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Business News of Friday, 8 February 2013

Source: BBC

Why do Americans not drive diesels?

A 1.6-litre turbodiesel delivers the torque surge of a much larger gasoline engine, yet with the fuel efficiency of a much smaller one. In the UK, diesel sales account for more than half of all cars sold, and even with a stat like that, Britain lags the rest of Europe, which has long preferred diesel to gas.

So why would more Americans not drive diesels? From the European perspective, it would suit the driving style of the States perfectly, with lots of relaxed muscle available at low rpms to cruise vast interstate networks that are the envy of the world. Better mileage means fewer fill-ups, and the on-paper improvements in fuel economy would, overnight, take the US fleet one massive step toward President Obama’s targeted 54.5 mpg national average by 2025. Simply stated, diesel should “work” in the US.

“But what do Britons know about our market?” an American might opine. Quite a lot. In significant ways, the diesel market in the US is similar to that of the UK three decades ago.

In the UK of the 1980s, diesel drivers were outcasts. They were required to fill up around the back of the station, over by the truckers, to be looked upon by gasoline burners with a mixture of pity and smugness. And that presumed diesel drivers could even find somewhere to fill up, as not every filling station bothered to stock their fuel.

This sheer lack of availability led to great variability in pricing. As the only filling-station proprietor in 25 miles to stock diesel, Mr. Smith could subsequently charge more or less whatever he wanted. A survey of diesel prices in the US illustrates a similarly maddening snapshot of how scarcity can produce wide price fluctuations, with pump prices varying by up to 50 cents a gallon. But with more diesel purchasers, the laws of the marketplace would kick in, bringing prices into greater alignment.

Given the need for low-sulfur refining, diesel would not necessarily become cheaper than premium in the US. It is pricier on the other side of the Pond, too, but although Europeans gripe about it, they still know the savings add up. Diesel generally returns 30% better mileage than gas, and in the dominion of $8 gallons, this is no small advantage.

Mind you, there are two distinct factors working in favour of Europeans’ wallets: fuel with a higher cetane rating, which makes it easier to control NOx emissions, and EU emissions standards that are generally comparable to the US’s Tier 2 standards in all areas apart from, yes, NOx. Even our EU 6 standards, due in 2015, do not quite match the States’ strict limits on smog- and acid rain-causing emissions.

Relative to a gasoline-burning engine, it is more difficult to control NOx in a diesel, which is why, to meet those comparatively stricter emissions limits, diesels in the US are required to use expensive, onboard after-treatment systems, which decrease the amount of particulate matter that leaves the tailpipe. Diesel engines are already more expensive to develop than gasoline units, given their turbos and complex injection systems. After-treatment systems make them even pricier.

Here’s the thing: It’s worth it. Diesel used to be a dirty fuel and a dirty word, but recent technologies have addressed both problems, which is why the world outside the United States thinks of the choice between gasoline and diesel as a foregone conclusion. And even with the additional costs, passed on to the consumer, of emissions compliance equipment, the sensory pleasures of a diesel-powered vehicle are difficult to deny.

It is high time, America, to give diesels a better look.