The 65 mpg Ford the U.S. Can't Have

[John S. Veteran]

In 25 years of driving, I've only purchased one car that wasn't a Ford. Given the current state of American automakers, this article really ticks me off. One area they aren't competing at all in, and we'll never see this in the US.

If ever there was a car made for the times, this would seem to be it: a sporty subcompact that seats five, offers a navigation system, and gets a whopping 65 miles to the gallon. Oh yes, and the car is made by Ford Motor, known widely for lumbering gas hogs.

Ford's 2009 Fiesta ECOnetic goes on sale in November. But here's the catch: Despite the car's potential to transform Ford's image and help it compete with Toyota Motor and Honda Motor in its home market, the company will sell the little fuel sipper only in Europe. "We know it's an awesome vehicle," says Ford America President Mark Fields. "But there are business reasons why we can't sell it in the U.S." The main one: The Fiesta ECOnetic runs on diesel.

Automakers such as Volkswagen and Mercedes-Benz have predicted for years that a technology called "clean diesel" would overcome many Americans' antipathy to a fuel still often thought of as the smelly stuff that powers tractor trailers. Diesel vehicles now hitting the market with pollution-fighting technology are as clean or cleaner than gasoline and at least 30% more fuel-efficient.

Yet while half of all cars sold in Europe last year ran on diesel, the U.S. market remains relatively unfriendly to the fuel. Taxes aimed at commercial trucks mean diesel costs anywhere from 40 cents to $1 more per gallon than gasoline. Add to this the success of the Toyota Prius, and you can see why only 3% of cars in the U.S. use diesel. "Americans see hybrids as the darling," says Global Insight auto analyst Philip Gott, "and diesel as old-tech."

None of this is stopping European and Japanese automakers, which are betting they can jump-start the U.S. market with new diesel models. Mercedes-Benz by next year will have three cars it markets as "BlueTec." Even Nissan and Honda, which long opposed building diesel cars in Europe, plan to introduce them in the U.S. in 2010. But Ford, whose Fiesta ECOnetic compares favorably with European diesels, can't make a business case for bringing the car to the U.S.

TOO PRICEY TO IMPORT

First of all, the engines are built in Britain, so labor costs are high. Plus the pound remains stronger than the greenback. At prevailing exchange rates, the Fiesta ECOnetic would sell for about $25,700 in the U.S. By contrast, the Prius typically goes for about $24,000. A $1,300 tax deduction available to buyers of new diesel cars could bring the price of the Fiesta to around $24,400. But Ford doesn't believe it could charge enough to make money on an imported ECOnetic.

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.

The question, of course, is whether the U.S. ever will embrace diesel fuel and allow automakers to achieve sufficient scale to make money on such vehicles. California certified VW and Mercedes diesel cars earlier this year, after a four-year ban. James N. Hall, of auto researcher 293 Analysts, says that bellwether state and the Northeast remain "hostile to diesel." But the risk to Ford is that the fuel takes off, and the carmaker finds itself playing catch-up?despite having a serious diesel contender in its arsenal.

[Hurmoth]

And this is one of the reasons why Ford isn't doing good in the American markets. Until American companies get a clue, the overseas auto makers will continue to gain here.

[NOTE] I understand why they cannot import, but why not just build it over here?

[psybapunk]

<snipped>

[Fred Derf Veteran]

[NOTE] I understand why they cannot import, but why not just build it over here?

They would have to have a special diesel production line and they do not believe that spending money to target 3% of the market is a worthwhile investment.

[Hurmoth]

They would have to have a special diesel production line and they do not believe that spending money to target 3% of the market is a worthwhile investment.

I can't imagine though that with the way gas prices are, only 3% would purchase this. But I guess that's just me. At 65MPG, that would certainly save some money.

[revvo]

Ford will bring a Fiesta in the US, but it definitely won't be this one, or drive like it too.

It's annoying to see a company (Ford, GM) make better cars outside of its home country. That's not the case with Japanese carmakers like Honda and it certainly ain't for Euro automakers where they have diesel versions of several luxury cars that perform just as nicely and are more economical.

[majortom1981]

The problem with diesels in the US is diesel in a lot of places is more then $1 more then regular gas. IS more mpg really worth it when fuel is more then a regular gas car?

Same argument as a prius if you have a corolla is it really worth it to get the car when its a good amou tn more then a regular corolla?

Gas by me is $3.69 while diesel is $4.53

[Fred Derf Veteran]

I can't imagine though that with the way gas prices are, only 3% would purchase this. But I guess that's just me. At 65MPG, that would certainly save some money.

They would need to battle public perception that diesel is smelly, bad for the environment and old technology. They may also need to lobby governments to reduce diesel taxes based that were created years ago in response to those concerns.

They must believe that the cost of new production line, combined with the cost of advertising enough to change attitudes and the cost of lobbying governments is just not worth it. Perhaps they plan to let some other company do the pioneer work and then swoop in and take over.

The problem with diesels in the US is diesel in a lot of places is more then $1 more then regular gas. IS more mpg really worth it when fuel is more then a regular gas car?

Diesel in Canada now costs about the same per litre as gasoline (if not less). It used to cost more but the price of diesel didn't seem to rise as quickly as the price of gasoline.

[zivan56]

The same thing happened to the SMART car...it sold international (including Canada) as diesel only. However, once it finally came to the US, it was gasoline only.

[Hurmoth]

The problem with diesels in the US is diesel in a lot of places is more then $1 more then regular gas. IS more mpg really worth it when fuel is more then a regular gas car?

Same argument as a prius if you have a corolla is it really worth it to get the car when its a good amou tn more then a regular corolla?

Gas by me is $3.69 while diesel is $4.53

Well look at it this way...

Let's say this thing has a 10 gallon tank (we'll say that this is the corolla)

It costs 36.90 to fill up the gas car

It costs 45.30 to fill up the diesel

You get 35MPG (EPA standard) in the gas car, which gives you 350 miles per tank

You get 650 miles per tank with the diesel, 300 miles more.

That breaks down to 9.5 miles per dollar in the gas car

vs

14.3 miles per dollar

The better value is still diesel. And value does matter in the long term.

[The_Decryptor Veteran]

The problem with diesels in the US is diesel in a lot of places is more then $1 more then regular gas. IS more mpg really worth it when fuel is more then a regular gas car?

...

It depends on how efficient your current car is.

Diesel might be $1 more per gallon, but if it ends up using 10 gallons less, you're saving money.

[Fred Derf Veteran]

The same thing happened to the SMART car...it sold international (including Canada) as diesel only. However, once it finally came to the US, it was gasoline only.

The Smart Cars sold in Canada now seem to be gasoline engines. I had thought they were a diesel car when they first came here but it doesn't seem to be that way now.

[RAID 0]

...and people wonder why the US auto makes are dying. I've never loved Ford, in fact i hate them with a passion.

Long live Honda.

[zivan56]

The Smart Cars sold in Canada now seem to be gasoline engines. I had thought they were a diesel car when they first came here but it doesn't seem to be that way now.

What a stupid move. Most of the ones sold here (in Vancouver) were the diesel CDi versions. I guess they wanted a single North American only product.

[DKasler]

Erm... I wouldn't step foot in that car if it was given to me for free.

[PGHammer]

Also, what about crash-worthiness?

In order for Ford to be able to build (or import) the vehicle into the US, the car must meet crash-worthiness standards. (The Japanese ulta-minis are highly successful in Japan; however, none are available in the US for safety reasons; it's also why the original Mitsubishi Lancer and Nissan Skyline were never imported into the US.)

Fuel-efficient vehicles have issues when it comes to crash-worthiness (historically, subcompact cars as a class have the *worst* insurance rates among non-high-performance vehicles, while SUVs and pickups have some of the best such rates). Also, at least in North America, fuel is cheaper compared to the EU and Japan.

Data point: the GMC Typhoon, the fastest production SUV ever built, remains cheaper to insure than a Chevrolet Camaro or Pontiac Firebird of the same year, despite actually being faster.

Safety often trumps fuel-efficiency, at least in North America.

[Hurmoth]

Erm... I wouldn't step foot in that car if it was given to me for free.

A free car? Seriously? :blink: Are you loaded?

If someone gave me a car for free, I wouldn't say no, especially if it got 65MPG.

[MR_Candyman]

Also, what about crash-worthiness?

In order for Ford to be able to build (or import) the vehicle into the US, the car must meet crash-worthiness standards. (The Japanese ulta-minis are highly successful in Japan; however, none are available in the US for safety reasons; it's also why the original Mitsubishi Lancer and Nissan Skyline were never imported into the US.)

Fuel-efficient vehicles have issues when it comes to crash-worthiness (historically, subcompact cars as a class have the *worst* insurance rates among non-high-performance vehicles, while SUVs and pickups have some of the best such rates). Also, at least in North America, fuel is cheaper compared to the EU and Japan.

Data point: the GMC Typhoon, the fastest production SUV ever built, remains cheaper to insure than a Chevrolet Camaro or Pontiac Firebird of the same year, despite actually being faster.

Safety often trumps fuel-efficiency, at least in North America.

Too bad our standard here aren't as good as there where it REALLY counts. The DOT is far behind where they should be when doing testing. It's not that european cars are less safe by any means. They gets trumped up by bumper and light height and don't care about the real safety aspects.

[kombolcha]

The problem with diesels in the US is diesel in a lot of places is more then $1 more then regular gas. IS more mpg really worth it when fuel is more then a regular gas car?

Same argument as a prius if you have a corolla is it really worth it to get the car when its a good amou tn more then a regular corolla?

Gas by me is $3.69 while diesel is $4.53

even if a you had a diesel that got >45mpg compared to a 25mpg gas car, it's still worth paying the extra per gallon for the diesel.

i've done the math a while back comparing my car's avg 24mpg to a 45mpg diesel that will never be sold here, even up to $6/gal the diesel was better choice for money and mileage.

[aludanyi]

OK, but one question... what about the average mileage difference between the US and Europe, it is around 2x more in the US. So do you really believe that those little cars can handle the mileage? In Europe a 5-6 year old car usually have around 60000 miles on the counter, in the US that is more than 100-120000. I have drive small and large cars, the small one can't handle that mileage I am sure, and the servicing cost will be much higher than the savings on fuel cost. You just can't compare a Fiesta with an F-150 or even with a much smaller car. Other thing, can you imagine what would happen with you if an F-150 or a big SUV hit you in that small car? It's just not made for America.

[BGM]

OK, but one question... what about the average mileage difference between the US and Europe, it is around 2x more in the US. So do you really believe that those little cars can handle the mileage? In Europe a 5-6 year old car usually have around 60000 miles on the counter, in the US that is more than 100-120000. I have drive small and large cars, the small one can't handle that mileage I am sure, and the servicing cost will be much higher than the savings on fuel cost. You just can't compare a Fiesta with an F-150 or even with a much smaller car. Other thing, can you imagine what would happen with you if an F-150 or a big SUV hit you in that small car? It's just not made for America.

this man makes a fair point, it would get laughed off the road in the US

[zeta_immersion]

One aspect is that american cars are not really that dependable ... take ford/gm vs honda/toyota ... then again ...

also europeans don't put much thought into safety ... again ... look at the autobahn and any US/canadian highway ... also the accident rates and insurance ....

not to overstate the importance of a bigger car but to compare an F150 vs a Honda Civi in an accident is to compare a Tractor Trailer (TIR) with a Smart Car ... (is just stupid) ...

also yesterday or today i saw that OPEC want to cut back on production ... hence higher price on gas ... .... is it just me or gas companies have a monopoly over everyone .. (not even MS is as powerful as any gas company) ... which is crazy

[Glen]

OK, but one question... what about the average mileage difference between the US and Europe, it is around 2x more in the US. So do you really believe that those little cars can handle the mileage? In Europe a 5-6 year old car usually have around 60000 miles on the counter, in the US that is more than 100-120000. I have drive small and large cars, the small one can't handle that mileage I am sure, and the servicing cost will be much higher than the savings on fuel cost. You just can't compare a Fiesta with an F-150 or even with a much smaller car. Other thing, can you imagine what would happen with you if an F-150 or a big SUV hit you in that small car? It's just not made for America.

This is a very good point overall and I'd like to see statistics on total cost of ownership of these types of vehicles over a 8 to 10 year period. I currently drive a Toyota Matrix and for me Honda & Toyota offer the best of good fuel economy and low maintenance / high resale value. I somehow doubt that this little car would be able to compete in that market in the U.S.

[aludanyi]

And if someone is interested in another fact... the average price of a gallon of gasoline in Europe is $7.50-$8.50, so...

[SIE]

Ok a few things, one i'm not 100% sure of but anyway.

1. I always thought UK safety standards were allot higher than in the US?

2. Reliability, diesel engines are allot more reliable than gas/petrol cars, you can easily pick up a diesl with 100,000+ miles on the clock and it will still run like new, aslong as it's been looked after of course.

3. Engine aside, allot of americans wouldn't be seen dead driving something like that, thats the reason why it's not going there.