U.S. Automakers Hope to Boost Diesel Profile

Can new diesel-powered vehicles coming to market by automakers such as Chevy and Jeep boost the fuel's widespread adoption in the United States?

February 11, 2013

CHICAGO - Diesel in the United States is nowhere near the level of demand in Europe, but a handful of automakers are hoping to change that.

USA Today reports that new fuel-efficient new models, including the Chevy Cruze compact and Jeep Grand Cherokee SUV, are gearing up to change American attitudes toward diesel. However, the clock is running, notes the news source, saying that if Chevy, Jeep and Mazda and crack the code on diesel in the U.S., "t probably can't be done."

On the positive side, diesel vehicles enjoy a 20% to 30% higher fuel economy than comparable gasoline engines, notes USA Today, and unlike some hybrid models, diesel??s "real-world fuel economy is often higher than its EPA rating."

On the negative side, the news source writes that diesel engines are more expensive than comparable gasoline engines, and that there is still a consumer perception that diesels cars are "noisy, smoky and slow." Also, taxes in certain states can make diesel vehicles are more expensive option than its gasoline-powered counterparts.

According to Edmunds.com, diesel cars don??t seem to be on the radar screen of American consumers. Diesel cars and SUVs accounted for just 1% of U.S. vehicle sales in 2012, although it is a small gain from just 0.2% in 2007. The source notes that heavy-duty pickups and vans (nearly all were commercial vehicles) accounted for another 1.8% of U.S. sales last year, with hybrids accounting for 3% of U.S. light vehicle sales in 2012, up from 2.1% in 2011.

So can automakers give diesel its day in the United States?

"Customers are already coming into dealerships asking for Cruze diesels," Cristi Landy, Chevrolet??s small car marketing boss, said as she unveiled the vehicle last week at the Chicago Auto Show. "We expect to compete head-to-head with the Germans," specifically the Volkswagen Jetta," she added. Consumers can see for themselves how well the Cruze performs when it goes on sale in 13 diesel-oriented markets in April or May and nationwide two to three months later.

"This absolutely starts the conversation about diesels with mainstream buyers," Edmunds.com senior analyst Bill Visnic told USA Today. "These vehicles move the needle. Lots of people would like a Grand Cherokee, but they don't want the fuel costs. At 32 mpg on the highway, the diesel can draw new buyers and broaden the vehicle's appeal."

Owners have been clamoring for the V6 diesel, said Mike Manley with Jeep. "People's ears prick up when they hear about 30-mpg in a full-size SUV and a 730- to 750-mile range on a tank," he told the news source. The diesel-powered Cherokee hits dealerships early in the second quarter.

Robert Davis, senior vice president of Mazda North America operations, told USA Today at the number of Mazda customers asking for a diesel vehicle has increased from 0% to 10% in the past five years. "We expect an enthusiastic reception," he said. "The Mazda 6 will open the door to diesel for a lot of people."

As for the German automaker responsible for 91% of the 2012 U.S. diesel vehicles sold in the United States, bring on the competition.

"The more companies selling diesels, the better," Rainer Michel, Volkswagen of America vice president of product marketing and strategy, told USA Today.

C-Stores and Diesel

"As more diesel fueled-cars hit the market, there is an opportunity for retailers to promote that they sell diesel fuel," said NACS spokesperson Jeff Lenard. The recently released NACS Consumer Fuels Survey found that about three out of 10 consumers would consider a diesel fueled-car as they seek out alternative vehicles.

While about half of all convenience stores sell diesel fuel, there are still significant gender perceptions regarding its availability. Nearly twice as many men than women would consider buying a diesel-powered car, and many women cite availability as an issue preventing them from considering a diesel vehicle. While diesel fuel currently is priced more than gasoline, its better fuel efficiency still makes it an attractive option for many consumers.

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