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Will New Diesels Be Too Expensive To Make Much Difference?

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2012 Volkswagen Passat TDI Six-Month Road Test

2012 Volkswagen Passat TDI Six-Month Road Test

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2013 is an exciting time for diesel fans, with three particularly significant models all arriving this year.

The Chevrolet Cruze Diesel, Mazda Mazda6 Sky-D and Jeep Grand Cherokee Ecodiesel will all be on the radar of customers looking to mix performance with economy, and all will aim to replicate the success Volkswagen has had with its own diesel models.

But will pricing be the final sticking point for this new generation of diesels?

Our sister site The Car Connection suspects it might, with recent research suggesting price is still the biggest barrier when it comes to selling cars--no matter how many miles you're getting to every gallon.

Strong sales...

Diesel sales surged by 25 percent in 2012, and when you look at the vehicles on offer it isn't hard to see why.

Most offer considerably better economy than their gasoline counterparts, yet they're more refined than most people realise and performance is invariably strong too. Turbocharged diesels offer a large hit of torque from relatively low revs, meaning you can extract much of their potential with very little effort.

This low-down performance also helps with fuel efficiency at highway speeds, negating the need for frequent gearchanges and allowing the car to sit at low revs while doing higher speeds.

It isn't unusual for drivers of diesels to exceed the official EPA fuel figures for this very reason--something prevalent in Volkswagen's increasingly large diesel range.

...but pricing is important

Alexander Edwards from research firm Strategic Vision believes pricing is still a dominant factor in purchase decisions--along with other factors like styling.

That means diesels have to prove they can offer more than just good gas mileage and an eco-friendly image.

“Effectively, everyone out there is preaching MPG and environmental friendliness, and putting it in their ads and trying to sell it, and the truth of it is nothing is happening because the customer still has one barrier they’re not willing to get over, which is the cost of doing business for an alternate powertrain vehicle,” explains Edwards.

“Is it going to have a real impact in their purchase decision? For five or ten percent of them, it absolutely will. For the rest, it will, but it will be in a melting pot of issues that are often significantly more important.”

So far, Volkswagen has judged the pricing just right--typically, around $1,500 more than the equivalent gasoline version. Customers are happy to pay for the extra MPG and performance benefits.

2014 Mazda Mazda6

2014 Mazda Mazda6

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Cruze diesel too expensive?

Whether others can replicate this success is a different matter.

The Chevy Cruze diesel, at $25,695, is several thousand dollars more than gasoline Cruzes (and more expensive than the Jetta TDI). Edwards suspects this may hinder sales, particularly given its positioning above the strong-selling Jetta.

Mazda is currently an unknown--pricing hasn't yet been revealed, but Mazda is expected to position it as a sportier model than its gasoline counterparts. Meanwhile, Jeep's Grand Cherokee Ecodiesel will be around $2,300 more than V-8 models on upper trims--potentially enough to appeal on improved economy alone.

While Volkswagen has cultivated an image around its TDI badge, other carmakers are yet to develop that loyalty for diesel, and may not see instant success.

Factor in the occasionally extortionate price of filling up Diesel Emission Fluid, or 'AdBlue', and customers will have to make sure the payback will really be as high as the MPG figures make it look.

As with hybrids and electric cars though, it may be as simple as getting bums on seats for people to warm to the idea of a sporty, refined diesel. Make people want the product, and the price will become less of an issue.

For a more in-depth look at the diesel conundrum, head over to our sister site, The Car Connection.

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Comments (14)
  1. The car costs more but so does the fuel, I was staring at the fuel prices while filling up the other day and thought "why bother with diesel ?". I said this because a gallon of diesel was the same price as premium unleaded, sure you'll get more miles but you have to pay the highest prices at the pump. Going electric is still better, you pay a bit more for the car but the cost to "fuel" it, and maintaining it is far cheaper then anything else.
     
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  2. I like to see more clean diesels coming to the U.S. market--finally. But the problems I see for them would be:
    1. The manufacturers typically offer the diesels in a higher trim level only. Look no further than the Jeep GC. Offer the diesel in lower trim levels and it would get some more sales.
    2. Gas engines have nearly caught up to diesels in efficiency. Hybrids are suffering a similar problem in this area. Take the Cruze Eco vs. Cruze diesel for example. 40 mpg vs. 45 mpg. Not much efficiency difference but quite a bit of price difference.
    3. Diesel fuel itself is more expensive.

    It's a tough one. Diesels offer a lot of virtues and value. But their climb will be uphill IMHO.
     
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  3. In the real world the difference is much greater as the EPA ratings for diesels pessimistic and the gas ratings are optimistic.
     
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  4. Personally I want the high trim level with all the luxuries thereof, but I do not want an automatic transmission to go along with it.
     
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  5. Manufacturers probably sense a lot of pent up demand so will price products high for the early adopters, it will be a shame if their short term pricing strategy ruins the prospects for Diesel in the US.

    Prices and specs will fall over time. And Diesel at the pump will also fall in price as volumes increase.
     
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  6. Folks have no problem paying more money for more powerful, less efficient, higher-trimline, Premium-Fuel-demanding engines in their Camcords and CUVs - So I don't think people aren't willing to spend more money on a more powerful, more efficient engine. VW and Audi sell all the TDI's they can import - folks in some areas actually have to wait months in order to get one.
     
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  7. The improved gas mileage is offset by diesel costing more. So NO reason to buy diesel.
     
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  8. If you can get 30% better mpg but only pay 10% more for fuel then there is a payback for going diesel.
     
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  9. I own a 2003 Ford F350 diesel & use it only when necessary. It has a real time fuel consumption gauge. Take off from a stop is about 3 or 4 mpg BUT when I get rolling it does much better. I took 5 friends & luggage from Anaheim, Ca to Los Vegas, NV and averaged 25.6 mpg. When I haul people skis & snowboards or whitewater rafts up to the mountains it's much less but I'm still money ahead of owning a gasolene powered truck. We're selling out Camrey & getting an electric Focus.
     
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  10. 25+ mpg is very impressive indeed from a vehicle like that, congrats.
     
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  11. Diesels do not cost more to make. It is a lie.
     
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  12. @Annatar: Please provide sources for your statement that diesels cost no more to make than gasoline engines of equivalent output.

    I have spoken to diesel program execs and product heads at roughly half a dozen automakers. ALL of them acknowledge that a diesel engine with modern aftertreatment (urea injection and the various catalytic converters and DPFs) costs 15 to 20 percent more than a gasoline engine of equivalent output.

    So please provide your sources for the absolutist statement that what they told me is 'a lie'. Thank you.
     
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  13. I think it should be mentioned that the Mazda diesel won't have the urea injection stuff that other diesels have. That is the diesel i want. Hopefully it will be reasonably priced.
     
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  14. The article failed to mention the Dodge Ram 1500 diesel, which should be available in Q3 of this year. This has the potential to be a huge hit with it being the first 1/2 ton pickup to offer a diesel option. Together with the 8 speed tranny this truck could really change the market for pickups.
     
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