Regulating the future

While BMW, Ford, General Motors, and Toyota, among others, offer diesel passenger cars overseas, none are ready to bring a diesel vehicle to the U.S. market, even though they could modify some vehicles to meet current U.S. standards. The concern lies in meeting the future standards and doing so without adding too much cost to the vehicle.

"We believe we can meet the new emissions standards, but it is questionable if it is feasible at a price point that makes it desirable to the customer," said GM spokesperson Nick Richards.

"It's our longer-term goal to make our diesel models available in all 50 states," said Mercedes-Benz spokesperson Rob Moran.

However, new legislation may help reduce that issue. The energy bill that President Bush signed in August 2005 gives buyers of clean diesel vehicles tax credits of up to $3,400--an incentive designed to offset the increased cost of diesel technology in much the same way as the tax credits for hybrid vehicles. Even BMW, which has some of the best-selling diesel cars in Europe, isn't ready to jump in to the U.S. market yet. "If we could offer a 50-state clean diesel-powered car, the likelihood [of bringing it to America] would certainly be greater," BMW product communications manager Dave Buchko said.

Mercedes-Benz is one company that decided to offer diesel vehicles in the United States, even though not being able to sell its vehicles in those 5 states means a significantly smaller market. When it introduced the diesel version of its E-Class sedan in the United States in 2004, the company knew it was essentially reducing its sales potential by 40 percent by being able to sell in only 45 states. Despite the smaller market, Mercedes-Benz has sold nearly one-third more E320 CDI vehicles than its initial annual projections.

The diesel version of the Jeep Liberty is another diesel model that is surpassing expectations. Jeep is predicting sales of 10,000 Liberty CRD models for the 2005 calendar year--double what it originally projected. Another 2,500 vehicles have been added to the production schedule, and the company is not sure if even that will be enough to meet the demand.

Since so many customers seem to be speaking with their wallets, it looks like a sure bet that more diesel passenger vehicles are on the horizon. Jeep is encouraged enough by Liberty sales that it is assessing adapting the power train to other vehicles, while Mercedes-Benz says it's likely it will offer diesel versions of its M-, G-, and R-Class models in the future, although no firm dates have been set. "It's our longer-term goal to make our diesel models available in all 50 states, and if the fuel suppliers are able to get the cleaner fuel, we are confident we can build diesel vehicles that will meet the future emissions standards," said Mercedes-Benz spokesperson Rob Moran.

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