Lutz Says Diesels No CAFE Panacea

Special Coverage

Management Briefing Seminars

TRAVERSE CITY, MI – Expensive emission controls could make diesel engines so expensive in the U.S. they will never enjoy a fraction of the popularity they do in Europe, where they account for about 50% of the market.

General Motors Corp. Vice Chairman Bob Lutz tells attendees at the Management Briefing Seminars here the auto maker currently builds about 2 million diesel engines annually (mostly in Europe) and has a new family of light-duty V-6 mills coming in the U.S., as well as an all-new V-8 diesel.

But he says the oil burners are not a panacea for improving fleet fuel economy.

Lutz says there is a growing impression in Washington, as well as in the media, that auto makers will be able to boost corporate average fuel economy 30% simply by replacing current engines with diesels.

Tough new emissions requirements, and the expensive emission controls they require, will make that fantasy impossible, he insists. Stricter Euro 4 emissions rules in Europe already are hurting diesel sales there.

“And they haven’t even seen Euro 5 yet,” Lutz says.

Coming U.S. Tier II Bin 5 standards are about six times tougher than Euro 5, he adds, warning the technology necessary to make diesels comply with such strict requirements is so expensive and complicated it will scare away consumers.

“Flip (a diesel car over with a full urea-injection exhaust aftertreatment system) and the underside looks like an old-fashioned Kentucky (moonshine) still,” he says.

“(An extra) $1,500 doesn’t come close to covering the cost of emission controls that will deal with Tier II Bin 5 (standards).”

The premium price for a diesel powerplant (vs. conventional gasoline) could be more than $5,000 for fuel economy that no longer will be 30% better.

That’s because some fuel is used in the exhaust aftertreatment process (to burn off soot in the particulate filter), making the engine far less appealing to cost-conscious consumers.

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