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Ward's Auto Confirms: Honda Cancels Acura Diesel
 Date: October 30, 2008 11:04
 Submitted by:  JeffX
 Source: Christie Schweinsberg, Asia Editor - Ward's Auto World
 Credibility Rating: Not Specified

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.”

Related Link: REUTERS: Honda could delay Japan, US clean diesel launch

Last edited by JeffX on October 30, 2008 16:10

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