Could Diesels vanish from Renault?
Following the Volkswagen scandal last year where VW admitted to engineering software to cheat U.S. diesel emissions, the tighter emissions standards may cause diesel engines to disappear from most of Renault’s cars.
The repercussions of VW cheating the system have forced other car manufactures to reconsider their long term plan.
Both Renault and Peugeot were heavily invested in diesel technology since before the VW scandal but now they are looking at changing the future of diesel cars. In July Thierry Bollore, Renault’s Chief Competitiveness Officer said that the diesel investment had dimmed significantly.
Diesel engines are much more expensive to engineer and build than petrol engines and Renault has already removed diesel engines from its smaller cars such as the Renault Twingo because the extra cost of the diesel engine does not outweigh the savings on fuel.
With the Euro 7 emissions coming out in 2020, Renault predicts that the tough emission levels will mean the end of diesel engines in their ‘B-size’ and some ‘C-sized’ vehicles such as the Megane hatchback.
Classes A, B and C account for more than 60 percent of the companies European deliveries with most of those being diesel.
The Volkswagen scandal not only bought to light the German car manufacturers cheat software but also highlighted the difference in nitrogen oxide (NOx) emissions between regulatory tests and actual on road emissions. Nitrogen oxide gases are linked to acid rain and respiratory illnesses and blamed for thousands of deaths each year. More than five times NOx is released during everyday road driving compared to the tests taken in factories to pass the cars.
To try and prevent the sparse difference, in 2019 car emissions will be based on real driving. This will force car manufacturers to install much more costly equipment to lower the emissions further.
Diesel engines will also become less appealing with the increase in popularity of hybrid vehicles. As diesel designing becomes more and more expensive, the car batteries needed in electric and hybrid vehicles is decreasing in price making it a much more desirable long term investment.
AlixPartners, an auto industry management consultant believe that diesel cars will drop to just 9% of European car sales by 2030 with the decline accelerating after 2020.
Renault isn’t the only car manufacturer expressing concerns over the future of diesel engines. Chief Executive of Volkswagen, Matthias Mueller is questioning “whether it still makes sense to invest a lot of money in further developing diesel” with the scandal costing the company billions with $15billion of U.S. fines already agreed.
So with increasing restriction on emissions and the engineering costs rising, could we see the end of diesel cars for Renault in the near future? We shall have to wait and see.