Summer’s coming — and so (probably) are higher gas prices.
There has already been a nationwide uptick of about 40 cents a
gallon over the past few months — and we’re still a few weeks away
from spring. It’s likely we’ll see over $4 a gallon gas
after spring arrives — and maybe more than that by high
summer. (In California, gas is already close to $5 a gallon.)
Even “cheap” $3 a gallon gas is about twice as expensive as it
was just a few years ago. We’ve just become used to it. But that
doesn’t mean we can afford it.
Diesel-powered cars could be our salvation — and a bunch of new
ones are going to be available within the next 6-12 months,
including diesel versions of the 2014 Jeep Grand Cherokee SUV and
Chevy Cruze and Mazda3 compact sedan/hatchback wagons. These will
go much farther on a gallon of fuel than their gas-engined
equivalents. The diesel Cruze and Mazda3, in particular, should be
capable of averaging close to 40 MPG — and (unlike most hybrids)
remain exceptionally fuel-efficient at highway speeds.
But, there’s a fly in the soup. Three flies,
actually.
First, there’s the higher initial cost of a diesel-engined car
vs. its gas-engined equivalent. The MSRPs of the ’14 diesel Grand
Cherokee, Cruze, and Mazda3 haven’t been revealed yet, but in the
past — and right now — a diesel typically costs about $2,500 more
“up front” than the same car with a gas engine. Sometimes,
considerably more than that. As an example, a 2013 VW New Beetle
diesel lists for $23,295. The standard New Beetle (with gas engine)
stickers for $19,795. While the diesel Beetle is much more
economical to operate (28 city, 41 highway vs. 22 city, 31 highway)
it’ll take at least a few years of driving to work off the diesel’s
$3,500 price premium. And that’s assuming you’re in a position to
do so. For many buyers, ponying up an extra $3,500 at buy-time (or
finance time) just isn’t doable — even if the car costs less to
operate.
Second, there’s the fuel issue. Though a gallon of diesel will
take you farther down the road than a gallon of gas (especially a
gallon of ethanol-adulterated “gas”) it also costs more to buy the
gallon of diesel — chiefly because of government “ultra low
sulfur” diesel fuel requirements. Diesel used to be
cheaper to buy than gas, in part because diesel used to
cost less to refine. Now, it costs more — because of the ULS
requirements, which have increased refining costs significantly.
These government-imposed costs are passed on to consumers.
At the time this article was written in early March 2013, diesel
was selling for just a few cents shy of $4 a gallon in the
Southeast — about 30-40 cents more per gallon than regular
unleaded. That’s no small thing when factored out over a period of
years. It could in fact be a large enough thing — if that 30-40
cent per gallon spread stays roughly constant during the years you
own the vehicle — that (combined with the higher up-front costs
you had to pay) you end up about the same (money wise) as you would
have had you bought the gas-engined version of the vehicle.
Which brings me to the third issue — which is related
to the second issue (ULS diesel fuel). To comply with
ultra-strict tailpipe emissions requirements (specifically, oxides
of nitrogen), many new diesel-powered cars have some form of urea
injection. The urea is not burned in the engine but sprayed into
the exhaust stream to chemically alter the exhaust before it leaves
the tailpipe. It is akin to catalytic converters in gas-engined
cars, but with a difference: The urea tank must be periodically
replenished. And the urea isn’t free.
So, how much does it cost?
Here’s one example: The urea tank in a current (2013) Mercedes
M-Class diesel holds about 8 gallons of “AdBlue” urea. This is
sufficient — according to Mercedes — for about 10,000 miles of
driving. The urea costs (at current prices) about $16 a
gallon.[*]
So, it costs about $130 extra every 10,000 miles to operate the
vehicle. Over 100,000 miles, that’s an additional $1,300 in
operating expenses.
It’s not a huge expense - in isolation. But when you
add that expense to the expense of the diesel vehicle itself (a new
Benz ML350 diesel stickers for $51,270 vs. $49, 770 for the
gas-engined equivalent version) then factor in the higher cost of
the diesel fuel, diesel loses a lot of its economic luster.
However, there are a few important things that must also be said
in defense of diesels — things that can greatly compensate for the
issues raised above.
First, diesels last. Because they (usually) have
extremely high-compression ratios (to ignite the fuel by pressure
and heat rather than spark, as in a gas engine) they are (again,
usually) built much stronger — tougher blocks, tougher internals.
Built right, treated right, a diesel engine should be capable of
at least 200k — without more than routine service. That’s
how you can make your money back — especially relative to a hybrid
car. While hybrids have proved to be very reliable and durable,
their gas engines — and electric batteries — aren’t made to go a
quarter-of-a-million miles. Diesel engines — historically — have
gone that far routinely. But remember: To make the math
work for you, you’re probably going to have to put a lot of miles
on the clock.
Second, diesels — modern diesels — perform. As in —
they accelerate. Quickly. Unlike most hybrids. Which
don’t. A modern diesel-powered car is fun to drive.
Few hybrids are.
Bill Hussein O'Stalin| 3.8.13 @ 6:38AM
There isn't anything the government hasn't screwed up except a turkey pot pie and I'm sure there is some bureaucrat working on that issue.
arlo price| 3.8.13 @ 7:11AM
However, in actuality, Uncle Sugar should be totally behind this as diesel fuel has a .06 per gallon higher tax than gasoline. Then again, in Washington's line of thinking this tax should be increased because fewer gallons are being used to drive the same distance as a gas powered car.
Moe Blotz| 3.8.13 @ 8:54AM
The Federal tax differential between gas and diesel came into being in the mid 1970s when our progressive rulers decided that heavy trucks were not paying their fair share of highway maintenance. The proponents of the higher tax looked at the actual tax rate rather than the tax paid. Class eight trucks in that era averaged about four miles per gallon and automobiles perhaps five times that. States followed suit and slapped a diesel penalty on fuel. As of December 2012 California and seven other states had no gasoline tax. (REF: IFTA Final Fuel Use Tax and Rate Code Table 1)
OP4| 3.8.13 @ 7:42AM
If the EPA could make a few changes, we could all of the European spec diesels. Some, like the VW Polo get upwards of 70 mpg. I prefer a diesel over a hybrid.
Like Arlo said, the Feds and most states tax diesel at a higher rate - which is idiotic.
Harry the Horrible| 3.8.13 @ 10:22AM
Darn! Mileage like that could almost make up the difference in cost!
The EPA must be brain-dead.
Bob K| 3.8.13 @ 7:56AM
Not to mention how much higher the price of food and other commodities are because they are delivered to the markets in diesel powered trucks.
Moe Blotz| 3.8.13 @ 8:41AM
Tell me, BobK, what would be a more efficient mode of transportation for delivering goods to market than diesel powered trucks.
JayDick| 3.8.13 @ 2:22PM
Trucks are probably unavoidable for the last few miles, but railroads should be much more efficient over longer distances. Like so many other things, however, the government screwed up the railroads long ago and they have never fully recovered.
Moe Blotz| 3.8.13 @ 7:46PM
With railroad transportation you would no longer have fresh meats and vegetables available in your grocery store, fresh flowers on your table, or three day delivery from coast to coast. Once a rail car is fully loaded with goods, it then must be dragged to a rail yard to be consolidated into a train. The train then leaves the rail yard and proceeds to the next rail yard where rail cars are removed for local delivery and others are added for the train to continue. That is why rail transport takes weeks to move products from coast to coast, border to border. The last few miles for a shipment moving by rail could be up 100 miles, necessitating delivery by a truck. Government did not screw up the railroads, they were in bed together and truck transportation beat them. Just as railroads were more efficient than barge and mule train, trucks are more efficient than rail. Moving coal, grain, petroleum and other bulk commodities over long distances is more efficient by rail. If you want something in a hurry, call a trucking company.
Bob K| 3.9.13 @ 9:16AM
Moe,
There is no more efficient way than diesel to deliver goods to market. Why else did we built our Interstate Highway System?
And this is the best reason of all to junk the EPA regulations that have raised the price of Diesel Fuel. They are some of the best examples of the Law of Unintended Consequences that can be found!
Bob K| 3.9.13 @ 9:18AM
Make that "build"--not "built." jeeeez
SCPOret| 3.9.13 @ 9:43AM
We built the interstate system under Eisenhower. It's purpose was to be able to move troops to embarkation points faster.
The use by trucks and cars was an added benefit, but it was not the purpose behind the interstate system.
Bob K| 3.9.13 @ 11:06AM
Nonsense!
You have it absolutely backwards! Because it is there it can be used to move troops also. It wasn't built for that purpose.
Give Eisenhower and our government leadership after the war some credit. The war was over!
We were the only country to get out of WWII without any damage to it's homeland. We knew we were going to be the economic giant in the world. It was obvious.
The Interstate Highway system was built because it was the infrastructure that the USA needed to expand it's industries and the employment opportunities for returning veterans.
Do you really believe that the voters in our democratic republic would have supported this for military reasons alone?
Stan Redmond| 3.10.13 @ 2:03PM
Actually SCPoret is correct mostly. The system as we know it now was sold as a defense project even though it was paid for with funds in the highway system trust. Eisenhower signed the National Interstate and Defense Highways Act of 1956 aka Federal-Aid Highway Act of 1956.
The Interstate system was already under way in the early 1900s as a military necessity.
Bob K| 3.11.13 @ 1:14AM
Yes. Thanks to our military which had us ready to enter WWII when Pearl Harbor happened we have a highway system that was perfect to encourage the rise of Capitalism and the completion of the Manifest Destiny of the United States.
Has anybody written a history of the United States with that as it's main theme?
Appleby| 3.11.13 @ 7:03AM
Why does Hawaii have an interstate highway?
Moe Blotz| 3.8.13 @ 9:10AM
Eric did not mention the diesel particulate traps mandated on all diesel engines beginning in 2008. The exhaust gases are so hot that you can fry a body part if you get into the stream. The particulate trap burns off accumulated carbon periodically and produces so much back pressure that the engine practically dies until the process ends. Dodge's Cummins engines were having problems with turbochargers and exhaust valves caused by the back pressure. The best solution is to remove the catalytic converter and particulate trap, then replace the entire exhaust system with a free flowing set up. Fuel mileage improves drastically and the vehicle operator realises better performance.
Also with diesel, if you put vegetable oil in your tank it is more likely to gel at temperatures below freezing. Biodiesel does not have the cetane rating (as has octane rating) of straight diesel and produces less power. Add the expense of a good fuel additive to make up for the lost lubricity of ULSD and your cost per mile escalates as well. If your driving habits entail short hops of twenty miles or less with an occasional out of town trip, don't buy a diesel.
Moe Blotz| 3.8.13 @ 9:11AM
Dropped the G from (gas......) didn't I?
RFisher66| 3.8.13 @ 10:34AM
While you may not be able to get a quarter million miles out of a hybrid I see no reason why you can't get at least that out of a gas engine if you take care of it. I currently have 205,000 on my '06 Avalon and it runs as well as it did brand new. Still does 80+ in the quarter, tops out at 135mph-damn cut off-gets 30+mpg on the highway at 70+mph all day and burns less than a quart of oil every 5,000 miles. My last car, 1996 DeVille, ran to 300,000 miles and did as well. Car before that was a '90 Bonneville that went 250,000 before I blew the transmission and decided not to spend the money fixing it. Take care of your car and it will run forever.
JayDick| 3.8.13 @ 2:29PM
Modern gasoline engines are very durable if maintained properly, no doubt. Considering just the engine, however, a diesel will always outlast a gasoline engine, however, because, in addition to being built much stronger, diesel fuel has much better lubricating qualities than gasoline. All of this is largely moot, however, because the rest of the car will usually wear out long before the engine, as shown by your '90 Bonneville.
bac| 3.8.13 @ 11:25AM
Mr. Peters' remarks about the VW Beetle diesel vs. gas cars ignore the fact that the diesel comes with additional equipment standard. It is also the case that the diesel model depreciates at a significantly lower rate. Finally, while there is a significant price differential for diesel vs. regular gas there is much less difference vs. premium gas, which a lot of cars require. So it is not accurate to just look at the MSRP difference and calculate how many miles you would need to drive at the higher mpg to recover the cost-a more elaborate calculation is necessary.
Santiago| 3.8.13 @ 1:48PM
Diesel here in Chile is cheaper than gas, although both are pricey since the country has virtually no petroleum of its own and they have a specific gasoline tax on top of a VAT (the government here is financed mostly by the VAT and copper royalties rather than the income tax). I suppose diesel's price advantage here is due to the absence of the aforementioned federal sulfur regulations in the US........and meanwhile I can buy a new car (subcompact or even compact) here for as low as CLP 4.000.000 (USD $ 8500), or around CLP 6.000.000 (USD $12600) for a brand I've actually heard of.
I can't even begin to list all of the brands of cars available to consumers here in Chile that don't exist in the US........let's see Deng Feng Motors, Ssongyang, Geely, JAC, Suzuki (no longer making new cars in America), plus European companies like Renault, Citroen, Peugeot, MP, etc etc. With all the regulations constricting the market, it's no wonder that even in Yahoo Finance people are recognizing that a new car is more and more out of reach for Americans.
Even in today's edition in one of the local papers, La Tercera, I read that new car sales in Chile for last month (February), increased by a whopping 23% over the same month last year.........the gap between the 2 countries seems to be closing year by year. Sad for the US.
Al Adab| 3.8.13 @ 2:24PM
Any of us can see the price of diesel and regulation on ever grocery store shelf in America. Note also the empty sections of those shelves as fewer truckloads get to every store weekly.
Instead of the EPA pursuing its hybrid/alternative agenda it would better serve the consumer/citizens were it to back off the regulations, drop the urea nonsense and let free markets "solve" the problem which is only one manufactured by the agenda in any event.
Stan Redmond| 3.10.13 @ 2:06PM
I don't own a diesel Mercedes. But will anyone really refill the tank of urea? Or did the EPA force a kill switch to be installed to ensure compliance?
I would love a diesel automobile. I am in love with the 4x4 diesel Toyota Hi-Lux that I see all over South America and Mexico. BUT... Can't have them in the USA. Some EPA S.F.Brains says I can't.
Ain't it great that the feds now control the health care delivery system in this country?
Cloudbuster | 3.11.13 @ 4:22AM
Even if it did have a kill switch, would it be capable of telling if you filled the urea tank with just water? The solution used is already a water-based urea solution. Water is cheap.
RJ| 3.11.13 @ 2:08AM
Eric and Commenters - Thanks for the information. Great to read about automobiles and alternative power plants. Looking forward to Eric's next article.