As petrol prices continue to soar, the demand for economical, environmentally friendly cars grows. Sales of diesel vehicles are on the rise, but some in the industry claim petrol/electric hybrid cars – not diesel – hold the long-term solution for greener motoring, says Ian McCawley
Awind of change is blowing through the motoring industry. With petrol prices soaring and sales of sports utility vehicles (SUVs) plummeting in the US, consumers are turning to more economical and eco-friendly cars.
Ford and Peugeot CitroÃ«n’s complaints about the exemption of petrol/electric hybrid cars from London’s Congestion Charge seem to have fallen on deaf ears as the Government ramps up its plans to convert drivers of gas-guzzling vehicles to “cleaner” cars.
Honda UK head of marketing Simon Thompson says: “The environmental debate is accelerating. The Government appears hell-bent on channelling technological development into hybrid engines.”
Thompson is well placed to comment. Honda stands seventh in the UK diesel market from a “standing start” a year ago. Its Diesel marques – the Accord, CRV and SRV – account for 15 per cent of its sales in the past 12 months, and Thompson sees Wieden & Kennedy’s award-winning “Grrr” ad campaign as the impetus behind this rapid growth.
According to the Society of Motor Manufacturers and Traders (SMMT), almost 36 per cent of new car registrations in the year to September 30 were diesel vehicles, with 16 per cent of all cars on the road using diesel.
All quiet on the diesel front
A spokesman for the trade body says: “In the past, diesel engines were noisy and performance was not great. Now most punters would not be able to tell the difference between petrol and diesel engines.”
Thompson agrees that technological advances in diesel engines, which no longer “clat and clack” according to the Grrr campaign, have made a big difference. But he does not believe diesel is the engine of the future. “The rise of diesel is a misnomer. It is two years off its peak,” he claims. “It is the current solution, but hydrogen-powered and hybrid cars – both of which Honda manufactures – are the way forward.”
Thompson cites the Government’s commitment to ensuring at least ten per cent of new cars have emissions of 100g of carbon dioxide per kilometre or lower as being “unachievable” with diesel.
His views about the coming popularity of hybrid cars are backed by SMMT figures for the first six months of 2005, which showed sales of hybrid petrol/electric cars up by more than 106 per cent.
Sales of the Toyota Prius hybrid show healthy growth. The marque had sold 3,057 cars this year by the end of September, and is on course to more than double its sales figures for 2004. Toyota GB marketing director Mark Hall says: “The Mark Two Prius hybrid is a phenomenal global success.
“Whereas the Mark One had a profile of buyers who were older and less concerned about what their car said about them, we know that interest in the five-door Mark Two hybrid has no age boundaries. The number of companies at this year’s Frankfurt Motor Show displaying hybrids shows consumer demand.”
What’s the alternative?
Hall disagrees with Thompson about the future of diesel. He says: “Hybrid is going to take sales from diesel because it will be a second alternative to gasoline. But diesel will still be a major part of the market because of its own technological advancement. There is talk within Toyota of creating a diesel hybrid engine, which Nanotechnology company Oxonica, spun out of Oxford University, is aiming to capitalise on the call for cleaner driving options. It is speaking to oil companies to roll out Envirox – an additive it has created that can, it says, be added to diesel to cut consumption by up to one-tenth, and harmful emissions by up to 15 per cent (MW last week).
Andrew Elphick, global business director for Oxonica Energy, the division of Oxonica that developed Envirox, says: “Diesel with Envirox would cost slightly more, but savings on consumption would more than mitigate that.
“If a major oil company was to adopt it, it could become available to consumers on forecourts. We have focused on diesel because that’s where we have market data, but there is no fundamental reason why the technology couldn’t be applied to gasoline.”
Fuel for thought
Although unwilling to discuss the possibility of linking up with Oxonica to create a green fuel, global oil giants are likely to take notice of such products. Shell and BP are among a group of companies that launched the Carbon Capture and Storage Association this month to encourage the development of technology to reduce the UK’s carbon emissions. Shell unveiled Pura, a petrol that “contributes to cleaner air”, in 1998, while BP hired 20:20 London earlier this year to highlight its super-unleaded petrol brand Ultimate.
As for the branding process of bringing Envirox to a consumer market, experts say that Oxonica would do well to retain naming rights. Elphick thinks it would “make sense” for an oil company to assume control of the brand name as part of its wider marketing strategy.
But FutureBrand Europe chief executive Patrick Smith says: “Petrol companies are not the greatest at inspiring deep levels of consumer trust. My advice to Oxonica is to join the market as an ingredient brand. Developing Envirox as an objective, independently supplied brand is a powerful idea.”
Honda and Toyota are not alone in readying “cleaner” vehicles for the mass market. Ford is testing both a bioethanol-powered version of the Focus with various fleet owners in the West Country, and a diesel/electric Ford Transit hybrid called the HyTrans.
A Ford spokesman admits: “The HyTrans may be rolled out, but is a long way off. It would need a lot of real-world testing.”
Of Ford of Europe chairman Lewis Booth’s gripe about the Congestion Charge exemption benefiting “technology-specific” brands, rather than all vehicles with a proven capacity to reduce emissions, the spokesman adds: “It’s not something we’re campaigning on.”
But even Ford’s rivals are sympathetic to Booth’s view. Toyota’s Hall adds: “We’d prefer a technology-neutral approach. Exemption should be on the basis of benefit to the environment, provoking advancement in technology to cut emissions.”
By contrast, the Government is replacing its defunct Powershift scheme, which provides grants to motorists who opt for “cleaner” cars, regardless of engine technology. A spokeswoman for the Energy Savings Trust, which will handle applications for grants, says: “We are awaiting European Union approval on the Low-Carbon Car Programme. Drivers will qualify for grants of up to &£1,500. The emissions level is yet to be set, but will probably be about 120g of CO2 per km.”
For their part, green groups remain unconvinced of the commitment of car and oil companies – and motorists – to cutting pollution. Environmental Transport Association director Andrew Davis says: “Consumers are interested in price. By and large they haven’t cared that much about the environment. A growing number of people are changing their views, but they haven’t been given the information in a way that can be easily digested.”
Honda’s Thompson argues that a key driver of change is a generation that can’t yet take the wheel. “Current consumers have a laissez-faire attitude, but for nine- to 18-year-olds, the environment is top of their list. They are practically insisting we tackle it.”
Even US president George Bush is pleading with motorists to “pitch in by being better conservers of energy”. It appears that the days of car companies trading on their vehicles’ power and image may be coming to a screeching halt.v