With widespread use decades away, diesel technology is better route to reducing emissions now, carmaker's top U.S. boss says
David Shepardson / Detroit News Washington Bureau

Washington -- Audi's top U.S. executive said here Monday that political leaders have "fallen in love" with electric vehicles even though widespread use may be two decades away.

At a speech at the National Press Club, Audi of America President Johan de Nysschen reiterated his belief that vehicles like the extended-range plug-in electric Chevrolet Volt are not currently financially viable without government support and that existing technologies are better served to help drivers get better gas mileage.

"I understand why political leaders have fallen in love with hybrids and electrics. But this may be the one time you'll hear someone in Washington say it shouldn't be a monogamous relationship," de Nysschen said.

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President Barack Obama, however, is one of those enthusiastic backers of electric vehicles. The administration awarded $2.4 billion in cash grants in August to spur electric vehicle and battery improvements. He wants 1 million plug-in electric vehicles on the road by 2015.

The Obama administration released a report Monday saying that because of its efforts, the United States will have enough advanced battery capacity to produce 500,000 plug-in hybrid electric vehicles a year by 2015.

The administration also is working to have 10,000 electric vehicle charging stations by 2015 nationally, up from less than 500 this year. It predicts three electric vehicle factories and 30 advanced battery factories in the United States by 2015.

De Nysschen favors using diesel technology and allowing the marketplace to pick the winners and losers. He urged the government not to be "prejudging winning and losing technologies" and urged more work to standardize biodiesel rules.

He noted that if one-third of U.S. vehicles used diesel power, "America would save 1.5 million barrels of oil a day" -- the same amount the United States imports from Saudi Arabia daily.

"I make no apologies for being the world's biggest diesel advocate," de Nysschen said.

Over half of Audi's sales in Europe are diesels. Audi has two diesels in the U.S. market, and the A3 TDI was awarded the "Green Car of the Year" during press days at the Los Angeles Auto Show two weeks ago. De Nysschen said Audi was likely to offer a clean diesel alternative "in every one of our product lines," noting that diesels can be big players in reducing emissions and fuel use because they are about 30 percent more efficient than traditional gasoline engines.

The world's major nations are meeting in Copenhagen at the United Nations Climate Conference, working to set limits on greenhouse gas emissions, which are linked to climate change. Last week, the Environmental Protection Agency declared tailpipe emissions a threat to public health, clearing the way for tough new limits on emissions starting in the 2012 model year.

Automakers already are improving fuel technologies and building cleaner vehicles, but stricter rules will add significant costs to an already strapped industry. Automakers and others with the White House and California reached a deal in May to increase fuel efficiency standards to an estimated fleetwide 34.1 mpg by 2016 -- a move that will cost automakers $60 billion.
Greenhouse gains touted

The stricter rules will reportedly reduce 950 million metric tons of greenhouse gas emissions, which is equivalent to taking 42 million cars off the road; saving about $3,000 per vehicle in fuel; and conserving 1.8 billion barrels of oil over the lifetime of vehicles produced between 2012 and 2016, according to government figures.

"We have to get on with the electrification of our industry anyway," Bill Ford Jr. said Monday in Washington, adding that whether because of concern about climate change or energy security, most people can agree moving away from oil is in the national interest. "That's something we do need government collaboration and help with."

However, with low gas prices it's hard to convince consumers to buy more expensive hybrids and plug-in vehicles. The latter has yet to hit the mass market and will cost significantly more than gasoline-powered cars.

General Motors Co. plans to start selling the extended range Volt that will travel up to 40 miles on battery power late next year.
Plug-in subsidies needed

"The 50 percent or so price increase that the Volt represents over a similar gasoline car cannot be offset through the savings from reduced fuel compensation," de Nysschen said. "The only way to offset the extreme premium is through taxpayer-funded subsidies."

Congress has approved tax breaks of up to $7,500 for electric vehicles like the Volt. "Paying customers to drive your cars is not sustainable," de Nysschen said.

GM plans on producing about 8,000 Volts for the 2011 model year before eventually expanding to as many as 60,000. GM will sell the Volt in limited markets, starting in California and other unannounced places.

"Years from now, we'll look back at this period as a time of great progress -- the 'tipping point' that enabled the age of electrically driven vehicles," GM vice chairman Bob Lutz said this month. "It will be every bit as momentous as the transition from horses to horsepower."