After many fits and starts, diesel cars are gaining traction in the US market, fuelled largely by German carmakers including Volkswagen, which opened a plant last May in Tennessee.
Diesel auto sales in the US revved higher this year thanks to some temporary factors, including a shortage of hybrid cars because of disruptions from the Japanese earthquake disaster.
Because European regulations emphasise carbon emissions over other pollutants, some diesel models in Europe, notably made by General Motors and Ford, cannot be easily adapted for the US.
Baum said he sees pressure to harmonise US and European standards in a way that allows more of the European diesel engines to be used in the American market.
“If this is done I would expect to see significant increases in diesel because GM and Ford have strong diesel programmes in Europe,” he said.
US consumers bought an estimated 9,000 diesel cars in May, up 34 per cent from a year earlier, according to the research firm Baum & Associates.
Some analysts say the long-term view is getting better as well for diesel, whose image has been tarnished by concerns about smelly cars and poor availability of diesel fuel outside the truck sector.
Diesels have been available in the US for decades, but the market pales compared to Europe where they make up around half the auto fleet.
Alan Baum of Baum & Associates said that outside the large pickup truck segment, around one percent of US cars are diesels, and that total diesel market share is expected to be around 4.5 per cent this year.
By 2015, Mr Baum expects diesel to grow to between six and 6.5 per cent, “with all of the growth in the smaller vehicles, meaning the one per cent will grow to 2.5 or three per cent.”
The research firm JD Power & Associates sees the US diesel market share at 3.1 per cent in 2011, and growing steadily to 7.4 per cent by 2017.
German carmaker Volkswagen is betting on diesel gaining in the US with its new plant opened in May in Tennessee, where around one in four cars produced is a diesel.
The Mexican-made VW Jetta compact is the biggest-selling US diesel car with around 5,000 sold in May, according to Mr Baum.
Other diesels are sold by Mercedes and BMW, along with a handful of large trucks from US makers.
Although efforts to introduce more diesels have sputtered in the past, some things are different now, said Allen Schaeffer, executive director of the Diesel Technology Forum, a nonprofit group backed by industry.
“For those seeing the products, we are seeing a very strong take rate for diesel cars,” he said.
Mr Schaeffer said diesels can now meet US emissions standards, even in states like California with more stringent regulations, thanks to technology improvement and new low-sulfur diesel fuel. In past years, some diesels could not be sold in California and a few other states.
One factor holding back diesel car sales is the cost of fuel. While it had been cheaper than gasoline in the past, it is now more costly, due to higher federal and state taxes and a smaller market for refiners.
Mr Schaeffer said the cost differential is bad energy policy and discourages diesel car sales.
“In no case should we tax a more energy-efficient fuel in a way that creates a disincentive,” he said.
With diesel cars around 10 per cent more expensive than comparable gasoline cars, there is “some reluctance by automakers” on introducing new models.
Still, one expects a 40 per cent jump in US diesel sales this year, albeit from a very low base. But it remains unclear whether automakers will push diesels or look at more advanced technologies like fuel cells.
Mr Baum said growth in diesel will depend on a number of variables including overall fuel costs, taxes and emissions standards.