Hybrid Versus Diesel

The debate between the supporters of hybrids and those of clean diesel is becoming more intense. The CEO of the largest producer of diesel light vehicles in the world (VW) not surprisingly say that diesel-powered vehicles are better than hybrids. Executives at the world leader in hybrid technology (Toyota) similarly claim that their technology is the path to the future. We expect interested parties to be, well, partisan, so the claims and counter-claims of the makers of diesel and the makers of hybrids are hard to accept at face value. But it makes it hard for a reasonably intelligent person wanting to understand the pros and cons of hybrids and clean diesel to get unbiased information.

Both hybrid and diesel light vehicle are beginning to build a presence in America, but both face obstacles on their way to mass adoption.


Higher Price Tags

Hybrids and diesel both add significantly to the purchase price of the vehicle. Economics may, in fact, be the biggest obstacle to mass acceptance for both technologies. As long as production volumes are low, costs remain high, but high sales volumes are unlikely until costs are low.

Added Retail Price for Hybrid Systems
Hybrid System
Small Cars
Midsize &
Large Cars
Small Trucks
Large Trucks
Stop/Start $600 $640 $640
ISAD $1,250 $1,385 $1,450 $1,625
IMA $1,620 $1,790
Full Hybrid $3,320 $3,920 $3,700 $4,100
Source: "Source: “Future Potential of Hybrid and Diesel Powertrains in the US Light-Duty Vehicle Market,” by David L. Greene, K.G. Duleep, and Walter McManus, Report to Department of Energy, July 2004.

The table above gives estimates of the substantial added retail price the buyer faces for various hybrid systems. People often use “hybrid” as if it describes a single type of system. In fact, there are at least four different types of hybrid systems.

The Stop/Start hybrid system shuts the engine off when it would otherwise idle and restarts it instantly on demand. The Integrated Starter Alternator with Damping (ISAD) hybrid system allows the electric motors to help move the vehicle in addition to providing stop/start capability. The Integrated Motor Assist (IMA) hybrid system is similar to the ISAD but has a larger electric motor and more electricity can be used to help move the vehicle. The Full Hybrid system permits limited all-electric drive in addition to supplementing the power of the gasoline engine.

Diesel engines are already more costly to manufacture than comparable gasoline engines because they need higher-pressure fuel injection systems. Meeting future pollution limits that make diesel as clean as gasoline will require additional, costlier pollution-control systems. The table below shows estimates of the added retail price for diesel on different size vehicles, both now and when the higher pollution limits are imposed. Note that the additional, costlier pollution-control systems will bring diesel engines only to parity in pollution with the average gasoline engine. The emissions the systems will reduce include smog-causing nitrogen-oxides and particulate matter.

Added Retail Price for Diesel Engines
Small Vehicle
Midsize Vehicle
Large Vehicle
2005
$1,750
$2,300
$2,500
2008
$2,280
$2,925
$3,200
Source: "Source: “Future Potential of Hybrid and Diesel Powertrains in the US Light-Duty Vehicle Market,” by David L. Greene, K.G. Duleep, and Walter McManus, Report to Department of Energy, July 2004.


Diesel Advantages

Compared to gasoline engines of the same size, diesel engines today get 35% better fuel economy and produce 25% more power (torque). In meeting future tighter pollution limits, diesel engines will have their fuel
economy advantage fall to between 30% and 33%.

Diesel Barriers: Tougher Restrictions, Fuel Availability, and Image Problem
Makers of diesel engines have yet to demonstrate the ability to meet nitrogen-oxides pollution restrictions for the required 150,000 miles. They are confident that the restrictions on particulate matter can be met with added exhaust filters, but the nitrogen-oxides restrictions are more challenging. Meeting both sets of restrictions would make diesel as clean as gasoline, and would satisfy Federal regulations, but may not be enough for California and the Northeastern states that follow California’s stricter requirements. Engineers are working diligently to develop the components needed.

As an indication of how significant the pollution problem still is for current diesel engines consider that the diesel Jetta is rated 4 on the EPA’s Air Pollution Scale (1 to 10 with 10 lowest pollution) whereas the gasoline Jetta is rated 8. On the same scale, Prius earns a 10 and Escape Hybrid earns an 8. The stricter pollution standards for diesel engines do not fully take effect until 2007, so, if one is very concerned about not contributing to pollution, then one should wait until then to consider diesel.

Availability of diesel fuel is a concern for many drivers. Only about 33% of neighborhood service stations carry diesel, and often the diesel pump is dirty since spilled diesel does not evaporate like gasoline does.

Diesel suffers from an image problem. Owners of gasoline vehicles generally still believe that diesels are noisy, smelly and underpowered relative to gasoline vehicles. In large part, this is due to unfamiliarity with modern diesel technology. Compared with 1988 diesel technology, modern diesels have 100% more power, 60% less noise, 90% lower emissions, and 30% less fuel consumption. Modern diesels are not noisier than gasoline engines, do not produce a diesel odor, and accelerate as well as comparable gasoline vehicles. This suggests that many of the negative perceptions about diesels held by car buyers could be overcome with greater exposure to modern diesel vehicles.

In surveys by J.D. Power and Associates, owners of diesel vehicle expressed strongly positive perceptions of diesel vehicles. Diesel owners perceive their vehicles to be much more reliable, powerful, and fuel efficient than gasoline vehicles.


Hybrid Advantages

The combination of a conventional gasoline engine and an electric motor permits exceptional launch and acceleration. As is true for diesel, it is likely that manufacturers will offer consumers both increased fuel economy and increased power in future hybrid designs. In measuring advantages of hybrids analysts focus on the change in power and fuel economy achieved compared to a comparable non-hybrid engine. In other words, how much more powerful and fuel-economical is the Civic Hybrid than the non-hybrid Civic? For most consumers this is not the real-world comparison: they aren’t necessarily choosing between comparable hybrid and non-hybrid cars, but between a hybrid and a gas-guzzler. The comparisons derived by the analysts are the minimum gains these consumers would experience.

The table below shows the increase in power and fuel economy we can expect from the various hybrid systems compared to equivalent gasoline engines.

Improved Power and Fuel Economy of Hybrid Systems
Hybrid System
Change in Power
Change in MPG
Stop/Start
0%
7.5%
ISAD
10%
12.5%
IMA
15%
20%
Full (cars/trucks)
20%/15%
40%/35%
Source: "Source: “Future Potential of Hybrid and Diesel Powertrains in the US Light-Duty Vehicle Market,” by David L. Greene, K.G. Duleep, and Walter McManus, Report to Department of Energy, July 2004.


Hybrid Barriers: Performance and Image

The producers of the hybrids that have so far been sold in the U.S. have tended to compromise power and performance in their pursuit of high fuel economy and low pollution. Most American new-vehicle buyers care more about power and performance than fuel economy and pollution, so to become mainstream hybrids need to offer more. The Ford Escape Hybrid, the mild pickup hybrids from GM (Chevrolet Silverado and GMC Sierra) the new Accord Hybrid, and the announced SUV hybrids from Toyota (Lexus RX400h and Highlander) all move in the right direction. This is neither to deny that many Americans care about pollution, nor that their numbers are growing. However, to go mainstream hybrids (and diesels) will need to appeal to significant numbers of new-vehicle buyers, the group whose preferences for size, performance, and power are reflected in today’s vehicles.

Hybrids also have an image problem. Consumers think of fuel economy and low pollution when they think of hybrid vehicles, but they do not think of increased performance. Even owners of conventional gasoline vehicles see hybrids as exceptional when it comes to fuel economy and emissions, but when it comes to acceleration and power, most gasoline vehicle owners believe hybrids are inferior to gasoline vehicles. Gasoline vehicle owners also give hybrids low grades for reliability, and they believe they are much worse when it comes to price.

Owners of hybrid vehicles have very different opinions about their vehicles. Not only do they consider them to be entirely superior when it comes to fuel economy and air pollution, but they perceive the hybrid’s performance and power to be just as good as that of a conventional gasoline vehicle and they give hybrids better marks for reliability. Even hybrid owners, however, see hybrids as worse when it comes to price.


Mass Market Potential for Both Technologies

Both diesel owners and hybrid owners hold better opinions of their vehicles’ technology than others do. The fact that those who know these vehicles well are happy with them is important, since it implies that except for price there is really no major market barrier to the success of either hybrids or diesels. Both technologies have mass-market potential.

How big could the hybrid and diesel markets become in the U.S. in five years? Hybrids and diesels could each represent 5% to 10% of new light-vehicle sales in the U.S. by 2010 and 10% to 15% each in 2015. Hybrids will probably achieve higher shares sooner than diesels. Makers of hybrids are already starting to offer the broader mix of hybrid technologies and vehicle capabilities that will be needed to attract more mainstream customers. Makers of diesels still face significant issues in reducing pollution from the engines before they will be permitted in large numbers in most of the U.S., and California and the states that follow California’s lead in pollution restrictions may never permit even the cleanest diesels.