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Survey: US New-Car Shoppers Do Not See Diesels as a Likely Mainstream Powertrain

28 January 2008

According to the latest Kelley Blue Book Marketing Research study, only six percent of new-car shoppers in the US think that diesel is most likely to succeed in becoming a mainstream vehicle powertrain type, compared to 40% identifying hybrids, 20% selecting hydrogen fuel cell vehicles and 17% citing flexible-fuel systems.

When asked about their perceptions of diesel engines, nearly half of the in-market new-vehicle shoppers say that diesels are dirty and noisy. In addition, the latest study shows that shoppers increasingly believe that diesel-powered vehicles get poorer fuel mileage than conventional gasoline engines, and fewer consumers are seeing diesels as fuel-efficient.

Interest in diesels is steadily declining among in-market new-vehicle shoppers, while interest in hybrids continues to grow. The gap between shoppers’ interest in diesels versus hybrids has greatly widened particularly in the last month, with the nine-point gap in December 2007 jumping to a 17-point gap in January 2008.

Many automakers are looking toward diesels as a very workable solution for the future, especially in light of the recently passed energy bill, but the results of this study should give them pause and make them realize they need to do a better, more thorough job of winning over the American consumer. Clearly many Americans still think of the dirty diesels of the past and are not aware of the benefits of new clean-diesel technology.

—Jack R. Nerad, executive editorial director and executive market analyst for Kelley Blue Book

While diesel consideration and favorability are declining in the eyes of in-market new-vehicle shoppers, hybrids continue to gain favor. In addition to hybrids being seen as the most viable mainstream powertrain choice, interest in hybrids has steadily increased in recent months, with 61% of shoppers saying they are interested in hybrids in the latest study.

When asked about the premium they are willing to pay for a gas/electric hybrid over a traditional gasoline-powered version of the same vehicle, this month shoppers are willing to pay an average premium of $3,135, up from an average premium of $2,645 a month ago in December 2007.

When asked about which hybrid vehicles they would consider for their next purchase or lease in the latest study, in-market new-vehicle shoppers cite the Honda Civic as most popular with 35%. The next most-popular models are the Ford Escape and Toyota Highlander, each garnering 23%. Toward the bottom of the consideration list is the vehicle that arguably put hybrids on the mainstream map—the Toyota Prius—which only garnered 12% of the consideration.

Prius sales accounted for more than 52% of hybrids sold in the US in 2007.

The latest Kelley Blue Book Marketing Research study was conducted on Kelley Blue Book’s kbb.com among in-market new-vehicle shoppers during January 2008. Kbb.com is rated the No. 1 automotive information site by Nielsen//NetRatings and is ranked as the most visited auto site by J.D. Power and Associates eight years in a row. Nearly one in every three American car buyers performs their research on kbb.com.

January 28, 2008 in Diesel, Market Background | Permalink | Comments (115) | TrackBack (1)

Comments

The only vehicle I know of where there isn't a premium for diesel is the dodge ram 2500, that was for 06' may have changed now that they had to add the bluetech. i get 23mpg with no mods 20-50% biodiesel blends on the freeway. if it was a diesel parallel hybride then i would be up around 50mpg in a stupid 8000lb vehicle. my opinion is that this is all laziness on the side of the us auto industry; marketing laziness and technology integration laziness.

Posted by: phronesis | January 28, 2008 at 09:02 AM

if it was a diesel parallel hybride then i would be up around 50mpg

Based on what?

Posted by: Anne | January 28, 2008 at 09:06 AM

The average American is just that the average American which sadly is a blundering idiot with a low IQ and even lower common sence. Stay off Diesel soccor mom americans its better spent fueling my 4x4. I get 23 mpg Diesel in a truck thats 2 times as big as some of the SUV driving soccor slugs getting 20 or less. 8500lbs at 23mpg brought to you only by Diesel. Thank you Rudolf

Posted by: CumminsMan | January 28, 2008 at 09:10 AM

its interesting to read all of the comments mentioning the narrow minded and short sighted thoughts about americans and i can't say i disagree. clearly as a country some important changes need to occur and we may or may not be running out of time to make those changes. optimistically i hope for a major shift in social responsibility for the country. pessimistically i think money and big business/government might get in the way of the informed and conscientious consumer getting what they want.

Posted by: phronesis | January 28, 2008 at 09:11 AM


Joe

Not exceptional at all. I live in the southwest, the numbers on that report are average numbers. Last week the 'corner store' 1 mile from my house was selling Dino for $3.24, the truck stop 5 miles away was $2.97.

Also, I pay $.08 per gallon less than the advertised price because I am a Light Duty Diesel and do not have to pay the extra tax.

The more you know!

Posted by: Joseph | January 28, 2008 at 09:11 AM

Anne

based on the fact its more efficient, don't be ridiculous. do you want me to go find every article that supports this cause i didn't really think it was necessary for the type of audience here

Posted by: phronesis | January 28, 2008 at 09:13 AM

I'm kind of open to all those future technologies, but have to choose what is available to me in the California market. In 2005 that was the Prius, with stickers for the car-pool lane, a pretty good deal.

So sure auto-makers, beat that, and show me the independent rankings for maintenance repairs and TCO (total cost of ownership) ... maybe you can build my next car.

Posted by: odograph | January 28, 2008 at 09:15 AM

i didn't really think it was necessary for the type of audience here

You're drawing the wrong conclusion. That's exactly what the audience here does want.

I suspect you're just throwing in a number, and don't have a clue what you're talking about. Hybridization can improve your real-world fuel economy by 30%, not the 117% you're suggesting.

Posted by: Anne | January 28, 2008 at 09:18 AM

diesel price in seattle is about 3.59 and bio-diesel here is over $4, i paid $4.29 the other day. most bio that comes here is from the midwest, all our local bio refiners sell to europe because its all non gmo canola

Posted by: phronesis | January 28, 2008 at 09:20 AM

Joseph

Even in yr case I still think the basic premise holds true, i.e. diesel is more expensive than gasoline. For example, I checked the prices of Phoenix, AZ on the web and the difference between normal grade and diesel is generally 20c and upward.

Posted by: Joe | January 28, 2008 at 09:26 AM

Diesels are more polluting. The small sized particulate particles that escape from the particulate filter turn out to be the most damaging to the lungs.

Posted by: Lulu | January 28, 2008 at 09:43 AM

anne,

considering my diesel is running at about 50% its capacity to start with, if you optimize the engine and add the electric motor with an increase of 30-50% it would not be at all unreasonable to achieve the 50mpg. the manufacturer could always build the engine out of something a little lighter than iron.

my apologies I guess I was assuming more improvements beyond just the addition of the electric motor, nonetheless it would be possible to achieve this efficiency in a full size truck and not just in a one off capacity

Posted by: phronesis | January 28, 2008 at 09:52 AM

Joe, try this site: http://www.phoenixgasprices.com

Mid grade range from $2.79 - 3.18. Dino range from $2.97 - $3.41. Depending on where you buy. Currently 1/2 mile from my work; Mid grade $3.09, Dino $3.06.

Posted by: Joseph | January 28, 2008 at 10:08 AM

lulu

the ability to control diesel emissions increases as the sulfur is removed from the fuel. the need to remove sulfur from fuel is akin to the removal of lead from gasoline

Posted by: phronesis | January 28, 2008 at 10:10 AM

Then why are the gas companies not doing this then !
Oh yeah , I forgot, its that cost thing again , you when
cost out-weighs the public good !

Posted by: | January 28, 2008 at 10:32 AM

the companies and our ever failing EPA, its not like its new technology they just came up with to remove sulfur

Posted by: phronesis | January 28, 2008 at 10:52 AM

I owned a diesel Jeep Liberty CRD for two years. It was a 2005 model with nearly-current technology and it was noisy and polluting. Not nearly as bad as diesels from 10 or more years before, but much noisier and more polluting than any gas engine vehicle from 2005. I could tell that I was breathing diesel fumes regularly as the driver of it.

Now pile on that in my area diesel costs $0.50 more/gallon than regular gasoline, and all reports I hear are that 2007+ diesels meeting the new emissions requirements have little or no fuel efficiency benefit over gasoline in the real world (based on numerous owners of diesel and/or gasoline heavy duty pickups, on a different board I use) and I am hard pressed to see diesel making much sense. Sure, the 6% rate is amazing and is probably less than the number of Americans who've been to Europe in the last 10 years, but I don't think it's crazy. From where I stand diesels can either be efficient or clean, but doing both doesn't seem to be something they have yet achieved.

On top of this, gasoline direct injection is making major gains in terms of thermal efficiency, to where it is only slightly behind diesels in efficiency and perhaps ahead when current market prices of fuel and the diesel engine premium are factored in.

Posted by: Zach | January 28, 2008 at 10:55 AM

i guess i should say that it is now required that sulfur be removed down to 15ppm from the previous of 500ppm. off highway diesel still maintains no regulations on sulfur and marine diesel and then bunker fuel are also ridiculous

Posted by: phronesis | January 28, 2008 at 10:58 AM

Zach

I haven't looked at the efficiency of the new diesels (08' and newer t2bin5) but the older diesels can be just as clean and maintain efficiency by blending biodiesel in at 20%.

Obviously we have other obstacles to overcome with ag based biodiesel reaching 20% of the 65 billion gallons of on highway diesel production

Posted by: phronesis | January 28, 2008 at 11:32 AM

All this study shows is how ignorant the surveyed are. Hydrogen... Yeah right!

Most people are incapable of making intelligent discisions regarding car safety (SUV's that flip over and kill other more responsible drivers) and environmental responsibility.

Posted by: GdB | January 28, 2008 at 11:45 AM

Zach's testimonial above is one of the first I've read about the Liberty CRD. While it was described as a success by DCX (about 10,000 units over 2 years), I'm not sure we'd see another Liberty-class diesel again. It seems the trend for diesels now is mainly in the premium market (large, higher-margin trucks and SUVs, and luxury brands).

Of course, there's the rumored Honda diesel for Ridgeline, which is still not certain. The speculated TSX diesel probably will be Honda's first diesel in US. That model will certainly carry a premium over same class of cars. We'll see if diesel variants will help boaster the Acura brand, which seems to have taken a beating in 2007.

Posted by: Charles S | January 28, 2008 at 11:47 AM

Holy Cow, the TSX is a $30k car... ! 2007 sales was about 33,000 units, down over 13% from 2006. It seems that Acura plans for diesel will only go up in price from there, as future diesels will move upward to the higher priced Acura vehicles.

Posted by: Charles S | January 28, 2008 at 12:00 PM

This goes to show you how ignorant the average American is.

Posted by: gary | January 28, 2008 at 12:01 PM

Phronesis, as a matter of fact the Liberty CRD ran noticeably better and cleaner when I could run B20 (20% biodiesel from soybean oil). The smell was still there but wasn't as bad. But go back and see the article from a year ago that biodiesel may create more of the micro soot that's actually worse for lungs. Also, there are few biodiesel pumps even though I'm in a top soybean farming state, and it made no sense to drive 20+ miles out of the way for B20.

Charles, DCX really hyped the CRD, and even sold slightly more than they expected, but it was basically a failure. The main issue was reliability and driveability - it had SERIOUS problems with both. Gas mileage and power were both good, but who cares if the vehicle spends 3 weeks a year in the shop. All CRDs had numerous recalls and repairs, and many were bought back. I traded mine because I couldn't put up with the problems any more. The issues partially relate to severe compromises to make the euro-spec engine meet US emissions standards (pre-2007!) with LSD. ULSD made things better but not fixed. There are also just plain engineering failures like using a transmission that couldn't survive the diesel engine's torque at low rpm.

I've read lots about the wonderful cheap, economical euro market diesels, but then on further reading it turns out hardly any of them meet tier 2, bin5 emissions standards. I guess if anyone can make a diesel that works and is both clean and efficient, Honda will be the one. But I'll believe it after it's been running in the US market for a year without recalls or failures. I know most people on this site don't follow or like big pickups, but among people who own them, the reports of 2007+ diesels are very discouraging, primarily for mileage/efficiency (most of them are still very powerful, in fact more than is really needed). Chrysler has a Mercedes diesel in the 2007+ Grand Cherokee, but the cost is incredible (over $40k for the vehicle with the diesel) and reports of gas mileage aren't all that terrific - maybe 20mpg or so. Having been a guinea pig once for a diesel that was supposed to be modern, clean, reliable etc. and finding out it wasn't clean or reliable, I'm not eager to be a guinea pig again.

Posted by: Zach | January 28, 2008 at 12:34 PM

Zach, thanks for the info on both Liberty CRD and 2007 Jeep Grand Cherokee Diesel. You're right, I, for one, don't normally follow the long-term reports on such vehicles.

I know that common myth among hybrid vs. diesel debate is that diesels are worth the premium because it will last longer. In general, I think every type of vehicles have their own success/failure stories. I think it is too optimistic to believe that just because a car has a diesel engine, it is automatically assumed it's reliable.

Of course, this comes back to Honda's branding image; assume by many, including happy owner such as myself, as a brand for reliability. I think the TSX diesel has an uphill battle against the competitions in the same class. If it manage to be successful, it will certainly do a lot on public perception of diesels.

Posted by: Charles S | January 28, 2008 at 01:16 PM

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