Issue: Aug 2004


Europe Report



The Diesel Boom Continues

by Anthony Lewis

The French jump on the European diesel bandwagon helping to push sales numbers even higher.

Europe’s love affair with the diesel engine shows no sign of cooling. The French are as passionate as ever and demand for diesel cars there is now double that for gasoline vehicles.

Meanwhile, French car makers Renault and PSA Peugeot Citro?n have joined the Volkswagen group and DaimlerChrysler in selling more diesel than gasoline powered vehicles in Western Europe according to the 2004 Ricardo diesel report.







 
A Renault Megane Sport Tourer, like the one above, will soon find its way into the author’s garage.
This might explain why I had to wait four months for my new Renault M?gane Sports Tourer to be delivered — with a 1.9L 120 hp turbo diesel and 6-speed manual gearbox — after initially being told it would be with me in six weeks. It was hardly a hardship since the press office at Renault U.K. lent me a similar model to bridge the gap.

After just 10 days, the car is showing an average speed of 39 mph and fuel consumption of 45.8 mpg (U.K., 38.8 U.S.), so I’m pretty happy, and especially happy to have gone for the higher power version (there is an 80 hp version with a 5-speed gearbox).

And, according to the Ricardo report, the upper limits of specific power output of new diesels are set to increase further over the next few years. “With 60kW/L already in production, we believe that the latest developments in diesel technology will ultimately enable peak ratings of 80-100kW/L,” says Ian Penny, Ricardo director of diesel engines. “This is likely to lead to a rapid growth in the sports diesel market, which is currently in its infancy.”

In the U.S., the reports predicts that while a number of new diesel models have been introduced this year, the introduction of the California LEVII emissions standards will mean that diesel sales will remain flat at least until low sulphur fuel is introduced in 2006. Beyond, further new product introductions are considered likely and, with diesel acceptance growing, particularly in the light truck sector, Ricardo predicts a diesel market penetration in the U.S. of 6 percent by 2010.

In Western Europe, diesel sales have doubled over the last five years to a total of 6.3 million, which represents a share of 44 percent of the total new car market.

Volkswagen Group had a 22 percent share of the Western European diesel market in 2003, followed by PSA at 18 percent, Renault at 13 percent and Ford Group at 11 percent.

You can expect to see that Ford share climb significantly this year — according to JATO’s latest half-year sales figures for Western Europe, Jaguar has increased sales by 36.8 percent year-to-date to 33,160 units following the introduction of its new diesel models. I finally managed to drive Jaguar’s 2.7L V-6 twin-turbo S-Type, and it is easy to understand the excitement surrounding the launch of this car.

The engine is the first “big” diesel to come from the joint Ford and PSA Peugeot-Citro?n diesel program. It is more powerful than Jaguar’s 2.5L V-6 gasoline unit, pushing out 206 hp instead of 201 hp and has more torque than the 4.2L V-8 gasoline unit (320 lb.ft. against 310 lb.ft.). Combine that with fuel economy approaching 40mpg and you can understand why there is such demand for the oil-burning Big Cat.

Sales of luxury diesels hover around 35 percent of the total luxury car market, but that is expected to grow with the arrival of everymore powerful engines. MPVs have the biggest share of diesel sales at more than 80 percent followed by SUVs at just over 60 percent.  Executive class (E1) and upper medium (D1) cars are slightly behind, according to Ricardo.

But back to those JATO figures. It shows the Western European passenger car market performing well in the first half of the year, up 2.9 percent against the same period last year to 7.96 million units. The VW Golf was Europe’s bestselling car for the six-month period (288,564 units), followed by the Peugeot 206 (286,291) and Peugeot 307 (254,844). The Renault Clio was in fourth place at 220,918 and the Renault M?gane a close fifth with 220,490 units sold.

Mini/midi MPVs have confirmed their position as the most successful segment with sales up 32.27 percent YTD to 687,054 units, taking 8.6 percent share of the total market (against 6.7 percent in the first half of 2003.) SUVs were up 15.86 percent YTD, increasing 0.6 points to 5.6 percent share of the market with 445,317 units sold in the first half of the year.

Sports cars are also up, by 25.97 percent YTD (although only up 5.96 percent in June monthon- month) to sell 182,525 units or 2.3 percent of the market.

Superminis remain the best selling cars in Europe taking 30.7 percent of the total market YTD, although this is just slightly down on the same period in 2003 (30.9 percent share). Sales in this segment were up 2.33 percent to 2.45 million units led by the Peugeot 206, Renault Clio and Opel/Vauxhall Corsa. Toyota Yaris sales are up 12.4 percent YTD with a strong performance across the region.
 
Brand successes in the first half of 2004 include Toyota, which had the largest market share increase, up half a point to 5.06 percent YTD compared with last year. The Toyota Avensis — built in the U.K. — continues to impress, with sales up 71 percent YTD following a good performance in its “home” market as well as in Germany, France, Italy and Spain.

This article was provided exclusively to Automotive Industries by Interchange, a U.K.-based automotive business agency and consultancy servicing media and corporate clients. Anthony Lewis is a partner in Interchange and can be contacted via e-mail at interchangenews@aol.com.

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