powered cars in the U.S. though, and for a few enthusiasts, going diesel is about more than just saving money on fuel anyway. Do you think the government is making the right choice siding with hybrids and EVs? Do you think the government should take a more “technology-neutral” stance as long as efficiency goals are being reached? Should automakers pursue diesel powertrain development, or shift their attention to downsized, turbocharged gasoline engines and electric drivetrains? More importantly, what would you rather buy? Does a diesel-powered vehicle’s high fuel economy and torque-happy nature outweigh the higher fuel costs for you? Give us your take on the future of diesels in America in the comments section below.

Source: Detroit News

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