DETROIT - The diesel engine is back.
Five automakers revealed plans at the North American International Auto Show to introduce fuel-saving diesel engines in cars and trucks.
Mercedes-Benz confirmed that it will introduce five diesel models beginning this fall. Honda, BMW, Nissan and the Chrysler group each confirmed plans to add diesels to their lineups over the next three to four years.
"All vehicle manufacturers are at least looking at the possibility of adding diesels to their cars and crossovers," said Anthony Pratt, senior manager for global powertrain forecasting at J.D. Power and Associates.
In the early 1980s, diesels virtually vanished from U.S. cars because of strict emissions standards and issues such as noise, smoke and reliability. In the United States, Volkswagen is the only manufacturer that consistently offered diesel-powered cars.
Now, cleaner fuel and breakthroughs in fuel injection and emissions technology are giving diesels a second chance. In 2005, Volkswagen sold more than 29,000 diesel-powered cars in the United States, and a top company executive said last week that the company could have sold even more.
Good fuel economy
"We could have sold half our (Jettas) as diesels," said Adrian Hallmark, executive vice president of Volkswagen of America.
The diesel's return comes after 18 months of record gasoline prices. Diesel engines generally deliver 25 percent better fuel economy than their gasoline counterparts.
Heavy-duty diesel pickups have proved popular here, but hybrid-powered vehicles dominate the market for fuel-efficient cars, in part because they generate better environmental buzz. Consumers are willing to pay a premium for the gasoline-electric Toyota Prius and Ford Escape Hybrid.
Several factors have convinced automakers that diesels are poised for a comeback. In September, low-sulfur fuel will be available in the United States. That, along with improvements in engine technology, will allow diesels to meet stringent new emissions standards in 2009.
Also, a diesel engine is less complex to design, manufacture and service than a hybrid powerplant. Diesels are easier to install in existing vehicles, and their price premium of $3,000 to $5,000 is no greater than that of hybrid engines.
J.D. Power forecasts U.S. diesel sales will grow to 9 percent of light-vehicle sales in 2012, up from 3.2 percent last year.
Mercedes plans to boost its diesel lineup to five vehicles. The current mid-sized E320 CDi diesel sedan will be replaced by a new version with a new engine. Since this diesel sedan was introduced in mid-2003, Mercedes has sold 8,000 units.
That vehicle will be joined by the GL320 and ML320 SUVs and the full-sized S320 sedan and R-class sport wagon.
All will be powered by a new four-valve-per-cylinder V-6 diesel engine. And all will have a new emissions system Mercedes calls BlueTec.
DaimlerChrysler AG CEO Dieter Zetsche introduced BlueTec at the Detroit show and said it eventually will enable Mercedes to offer diesels nationwide. "BlueTec is ready for all 50 states, and can even meet 2009 emissions standards," said Zetsche.
BlueTec is a combination of emissions technologies that will be rolled out in two phases. The Mercedes diesels coming this fall will be available only in 45 states. They'll use traps and filters in the exhaust system.
Then, in the fall of 2008, BlueTec will add a urea-injection system that will reduce oxides of nitrogen.
Urea injection will enable Mercedes to sell its diesels in California, New York and at least three other states that have adopted California's clean-air standards.
Zetsche said the Chrysler group's vehicles also will use BlueTec. At the Detroit show, Jeep displayed a diesel version of the Grand Cherokee equipped with BlueTec.
Bob Lee, Chrysler group's vice president of powertrain engineering, declined to say when or if the Grand Cherokee would get a diesel. A diesel version is on sale in Europe.
A diesel Grand Cherokee would be the second Jeep with a diesel. With almost no marketing, the Jeep Liberty diesel that went on sale early last year sold nearly 8,000 units, beating a projected volume of 5,000.
Mercedes has sold nearly 8,000 E320 diesels since the car went on sale about 18 months ago, despite being shut out of California and New York.
BMW will have a diesel in the United States by 2008, said Burkhard Goeschel, BMW board member for purchasing and development.
He would not say which model BMW will offer. But if BMW follows the trend, it would put a diesel in something large and fuel-thirsty, such as the X5 SUV or 7-series sedan.
Nissan plans to put diesels in its Titan pickup and large SUVs, such as the Armada and Infiniti QX56.
"I think you can expect us to have in the next five years a serious diesel offer," said Nissan CEO Carlos Ghosn. "I think it is going to start with large trucks - with SUVs and trucks. There is no reason for us not to be present in any segment of the U.S. market. Eventually we will be everywhere."
Unlike BMW, Nissan does not have a ready supply of truck diesels. But it could source an engine from International Truck & Engine Co., Detroit Diesel or another supplier.
Honda Motor Co. is developing diesels for the United States. Honda already offers three gasoline-electric hybrids in its lineup.
First, Honda will introduce a four-cylinder diesel for use in cars or light trucks. Honda wants to sell diesels in the United States by the end of the decade. Honda sells a diesel Accord in Europe.
"The U.S. is our most important market and a top priority for diesels," says Motoatsu Shiraishi, Honda's president of research and development.
Toyota executives have all but confirmed a heavy-duty diesel engine for the next generation of the Tundra pickup. Toyota does not build a truck-sized diesel engine, but it could adapt an engine produced by its truck-making affiliate, Hino Trucks.
While some import automakers are ready to install diesels in cars, the Big 3 are betting on big trucks. General Motors won't install diesels in cars or small trucks unless consumers demand them, says Tom Stephens, GM's group vice president for global powertrain.
"We do not see an affordable way to implement that technology," said Stephens. "But if the market demands it, I'm there."
For now, Ford also is confining its diesels to heavy-duty pickups.
Suppliers of diesel components, such as Denso Corp., Delphi Corp., Siemens VDO Automotive and Robert Bosch GmbH, expect a big uptick in North American sales.
"We have a strong desire and prediction that light vehicles - SUVs ahead of cars - will have diesel technology," says Mitsuo Matsushita, CEO of Denso International America Inc. "It could grow to as much as 7 percent of the market in 2010."
But diesels won't catch on in the United States unless gasoline stations add more diesel pumps and refiners produce low-sulfur fuel, said Volker Barth, president of Delphi Europe.
Mike Jackson, CEO of AutoNation Inc., believes diesels will catch on in cars. "Diesels have made fantastic strides," Jackson says. "They have great performance, tremendous torque, which America loves, plus the fuel efficiency." c
Diana T. Kurylko, James B. Treece, Bradford Wernle, Kathy Jackson and David Kushma contributed to this report