The 65 mpg Ford, but the carmaker can't afford to sell it in the U.S.A.?

[Eagle Eye]

You gotta read it & see it to believe it.....

Story here

Ford plans to make a gas-powered version of the Fiesta in Mexico for the U.S. So why not manufacture diesel engines there, too? Building a plant would cost at least $350 million at a time when Ford has been burning through more than $1 billion a month in cash reserves. Besides, the automaker would have to produce at least 350,000 engines a year to make such a venture profitable. "We just don't think North and South America would buy that many diesel cars," says Fields.

OK, I don't know about you but it's time Mark goes to work somewhere else. We have many idle or 1/2 used engine plants that could make this motor. What a bunch of BS

[iceman]

sounds like US Oil companies pay too much for them not to bring it here ;)

If turbo diesel trucks can be profitable then surely there are enough people that owulf buy something like this and if they did then maybe the fuel would be more available. I wouldn't buy it I admitt but I expect many would.

I work from home though so I am still pretty green in the greater scheme of things....I rationalize it that way any how.

[Alloy Dave]

[Dad's72Mach]

I think a lot of Americans still associate diesel cars with the old smelly, smoky, slow starting glow plug Oldsmobiles and Volkswagons of the '80's. If this is true they may be a hard sell here.

[68fastback]

I think it's more a problem of gas is 3.69 and diesel is 4.55 and the EcoBoost 4-banger is much cheaper to produce and makes up most of that cost spread. Also diesel has a highly fixed production base and more demand will just drive the price out of sight. Prior to diesel pick-ups and some cars in the US diesel was considerably cheaper than gas and it was predicted then that deman would drive price up (which it did).

On the other hand I think there is a market for small diesels that didn't exist when folks changed cars ever couple of years, but realize that Mark Fields doesn't pull the stats out of his @$$ -- you can bet there's a lot of market analysis behind that decision ...it could also be a way to delay expectations until it's more financially worthwhile to respond.

I don't think it's plant space that's the problem -- space is cheap right now. It's all the build-specific fit-up that goes into the plant that's really expensive. Would the US market embrace a $30K Fiesta (or a $35K Focus as they do in Europe)? Dunno, but I'd rather see an alloy EcoBoost I-4 Verve or Focus than a diesel -- not because there's anything wrong with the diesel (besides maybe weight) since they offer good mileage, are [fnally] clean, and make great trorque, but because I think the economics simply aren't there at the bottom of the model food-chain in the US market given price points, fuel costs and competing technologies at this point in time.

[Birdman]

EE I understand your thoughts on this . I think maybe they ( us factories) are better suited to build the Econo boost engines than diesels.

I drive a diesel work truck every day. I can tell you I would never buy a diesel powered car . I really see absolutly no reason to . Fuel costs more for diesel than gas and if and when the econo boost is made available it would make way more sence to go with that when given the choice.

[Carnut]

I would buy the gas powered car long before I would the diesel. :Shades:

[Eagle Eye]

Originally Posted by 68fastback

I think it's more a problem of gas is 3.69 and diesel is 4.55 and the EcoBoost 4-banger is much cheaper to produce and makes up most of that cost spread. Also diesel has a highly fixed production base and more demand will just drive the price out of sight. Prior to diesel pick-ups and some cars in the US diesel was considerably cheaper than gas and it was predicted then that deman would drive price up (which it did).

On the other hand I think there is a market for small diesels that didn't exist when folks changed cars ever couple of years, but realize that Mark Fields doesn't pull the stats out of his @$$ -- you can bet there's a lot of market analysis behind that decision ...it could also be a way to delay expectations until it's more financially worthwhile to respond.

I don't think it's plant space that's the problem -- space is cheap right now. It's all the build-specific fit-up that goes into the plant that's really expensive. Would the US market embrace a $30K Fiesta (or a $35K Focus as they do in Europe)? Dunno, but I'd rather see an alloy EcoBoost I-4 Verve or Focus than a diesel -- not because there's anything wrong with the diesel (besides maybe weight) since they offer good mileage, are [fnally] clean, and make great trorque, but because I think the economics simply aren't there at the bottom of the model food-chain in the US market given price points, fuel costs and competing technologies at this point in time.

From a consumers stand point look at it from a cost per mile

gas = $3.69/gallon
best fuel economy std. they are shooting for by 2012 is 35 mpg
35mpg times 20 gallons = 700 mile range
20 gallon fuel tank @ $3.69 gallon = $73.80
$73.80 divided by 700 mile range = 0.105 cents (cost per mile)

diesel = $4.55/gallon
Ford Fiesta (diesel) fuel Economy is 65mpg
65mpg times 20 gallons = 1,300 mile range
20 gallon fuel tank @ $4.55 gallon = $91
$91 divided by 1,300 mile range = 0.07 cents (cost per mile)


That's a (3 1/2) cents per mile saving. If you drive 20,000 miles a year that = $700 less per year you spend for fuel & we use less barrels of oil driving demand down more because less gasoline needs to be made (which takes a lot more refining then diesel does) if you use Bio-fuel in the lower & warmer states it cost even less & oil companies are not need as much.

[black vert ss]

What I don't understand is why diesel costs more than gas when it takes less time and cost to refine it?

[Johnny Dangerously]

Originally Posted by black vert ss

What I don't understand is why diesel costs more than gas when it takes less time and cost to refine it?

Part of it is supply & demand. If more people wanted it, costs would come down. The other part is manufacturing related. It is my understanding that there are 2 primary ways to refine diesel from oil. The method that American refineries use is optimized to produce more gas & the method the European refineries use is optimized to produce more diesel. I'll post the two methods when I find them.


`

[Johnny Dangerously]

Here's the refining difference between the US & Europe.

Should American Vehicles go Diesel Just When the World is Running Short of it? - Column/Csaba Csere - The Steering Column/C/D Staff/Columns/Features/Car and Driver - Car And Driver


...oil refineries tend to fall into two categories: catalytic cracking and hydrocracking. Most U.S. refineries are set up for catalytic cracking, which turns each barrel of crude oil into about 50-percent gasoline, 15-percent diesel, and the remainder into jet fuel, home heating oil, heavy fuel oil, liquefied petroleum gas, asphalt, and various other products. In Europe and most of the rest of the world, refineries use a hydrocracking process, which produces more like 25-percent gasoline and 25-percent diesel from that barrel of oil...


`

[black vert ss]

thanks

[rown4au]

This post is likely to be unpopular but please don't kill the messenger!

:mafia20smile:

I work in the oil transportation biz and spend a lot of time looking at supply/demand in various parts of the world so I can say with a good degree of confidence that the cost of diesel relative to gasoline does not have anything to do with less Americans using it.

Distillate (diesel, gasoil, jet, kerosene) is the part of the oil barrel that drives commerce and most of the world outside America uses for the majority of its transportation needs. The demand destruction in the USA in the last year or so has been taken up by demand growth in developing economies, particularly those who subsidize their oil, as their citizens have not felt the pain as oil prices have risen and have happily kept consuming.



The particularly unpleasant thing is diesel is cheap here by global standards, both my wife and I drove diesel vehicles in the UK until we moved back recently and we were paying nearly $10 per gallon by the time we left. We also got up to 60 mpg from my wife's diesel Saab 9-3 on trips so compared to gas it was much more economical if you drove any kind of mileage, thus most of the vehicles were diesel.

I also don't think there is sufficient demand for a lot of diesel cars in the USA (yet), we like our big cars and we like them with big powerful engines with a lot of punch. (and I am no different thus the shelby and my F150...)

When we lived in the UK we had no problem with my pickup (2.5L TD) or my wife's Saab (2.4L TD) but I can tell you that you had to get used to the turbo lag. My F-150 and my wife's SUV are both much better off the line and I would really feel the difference now if I went back. That said, I do find it amazing that you can't even buy the Saab in the USA with the engine we had in ours, it was a really good set up and although it wasn't a dragster it did pretty well particularly once you were at highway speeds.

The good news for the global consumer is there is a lot of refining capacity coming on line early next year, one really big one in India and 3 more in China so this in conjunction with the global economic slowdown should help bring some of the refining margins down. I think crude is destined for $100 per barrel and could go as low as $85 for a short while but some OPEC members are already making noise about protecting a floor of $100 per barrel so I don't know how far below this level we are likely to see and demand is also likely to start to recover at around these price levels.

By the way as someone said in a previous post while our US refineries built to maximize gasoline production from the barrel, they are currently doing their best to maximizing distillate production right now because (until the last week or so) gasoline margins were dismal and there was a lot more money to be made making distillate.

Its a crazy world out there at the moment!

[68fastback]

Very interesting... thanks for the insights -Dan

[68fastback]

Originally Posted by Eagle Eye

From a consumers stand point look at it from a cost per mile

gas = $3.69/gallon
best fuel economy std. they are shooting for by 2012 is 35 mpg
35mpg times 20 gallons = 700 mile range
20 gallon fuel tank @ $3.69 gallon = $73.80
$73.80 divided by 700 mile range = 0.105 cents (cost per mile)

diesel = $4.55/gallon
Ford Fiesta (diesel) fuel Economy is 65mpg
65mpg times 20 gallons = 1,300 mile range
20 gallon fuel tank @ $4.55 gallon = $91
$91 divided by 1,300 mile range = 0.07 cents (cost per mile)


That's a (3 1/2) cents per mile saving. If you drive 20,000 miles a year that = $700 less per year you spend for fuel & we use less barrels of oil driving demand down more because less gasoline needs to be made (which takes a lot more refining then diesel does) if you use Bio-fuel in the lower & warmer states it cost even less & oil companies are not need as much.

EE, I think your logic is a stretch, tho.

Forst off you're comparing at fleetwide (CAFE) goal (35mpg) to a sub-compact single model diesel (65mpg).

But even using that logic, there's the much more expensive diesel that must be amortised over the ownership life of the original vehicle owner. Folks keep cars longer today but even if the original owner kept it for 100,000 miles (likely greater than the national average), the additional $3,500 for the diesel takes that many miles to break even in your comparo (3.5 cents for 100,000 miles).

Further, you're comparing to ideals (65mpg subompact and 2012 CAFE) but folks don't buy cars based on that, imho. Here's another viewpoint: EcoBoost/TT will deliver a mileage *gain* of 20% and diesel typically 30% (broadly, not a specific model, based on process/cycle efficiencies), so if I go to buy a new car my personal business case boils down to if that extra 10% is worth the added cost of the diesel and, for the majority of buyers it would not appear to be so.

Admittedly the diesel will last much longer, but the benefit of that is not accrued by first owner and after 10 years and 100,000 miles the residual value difference is not likely to be a big factor.

At least that's how I'd be viewing it all other things being equal -- which they may not be ...both plusses and minusses I can see on both sides too.

I think we'll definately see diesels become more popular in the US but I think given short-term competing tech (like EB/TT) the case is a tough sell at present. Sure, there will be buyers who commute long distances and for whom the tradeoffs might be a bit better, but is there a sufficiently high-volume business case to support such investments given all the givens? Apparently Ford's analysis says not. :shrug:

Remember EcoBoost is a Ford-stated "short-term" strategy. Maybe diesel starts to make more market sense for 2012 and beyond given all the givens?

[TOMMY GUN]

.

[Carnut]

Diesel fuel stinks, literally.

[black vert ss]

Originally Posted by Carnut

Diesel fuel stinks, literally.

Kinda like acorn farts

[Carnut]

:Bigguy:

[68fastback]

Originally Posted by Carnut

Diesel fuel stinks, literally.

I like the bio-diesel that smells like french-fries ...but it makes you hungry!