Should Audi and BMW Be Running Scared Over Diesels?

May 19, 2009
2009 BMW 335d

2009 BMW 335d

Over at our sister site GreenCarReports, we've taken a look at the market for new clean diesels--and concluded that the most likely buyers may be previous diesel owners.

That means the biggest winner among new clean-diesel cars could be the 2010 Volkswagen Golf TDI (as well as its sister model, the 2009 Volkswagen Jetta TDI), because VW diesels are inexpensive and they've already sold hundreds of thousands of them in the US.

There's a flipside, though: Audi and BMW may be facing storms ahead, as they plan to use diesels to help them meet new and aggressive fuel-economy standards. The problem? New-car buyers simply don't associate those brands with diesel engines, no matter how good they may be.

VW and Mercedes-Benz have each sold diesels in the States for 30 years or more. They both have a base of previous owners who don't need to be persuaded. In fact, they complained when diesels were pulled off the market in 2008 as emissions standards tightened.

But BMW's current 335d and X5 diesel models, along with the brand-new 2010 Audi Q7 TDI, all face car buyers who've never even considered a diesel. And it may prove to be a long, hard climb to get them on board.

German makers of fast, high-performance sports luxury sedans routinely fit diesels to their European models, where more than half the new cars sold now come with diesels. That's largely due to substantial tax advantages that allow diesel to sell for much less per liter.

Those makers have planned to raise their fuel economy by fitting versions of those diesels to their US-bound models. That required them to develop complex and expensive after-treatment systems to meet US emissions regulations, which are now the world's strictest.

But in the States, the new clean diesels face several hurdles. First, many US buyers' only awareness of diesel engines is from noisy, smoky heavy-duty engines fitted to semis, garbage trucks, and the like.

Second, unlike Europe, diesel fuel costs more than gasoline per gallon in the US. And when gasoline peaked at $4/gallon last summer, diesel cost almost $5 in some areas--requiring complex calculations to work out whether it paid to drive a diesel.

Finally, research shows that only one-third of US new-car buyers would "consider" a clean diesel. The numbers are higher for other technologies, including hybrids.

We loved the Euro-spec 2007 Audi A6 TDI we tested last fall, with its prodigious torque and phenomenal fuel economy.

But we'll be waiting to see how the new entrants do in convincing buyers to opt for oil-burners. BMW is reportedly selling fewer diesels than it projected, so we're a little worried.

Would you buy a clean diesel from Audi or BMW?

2007 Audi A6 TDI

2007 Audi A6 TDI

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