Bloomberg: Honda Reevaluates Timing for Diesel Autos in U.S.
10-29-2008, 08:34 PM
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Bloomberg: Honda Reevaluates Timing for Diesel Autos in U.S.
http://www.bloomberg.com/apps/news?p...lI&refer=japan
Honda Reevaluates Timing for Diesel Autos in U.S. (Update2)
By Alan Ohnsman
Oct. 29 (Bloomberg) -- Honda Motor Co., the world's largest engine maker, said it's reconsidering its target of starting sales of diesel-powered autos in the U.S. next year.
``We're still evaluating diesel fuel price trends and raw- material costs,'' David Iida, a spokesman for the Tokyo-based company's U.S. unit, said in an interview today. Honda hasn't set a date for selling such vehicles, he said.
President Takeo Fukui said in January at the Detroit auto show that an Acura model using Honda's i-DTEC diesel engine would arrive in the U.S. in 2009. That engine probably will be available first on the Acura TSX sport sedan, a U.S. version of Honda's European Accord, which already offers a diesel model.
Honda has said its engine will be among the cleanest diesels sold in the U.S. and will be able to meet air-pollution rules in California that now limit sales of such models. While diesel offers about 30 percent higher mileage than gasoline, the fuel costs an average of $3.39 a gallon in the U.S., compared with $2.59 for gasoline, according to motorist group AAA.
Japan's Nikkei English News reported earlier that Honda would put off sales of such cars in the U.S. and Japan until at least 2010, citing a company executive who wasn't identified. The delay is the result of difficulties in reducing costs to make the engines, Nikkei said.
Honda's American depositary receipts rose $2.19, or 9.6 percent, to $24.94 at 4:02 p.m. in New York Stock Exchange composite trading. They have declined 25 percent this year.
Honda Reevaluates Timing for Diesel Autos in U.S. (Update2)
By Alan Ohnsman
Oct. 29 (Bloomberg) -- Honda Motor Co., the world's largest engine maker, said it's reconsidering its target of starting sales of diesel-powered autos in the U.S. next year.
``We're still evaluating diesel fuel price trends and raw- material costs,'' David Iida, a spokesman for the Tokyo-based company's U.S. unit, said in an interview today. Honda hasn't set a date for selling such vehicles, he said.
President Takeo Fukui said in January at the Detroit auto show that an Acura model using Honda's i-DTEC diesel engine would arrive in the U.S. in 2009. That engine probably will be available first on the Acura TSX sport sedan, a U.S. version of Honda's European Accord, which already offers a diesel model.
Honda has said its engine will be among the cleanest diesels sold in the U.S. and will be able to meet air-pollution rules in California that now limit sales of such models. While diesel offers about 30 percent higher mileage than gasoline, the fuel costs an average of $3.39 a gallon in the U.S., compared with $2.59 for gasoline, according to motorist group AAA.
Japan's Nikkei English News reported earlier that Honda would put off sales of such cars in the U.S. and Japan until at least 2010, citing a company executive who wasn't identified. The delay is the result of difficulties in reducing costs to make the engines, Nikkei said.
Honda's American depositary receipts rose $2.19, or 9.6 percent, to $24.94 at 4:02 p.m. in New York Stock Exchange composite trading. They have declined 25 percent this year.
10-29-2008, 09:18 PM
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Yes diesel is more expensive than gasoline, but the savings are still significant because of the efficiency. It seems like Honda should diversify their options, especially when so many European makes are bringing clean diesels over RIGHT NOW. I just don't get this move.
10-29-2008, 09:26 PM
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This article sheds more info on the Nikkei info and the prices we're talking about. Things are making more sense now... 5 grand is a huge premium!!!
http://www.reuters.com/article/marke...19579520081029
TOKYO, Oct 30 (Reuters) - Honda Motor Co (7267.T: Quote, Profile, Research, Stock Buzz) will put off the launch of its clean diesel cars in Japan and the United States until 2010 or later due to difficulties keeping prices down, the Nikkei business daily reported on Thursday.
The automaker started selling a clean diesel version of its Accord sedan in Europe in June, and it had planned to introduce such cars in Japanese and U.S. markets next year, the Nikkei said.
But such models are still estimated to cost about 500,000 yen ($5,100) more than gasoline engine cars even after sharp price falls of platinum and other precious metals used as catalysts, the paper said, adding that the firm was developing new technology that uses much less platinum.
The price gap between diesel fuel and gasoline has also narrowed recently, reducing the economic appeal of such diesel models, the paper said. ($1=97.45 Yen) (Reporting by Taiga Uranaka; Editing by Chris Gallagher)
http://www.reuters.com/article/marke...19579520081029
TOKYO, Oct 30 (Reuters) - Honda Motor Co (7267.T: Quote, Profile, Research, Stock Buzz) will put off the launch of its clean diesel cars in Japan and the United States until 2010 or later due to difficulties keeping prices down, the Nikkei business daily reported on Thursday.
The automaker started selling a clean diesel version of its Accord sedan in Europe in June, and it had planned to introduce such cars in Japanese and U.S. markets next year, the Nikkei said.
But such models are still estimated to cost about 500,000 yen ($5,100) more than gasoline engine cars even after sharp price falls of platinum and other precious metals used as catalysts, the paper said, adding that the firm was developing new technology that uses much less platinum.
The price gap between diesel fuel and gasoline has also narrowed recently, reducing the economic appeal of such diesel models, the paper said. ($1=97.45 Yen) (Reporting by Taiga Uranaka; Editing by Chris Gallagher)
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10-30-2008, 10:53 AM
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Note: Reprinted with permission from Ward's Auto World
By Christie Schweinsberg
WardsAuto.com, Oct 30, 2008 10:29 AM
Honda Motor Co. Ltd.’s plan to bring a diesel-equipped Acura TSX to the U.S. next year is dead before arrival.
“The (diesel in the) Acura has been canceled,” a source familiar with the program tells Ward’s.
A report in the Japanese business daily Nikkei News today says Honda will delay launching a diesel engine in the U.S. until 2010 or later.
A rumor, published this week on the “Temple of VTEC,” a Honda enthusiasts’ website, claims the engine did not meet U.S. Environmental Protection Agency’s emissions standards when tested with an automatic transmission.
The diesel-powered TSX equipped with a manual gearbox reportedly passed muster, but Honda rejected the business case to make the vehicle available in the U.S. without an automatic.
American Honda Motor Co. Inc. declines comment.
Honda first announced plans to bring a diesel engine to the U.S. in May 2006. It later was revealed the engine would be the i-DTEC 4-cyl. turbodiesel, already available in the European Honda Accord that is sold in the U.S. as the Acura TSX.
CEO Takeo Fukui, speaking at the 2008 North American International Auto Show in Detroit, said Honda’s first vehicle to feature a diesel engine in the U.S. would be an Acura model. At the show, the auto maker displayed an i-DTEC mill in a glass case at the Acura stand.
While Fukui declined to reveal which model would receive the diesel, sources say it was intended to power the TSX midsize sedan.
Fukui was bullish on his company’s diesel plans, which were to include the Honda brand at the time, saying the business case suggested “an appropriate profit level,” despite the price premium applied to diesel fuel. He also forecast eventual annual U.S. sales of 150,000 units.
Allen Schaeffer, executive director of the non-profit diesel-advocacy group, Diesel Technology Forum, expresses surprise at the notion Honda did not foresee testing problems.
In terms of performance and emissions achievements, we’ve seen data presented at technical conferences that (Honda) could make this system work,” Schaeffer says. “People don’t make those kinds of announcements without expecting to meet emissions standards.”
To meet stringent Tier 2, Bin 5 EPA emissions standards, Honda said it would use a catalytic converter to reduce oxides of nitrogen, instead of introducing urea to the engine exhaust – a strategy employed by most European auto makers.
Recent months have proven difficult for U.S. diesel enthusiasts. The cancellation of the Acura program is the latest in a string of pullbacks.
In September, Chrysler LLC admitted it was postponing plans to market a Jeep Grand Cherokee SUV equipped with a Mercedes Bluetec diesel engine.
Toyota Motor Sales U.S.A. Inc.’s Jim Lentz later said the auto maker was reviewing its strategy to bring a diesel engine to market in its Tundra fullsize pickup truck and Sequoia large SUV.
Both Chrysler and Toyota cite the high cost of diesel fuel as a problem, as well as the added expense of the emissions technology necessary to meet EPA requirements.
Despite diesel fuel prices that topped $5 per gallon in the U.S. during the summer, a top American Honda official was high on diesel’s arrival in Acura’s lineup as recently as July, insisting the math still worked in the auto maker’s favor.
“The (fuel) efficiency (of a diesel engine) is greater than the price differential, so it still makes some sense,” Dan Bonawitz, vice president-corporate planning and logistics, said at the time.
Diesel Technology Forum’s Schaeffer says there is light at the end of the tunnel, citing more diesel-equipped vehicles than ever on their way to the U.S. in the months ahead.
“This year, we’re looking at the BMW 3-Series (and) X5 (and) Audi Q7 coming,” he says of future diesel-equipped models. Volkswagen AG’s success with the Jetta TDI also is proof diesel has a future in the U.S. “There are waiting lists for that vehicle,” he says.
“Diesel fuel prices are moderating in some parts of California,” adds Schaeffer, noting a gallon of diesel costs less there than a gallon of gasoline. “We’re seeing the fuel trends go the right way.”
By Christie Schweinsberg
WardsAuto.com, Oct 30, 2008 10:29 AM
Honda Motor Co. Ltd.’s plan to bring a diesel-equipped Acura TSX to the U.S. next year is dead before arrival.
“The (diesel in the) Acura has been canceled,” a source familiar with the program tells Ward’s.
A report in the Japanese business daily Nikkei News today says Honda will delay launching a diesel engine in the U.S. until 2010 or later.
A rumor, published this week on the “Temple of VTEC,” a Honda enthusiasts’ website, claims the engine did not meet U.S. Environmental Protection Agency’s emissions standards when tested with an automatic transmission.
The diesel-powered TSX equipped with a manual gearbox reportedly passed muster, but Honda rejected the business case to make the vehicle available in the U.S. without an automatic.
American Honda Motor Co. Inc. declines comment.
Honda first announced plans to bring a diesel engine to the U.S. in May 2006. It later was revealed the engine would be the i-DTEC 4-cyl. turbodiesel, already available in the European Honda Accord that is sold in the U.S. as the Acura TSX.
CEO Takeo Fukui, speaking at the 2008 North American International Auto Show in Detroit, said Honda’s first vehicle to feature a diesel engine in the U.S. would be an Acura model. At the show, the auto maker displayed an i-DTEC mill in a glass case at the Acura stand.
While Fukui declined to reveal which model would receive the diesel, sources say it was intended to power the TSX midsize sedan.
Fukui was bullish on his company’s diesel plans, which were to include the Honda brand at the time, saying the business case suggested “an appropriate profit level,” despite the price premium applied to diesel fuel. He also forecast eventual annual U.S. sales of 150,000 units.
Allen Schaeffer, executive director of the non-profit diesel-advocacy group, Diesel Technology Forum, expresses surprise at the notion Honda did not foresee testing problems.
In terms of performance and emissions achievements, we’ve seen data presented at technical conferences that (Honda) could make this system work,” Schaeffer says. “People don’t make those kinds of announcements without expecting to meet emissions standards.”
To meet stringent Tier 2, Bin 5 EPA emissions standards, Honda said it would use a catalytic converter to reduce oxides of nitrogen, instead of introducing urea to the engine exhaust – a strategy employed by most European auto makers.
Recent months have proven difficult for U.S. diesel enthusiasts. The cancellation of the Acura program is the latest in a string of pullbacks.
In September, Chrysler LLC admitted it was postponing plans to market a Jeep Grand Cherokee SUV equipped with a Mercedes Bluetec diesel engine.
Toyota Motor Sales U.S.A. Inc.’s Jim Lentz later said the auto maker was reviewing its strategy to bring a diesel engine to market in its Tundra fullsize pickup truck and Sequoia large SUV.
Both Chrysler and Toyota cite the high cost of diesel fuel as a problem, as well as the added expense of the emissions technology necessary to meet EPA requirements.
Despite diesel fuel prices that topped $5 per gallon in the U.S. during the summer, a top American Honda official was high on diesel’s arrival in Acura’s lineup as recently as July, insisting the math still worked in the auto maker’s favor.
“The (fuel) efficiency (of a diesel engine) is greater than the price differential, so it still makes some sense,” Dan Bonawitz, vice president-corporate planning and logistics, said at the time.
Diesel Technology Forum’s Schaeffer says there is light at the end of the tunnel, citing more diesel-equipped vehicles than ever on their way to the U.S. in the months ahead.
“This year, we’re looking at the BMW 3-Series (and) X5 (and) Audi Q7 coming,” he says of future diesel-equipped models. Volkswagen AG’s success with the Jetta TDI also is proof diesel has a future in the U.S. “There are waiting lists for that vehicle,” he says.
“Diesel fuel prices are moderating in some parts of California,” adds Schaeffer, noting a gallon of diesel costs less there than a gallon of gasoline. “We’re seeing the fuel trends go the right way.”
10-30-2008, 11:03 AM
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It appears to be pretty certain at this point. What a let down. I have been hoping for a Honda or Acura diesels for several years now. I've accepted delays, but I was so happy when I heard the TSX would get a diesel. Now this?
TOV also noted Subaru will likely delay their diesels until at least 2010. Sounds to me like the Japanese are backing out of their diesel bullishness. This will leave the Germans to be the big diesel producers once again. The problem is, I won't touch most German cars, especially ones as poorly built as the VW Jetta.
I'm still not sure on what the main reason for pullout is. On one hand there was mention of failure to pass emissions tests. On the other hand, it seems like raw materials prices and diesel fuel prices are a concern. Also, seeing how this lines up with the fall in fuel prices from $5/gallon to under $3/gallon, I would not be surprised if this played a role. Still, with the clean diesels from VW getting so much consumer attention, it seems like a big mistake.
TOV also noted Subaru will likely delay their diesels until at least 2010. Sounds to me like the Japanese are backing out of their diesel bullishness. This will leave the Germans to be the big diesel producers once again. The problem is, I won't touch most German cars, especially ones as poorly built as the VW Jetta.
“This year, we’re looking at the BMW 3-Series (and) X5 (and) Audi Q7 coming,” he says of future diesel-equipped models. Volkswagen AG’s success with the Jetta TDI also is proof diesel has a future in the U.S. “There are waiting lists for that vehicle,” he says.
Last edited by spurfan15; 10-30-2008 at 11:07 AM.
10-30-2008, 11:46 AM
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It appears to be pretty certain at this point. What a let down. I have been hoping for a Honda or Acura diesels for several years now. I've accepted delays, but I was so happy when I heard the TSX would get a diesel. Now this?
TOV also noted Subaru will likely delay their diesels until at least 2010. Sounds to me like the Japanese are backing out of their diesel bullishness. This will leave the Germans to be the big diesel producers once again. The problem is, I won't touch most German cars, especially ones as poorly built as the VW Jetta.
I'm still not sure on what the main reason for pullout is. On one hand there was mention of failure to pass emissions tests. On the other hand, it seems like raw materials prices and diesel fuel prices are a concern. Also, seeing how this lines up with the fall in fuel prices from $5/gallon to under $3/gallon, I would not be surprised if this played a role. Still, with the clean diesels from VW getting so much consumer attention, it seems like a big mistake.
TOV also noted Subaru will likely delay their diesels until at least 2010. Sounds to me like the Japanese are backing out of their diesel bullishness. This will leave the Germans to be the big diesel producers once again. The problem is, I won't touch most German cars, especially ones as poorly built as the VW Jetta.
I'm still not sure on what the main reason for pullout is. On one hand there was mention of failure to pass emissions tests. On the other hand, it seems like raw materials prices and diesel fuel prices are a concern. Also, seeing how this lines up with the fall in fuel prices from $5/gallon to under $3/gallon, I would not be surprised if this played a role. Still, with the clean diesels from VW getting so much consumer attention, it seems like a big mistake.
10-30-2008, 11:46 AM
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And if it means we get a V6 sooner than win-win for me. 
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