Diesel Penetration In North American Light Vehicles Will Remain Low, Warns ABI Research

Oyster Bay, NY - January 20, 2004

The proliferation of diesel-powered light vehicles continue to grow in Europe, where buyers are mostly attracted to the higher fuel efficiency of diesel engines over gasoline counterparts. In stark contrast to the over 40% penetration rate of diesels in European light vehicles, diesel engines aren't offered in North American light vehicles outside of large pickups, SUVs and a handful of Volkswagen models. Despite two DaimlerChrysler model introductions and the need for automakers to increase their average fuel economy, the market penetration of diesel powered light vehicles will remain extremely small in North America into the next decade, finds technology research firm ABI.

"American buyers won't be able to utilize most breakthrough diesel engine technologies developed by automakers in Europe," explains ABI analyst Dan Benjamin. "Upcoming US Tier 2 emissions standards are much stricter on diesels than Europe's EURO 4 standard. They will require US-targeted diesel vehicles to use diesel particulate filter (DPF) technology. Most DPFs don't function properly in the presence of sulfur, and US fuel won't be sulfur-free until 2006." The cost of the DPF plus the diesel engine will be upwards of a thousand dollars over a comparable gasoline vehicle.

Aside from sulfur content, American diesel fuel has a much lower cetane (a measure of the fuel's resistance to predetonation) count than European diesel fuel. This means American consumers will receive diesel engines that are detuned to account for low-quality fuel. These engines will deliver poor power and less fuel-efficiency than European counterparts.

Although regulations are in place to reduce sulfur levels, no regulations exist to increase cetane in the US.

According to the findings of ABI's new study, while Western European diesel sales will continue to grow, North American sales of diesel-powered light vehicles will be limited until the end of the decade, as automakers wait for cleaner fuel and gauge consumer perceptions of diesels.

The new report, "Engine Management Systems: Emerging Markets for Advanced Exhaust, Fuel, and Intake Technologies," examines engine technologies for gasoline and diesel-powered light vehicles, including variable valve timing, direct injection, cylinder deactivation and emissions systems, with regional forecasts through 2010.

ABI is a N.Y.-based technology market research firm founded in 1990. ABI publishes market research and technology intelligence on the wireless, automotive, electronics, broadband and energy industries. Details can be found on the web at abiresearch.com or by calling 516-624-3113.