Dark Horse Diesel

Could German clean-diesel tech edge our hybrids and EVs in U.S. market?

2 min read
Dark Horse Diesel

Though about half the automobiles in Europe are diesels, the technology has never had much traction in the United States, partly because much stricter U.S. clean air regulations made it virtually untenable. But several years ago Daimler and Volkswagen introduced cars powered by clean diesel technology capable of meeting U.S. requirements. (Such cars include a diesel version of VW's Jetta, [seen above], its Golf, and the Mercedes ML 350, GL350 and R 350; a useful online primer on Daimler-Benz's BlueTEC diesel technology is available on the auto company's site. ) Initially the new cars didn't seem to be making much headway. Sales numbers in recent months, however, are beginning to turn heads.

During the first eight months of this year, clean diesel sales in the United States increased by almost four times as much as overall car sales--37 percent versus 10.4 percent. In each of the five months from April through August, the growth in clean diesel  sales far exceeded growth in sales of hybrid electric cars.

A number of factors, to be sure, have distorted the hybrids market: the Japanese tsunami and earthquake, which disrupted production; a unusually strong Japanese exchange rate, which has made it advantageous to sell hybrids in the domestic market rather than export them; and so on. As a result of such conditions, just 9500 Toyota Prius vehicles were sold in the United States in August, compared to 18,600 in March.

Still, the numbers and the trends are arresting. 8,808 clean diesel units were sold in the United States in August, compared to 21,177 hybrids and 1,664 plug-ins (both plug-in hybrids and EVs). Compared to August 2010, hybrid sales were down 12 percent and clean diesel sales were up 20 percent. According to the Clean Diesel Forum,  analysts Baum and Associates predict that clean diesel cars will account for 6-6.5 percent of the U.S. market in 2015, compared to about 3 percent now. JD Power  & Associates expects diesels to be 7.4 percent of the market in 2017.

This may be a rare case where industry analysts turn out to have been too conservative and pessimistic. Couldn't clean diesels, having come around the outside track,  be dominating the U.S. market by 2025? Might not half of Americans be driving diesels, just like in Europe? Could the hybrid turn out to have been just a fascinating passing phase and the EV a slightly silly idea? We're not saying all that's going to happen, but we're not saying it's out of the question either. (Let's not forget that barely more than ten years ago fuel-cell-powered vehicles were all the rage.)

In turns of image, admittedly, clean diesel still has a way to go. Mercedes-Benz has Hollywood actress Emmy Rossum--that's Emmy who?--plugging BlueTEC. Tesla Motors has George Clooney. But hey, unfortunately it turns out you have to be just about as rich as Clooney to drive a Tesla. You--I'm sorry, who did you say you were?--might actually be in a position to drive a Mercedes ML350.

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EVs have finally come of age. The total cost of purchasing and driving one—the cost of ownership—has fallen nearly to parity with a typical gasoline-fueled car. Scientists and engineers have extended the range of EVs by cramming ever more energy into their batteries, and vehicle-charging networks have expanded in many countries. In the United States, for example, there are more than 49,000 public charging stations, and it is now possible to drive an EV from New York to California using public charging networks.

With all this, consumers and policymakers alike are hopeful that society will soon greatly reduce its carbon emissions by replacing today’s cars with electric vehicles. Indeed, adopting electric vehicles will go a long way in helping to improve environmental outcomes. But EVs come with important weaknesses, and so people shouldn’t count on them alone to do the job, even for the transportation sector.

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