Filed under: Green, Ford, Toyota
Analysts predict diesels to make up 20% of U.S. market by 2020
Hybrid vehicles may hold most of the headlines right now, but both analysts and industry insiders agree that oil burners will comprise a far greater slice of the automotive propulsion market by 2020. BorgWarner CEO Tim Manganello told the SAE Automotive World Congress in Detroit that diesels would account for 20% of vehicles by 2020, and both Ford product chief Derrick Kuzak and Toyota engineering vice president Ed Mantey agreed with the assessment. Manganello based his prediction on powertrain trends in Europe, which already feature diesel engines in about half of its vehicles. Hybrids were predicted to account for about 10% of the market by that time, which doesn't quite match up with the technology's considerable hype. We're all for more diesel and hybrids on America's streets, and with new oil-burners from Ford, GM, Honda and more already on the way, 20% sounds like a very attainable goal for 2020.
[Source: AutoWeek]
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Reader Comments (Page 1 of 3)
tio 8:40AM (4/15/2008)
With diesel prices jumping well above gasoline I have changed my mind on wanting a diesel at the moment. Prices here are $3.59 for gas, $4.19 for diesel.
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Chris 8:44AM (4/15/2008)
I see from 20% to a 30% cost difference meaning any oil burner I buy has to have that at a minimum over the gas burner in mileage.
In truth it is going to have to have over that, so if diesel is 30% more than gasoline I want 40% better mileage. If you factor in the fact that the initial cost will be higher as well that 10% requirement is justified, hell it might be giving points to diesel it doesn't deserve.
I figure that series hybrids - like the upcoming volt - will either make diesel worthwhile if they use a diesel to regenerate the batteries or make them moot if they continue to use gasoline or other fuels to regenerate the battery
Jared 9:01AM (4/15/2008)
Unfortunately, I have to agree that at the current pricing diesels are not economical. They cost about $2000 more to make than a comparable gas engine. The required emissions control equipment to meet Tier 2 Bin 5 reduces mileage to about 20% better than a gas engine. But the fuel costs 30% more.
I've been a big diesel fan, but the numbers aren't working right now.
Dausman 10:00AM (4/15/2008)
Still believe diesel is the better "gap" fuel of choice until a mass produced alternative fuel/ power source is developed and proven to be a viable, "economical" replacement for petroleum based fuels.
We have very, very few chioces of diesel powered automobiles at this time...there have been stories of several auto manufacturers that have diesels in the works....guess they will be have European destinations before we see them here.
Have never owned one but am holding off until we have more than a $55K choice ....I would be willing to pay the extra per gal of diesel fuel in order to gain the , in most cases, much greater mpg...with $150 per barrel of crude oil predictions the more mpg the better.
chuck goolsbee 10:27AM (4/15/2008)
The Diesel fuel I make myself costs about $1 a gallon.
My TDI gets 50 MPG.
Try that with gasoline.
--chuck
http://chuck.goolsbee.org
YouFaceTheTick 11:02AM (4/15/2008)
The massive jump in economy more than compensates for the current 10% price difference I see between premium and diesel. As time goes, the actual percentage gulf shrinks just as the jump from unleaded to premium is now only about 6%, the next leap to diesel is not even 10%. I figure by 2009 we'll see the gaps close to more like 5 and 8%.
By my house premium is 3.89 and diesel is running 4.25. If that jump means I get even 10 mpg better mileage out of a diesel, then I'm seeing a good ROI. As time moves and gas gets to $5 - figure by next year this time - then 5.30 for diesel will feel like a steal. 30% fuel economy jump, 9-10% price jump...you can see how that works out for the diesel owner.
Daniel 3:31PM (4/15/2008)
Diesel is good. Hybrids are good. Combining a diesel with a hybrid is very good!!!
We can have 80 MPG to 100 MPG cars today by combining diesel and hybrid technology. And, we don't need any changes to fuel stations. This is really a no brainer. Of course it will cost a few thousand more to combine diesel with hybrid - but it is worth every penny to get totally off foreign oil. This is the most important national security issue facing America.
Disgruntled Goat 8:44AM (4/15/2008)
So it'll be up to 20% from what? 0%? 19%? Not terribly informative. And unless the cost of the car is the same why bother buying a diesel? Diesel here is over $4 per gallon while regular unleaded gasoline is running around $3.30. If I have to pay more I'd rather have a hybrid and just not buy as much fuel.
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Gregg 8:59AM (4/15/2008)
Diesel fuel cost is the fly in the ointment. Demand for diesel is way up and will continue to grow quickly. So pressure on price may prevent the usual summer softening of diesel fuel prices. For the past few years, I could count on paying less for diesel than gasoline at least for several months of the year.
In Europe, the cost of diesel is moderated by the government, or you wouldn't see 50% of the fleet using it. This will have to be sorted out here as well. Otherwise, people will not pay a premium for a diesel car only to come out about the same overall on purchase and operating costs. Plus, what are the truckers to do, besides pass higher prices on to all of us (practically all our goods are trucked)?
geo.stewart 9:15AM (4/15/2008)
to be clear, the reason diesel prices are up is because the demand % is up. This is partly due to autos but more due to industry. US refineries produce a diesel/gas mix 20-25%/75-80%. Anyone buying a diesel is only going to make their fuel costs worse but by all means, go ahead. And its not a simple change to move the %, we are talking re-tooling and/or new refineries and we havent had any new refineries in 20 yrs.
Europe's diesel is cheaper because their refineries are set up differently and produce closer to a 50/50 mix of gas and diesel, thus the ability to produce more diesel and control pricing better.
Diesel is NOT the answer.
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pacman 9:26AM (4/15/2008)
Also in Europe gas and diesel are both wicked expensive. Its not that they control the price of diesel as much as they tax Gasoline more heavily wich inflates its cost and makes diesel comparable in price. In the US diesel is taxed at a higher rate than Gasoline
Alex 9:26AM (4/15/2008)
Diesel engines and fuel are far too expensive to justify the fuel savings, unless i had the equipment to convert WVO into biodiesel. Even then you are talking some expensive equipment and you'll need to secure a reliable source for clean WVO.
On top of the tangible barriers there is the stigma that the average consumer has towards diesel. I was talking to a relative about wishing i could get a diesel VW. Her comment: "why would you want a slow, smokey car?"
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Jesse Thoresen 9:38AM (4/15/2008)
The diesel option on my 2005 Passat TDI was only an additional $200.00. The vehicle is worth 22,000 a comparable gas Passat is worth 14,000. My 200 dollars investment is now worth 6000 dollars. That sounds economical to me.
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Jared 10:28AM (4/15/2008)
Jesse:
The problem is that your 2005 TDI will not meet Tier 2 Bin 5. Meeting that requirement costs at least an additional $1000 and significantly reduces mileage.
Automakers do not always pass along all the costs of a technology to their customers. So we'll see how much extra they will charge for the new diesels. But it is costing the manufacturers at least $2000 for each Tier 2 Bin 5 compliant diesel engine.
Further more, here in MA diesel fuel is now $4.10 per gallon. Gas is $3.10 per gallon. That is approximately 30% more for diesel fuel. Since the Tier 2 Bin 5 compliance reduces the mileage improvement to about 20%, it currently costs more per mile to drive a Tier 2 Bin 5 compliant diesel than a gas engine. Add that to the added initial cost of the diesel and it is clear that the diesel costs more to buy and drive.
why not the LS2LS7? 11:57AM (4/15/2008)
That's great. Note that the only way to make this investment pay off is to sell the car. Until then, it's just talk.
Pat 9:39AM (4/15/2008)
As a diesel owner (98 Jetta TDI), I feel I should chime in with some of the benefits of diesel. I consistently get 40 to 45 mpg in the city. My sister's Honda Fit gets about 30 mpg in the city - meaning I get 30%+ better fuel economy. With the higher cost of fuel, we probably pay around the same amount in a given time frame, however, I am using LESS fuel...and isn't that the point?
Secondly, a diesel vehicle costs a few grand more than its gas equivalent. Diesels are known to last longer though. My Jetta is running strong at 160K miles and it's hard to find a gas-burner Jetta that can say the same. And, correct me if I'm wrong, but hybrids need their batteries around the 7 year mark at the price point of $5K. So yes, the initial buy in for diesels is more, but the lifetime cost per mile will be significantly less than hybrids. The cost per mile for hybrids, over it's lifetime, is still more than regular gas vehicles.
The price of diesel fluctuates at a different rate than regular gas. I've had fill-ups where the cost of diesel was less than gas, although most of the time it was slightly more. Right now it is significantly more, but I know that can change in time.
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pacman 9:55AM (4/15/2008)
Dont fool yourself - its about $$ and not saving gas. I bet my left arm that if Gas would magically go back down to $1.50 a gallon. SUV sales woudl surge, the Prius would have sales slide, and the Diesel woudl be a niche vehicle that few care about. But as long as fuel is crazy expensive people will consider fuel saving options.
Gregg 9:51AM (4/15/2008)
Those are all valid points, but I think the current cost of diesel fuel, combined with the higher cost for the car will discourage most consumers. I know your arguments make sense as I have a diesel Golf and also get 40+ in city/highway driving. But diesels command such a premium on the used market now, because of their scarcity. As manufacturers build more and the diesel people who want them get them, the resale values will no longer be as high. And as more people buy them, diesel fuel will cost more, unless the government adjusts the taxing structure and oil companies put some of their fat profits into refineries...and people stop saying not in my backyard. Too many ifs for diesels to go to 20% here.
Pat 9:56AM (4/15/2008)
pacman - fair enough. I forgot I was posting on Autoblog and not AutoblogGreen (although personally, my issue with using less gas is to reduce dependence on foreign oil). I still contend, in the long term, a diesel vehicle costs less than a gas vehicle. But people seem to freak out over the initial cost and fuel price and don't consider things like fuel cost per mile (only fuel cost per gallon), long term reliability, and resale value.
dejal 9:57AM (4/15/2008)
I haven't seen the price of desiel lower than gas for a couple of years. Factor in that diesel and home heating oil are essentially the same thing and compete for the same barrel of oil, I don't see diesel coming down.