Acceleration, not speed, behind BMW diesel launch in U.S.

Sun Jan 13, 2013 6:48pm EST
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By Christiaan Hetzner

WOODCLIFF LAKE, New Jersey (Reuters) - BMW has a message for the incorrigible speed freaks looking for a more politically correct set of wheels in this era of energy efficiency: switch to a diesel.

The German luxury carmaker is rolling out a new range of sporty new diesel sedans in the United States this year to complement its sole diesel on offer - the X5 xDrive 35d sport utility vehicle - and believes the hitherto unloved powertrain will find greater acceptance in an age of downsized engines.

Diesels boast roughly 25 percent improved fuel consumption versus conventional cars, but their renaissance in the U.S. market long prophesied by German automakers such as Volkswagen (VOWG_p.DE: Quote) and Mercedes-Benz (DAIGn.DE: Quote) has been an uphill battle due to a poor image, higher fuel prices relative to gasoline and a spotty filling station infrastructure.

"The X5 diesel is selling like hot cakes, so we know from the X5 how strong customer acceptance can be as long as you have the right product," said Ludwig Willisch, president of BMW of North America, during an interview at its Woodcliff Lake headquarters on the outskirts of New York City.

"The next step then is launching a four-cylinder diesel in the 3 Series and a six-cylinder diesel in the 5 Series in the market this year," he continued, speaking prior to this week's North American auto show in Detroit.

Roughly a quarter of the 56,800 X5 SUVs that BMW sold last year were equipped with a diesel engine rather than a conventional gasoline engine, which Willisch said makes the SUV the second-best-selling diesel in the United States after the much cheaper Volkswagen (VOWG_p.DE: Quote) Jetta TDI.

A German national, Willisch previously headed up the group's sales activities for Europe, where diesel penetration steadily rose from over 20 percent in 1997 to 56 percent last year, due partly to a more beneficial tax treatment in many countries.

Luxury carmakers like BMW also tend to be more dependent on diesels than their mass-market peers. Fuel bills would make the total cost of owning a large sedan or a heavy SUV much higher in Europe were the vehicles powered by gasoline. Two-thirds of BMW brand cars sold in Germany last year were diesels.   Continued...

A BMW logo is seen on the rim of a BMW 650i xDrive car on media day at the Paris Mondial de l'Automobile, September 28, 2012. REUTERS/Christian Hartmann