Annual Growth of Diesel Light-Vehicle Demand

WESTLAKE VILLAGE, Calif., Jan. 16, 2008 -- Annual growth of diesel light-vehicle demand in Eastern Europe, Asia and North America combined is projected to surpass growth in Western Europe by the early part of the next decade, according to the J.D. Power and Associates Automotive Forecasting Global Diesel Light-Vehicle Forecast(SM).

"In the short term, it will continue to be Europe -- primarily Western Europe -- that will provide almost one-half of the growth in demand for diesel light vehicles globally," said Al Bedwell, senior manager at J.D. Power Automotive Forecasting. "While this remains a very significant portion, it is worth bearing in mind that average growth in Europe during the past four years was 62 percent. We are now entering a period when Europe will become less critical as a driver of growth in global diesel light-vehicle demand. In terms of absolute demand, however, Europe will still remain the most dominant region throughout the next decade."

According to the report, by 2017, North America and Asia combined will account for 45 percent of global annual demand for diesel light vehicles, compared with just 25 percent in 2007. Increasingly, diesel is seen as part of the solution to issues of vehicular CO2 emissions and air quality and is no longer associated with poor performance. As a result of these factors, significant growth in most of the major light-vehicle markets can be expected in the next decade.

With the exception of Brazil, all of the world's significant personal vehicle markets are now technically open to diesel vehicles, although some markets impose emission limits and/or fiscal and regulatory frameworks that make the sale of diesel vehicles economically unviable. The increasing tendency to connect vehicle taxation to fuel efficiency and CO2 performance is also seen as a driver of diesel vehicle demand.

Global demand for light vehicles is expected to grow from 66 million units in 2007 to 92 million by 2017. Demand for diesel-powered light-vehicles is projected to increase from 16 million to 29 million during the same period, resulting in an increase in market share from 23.6 percent in 2007 to 31.5 percent by 2017.

  Regional Highlights

  Western Europe
  -- Overall growth in diesel vehicle demand in Western Europe has passed
     its peak. Annual increases in regional diesel share will be modest
     between 2008 and 2010, with slight declines likely in the years that
     follow.

  Central and Eastern Europe
  -- Penetration of diesel-powered vehicles among new-vehicle sales in the
     Central and Eastern European regions in 2007 remained mixed, varying
     from less than 10 percent in Russia (although diesel demand in the
     Russian urban market is beginning to stir) to 50 percent in Turkey.
  -- Excluding Russia and Ukraine, the region has experienced considerable
     growth in diesel vehicle demand in recent years, increasing from 19
     percent in 2002 to 42 percent in 2007.

  North America
  -- In response to strict tailpipe emissions limits, high fuel prices and a
     growing awareness of greenhouse gas issues among both consumers and
     policy makers, rising demand for both diesel cars and light trucks is
     forecast for the North America market.
  -- Many manufacturers now have firm plans to enter the U.S. diesel market,
     which is projected to lead to a significant rise in diesel
     light-vehicle penetration, from 3 percent in 2007 to 14 percent by
     2017.

  South America
  -- Brazil's increasing commitment to ethanol as a fuel type for passenger
     vehicles will limit diesel prospects in South America's largest vehicle
     market. Nevertheless, diesel light-vehicle penetration rates are
     climbing in other markets in the region, particularly those strongly
     influenced by European auto makers.

  Asia
  -- Asia's largest light-vehicle markets, China and Japan, have very low
     current levels of diesel vehicle sales. The advent of clean diesel may
     lead to a rise in demand in Japan. China includes diesel on its list of
     carbon-reducing technologies for personal transport and already has a
     large diesel light-vehicle market.
  -- Diesel penetration rates in the total Asian light-vehicle market are
     predicted to increase by 10 percent by 2017.

  About J.D. Power and Associates

Headquartered in Westlake Village, Calif., J.D. Power and Associates is an ISO 9001-registered global marketing information services firm operating in key business sectors including market research, forecasting, performance improvement, training and customer satisfaction. The firm's quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

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Founded in 1888, The McGraw-Hill Companies is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands such as Standard & Poor's, McGraw-Hill Education, BusinessWeek and J.D. Power and Associates. The Corporation has more than 280 offices in 40 countries. Sales in 2006 were $6.3 billion. Additional information is available at http://www.mcgraw-hill.com/.