Diesel engine skids from favor with new-car buyers

When the 1984 Continental and Continental Mark VII bow in the fall, one of the engine options will be a new 2.4-liter, in-line ''6'' diesel from BMW-Steyr. Ford Motor Company also will offer a 2-liter, 4-cylinder diesel in the Ford Tempo/Mercury Topaz as well as the Escort/Lynx.

But that's about the only good news for the automotive diesel buff these days.

The diesel-engine automobile is out of favor, not only with the average car buyer, but with the fleet buyer as well, according to a report by Runzheimer & Co.

Returning for the third consecutive year to a sample group of business car fleets, all of which have some diesels, Runzheimer researchers found that not one fleet manager will buy more diesels in 1983, a massive drop from 62 percent two years ago. In addition, 31 percent are dropping their diesels before the regularly scheduled time of replacement is up.

Why? The company reports that 69 percent of the fleet executives do not consider diesels to be cost-effective fleet vehicles while 85 percent reported significant maintenance problems with diesels which they did not encounter with gasoline-fueled cars.

The consumer demand for diesel cars is so low these days, in fact, that Chrysler Corporation, which was to have introduced a new 1.9-liter Peugeot diesel in 1984 for the Dodge Omni and Plymouth Horizon, has thrown its plans onto the back shelf.

''Chrysler's diesel program is on hold,'' asserts Lee A. Iacocca, Chrysler chairman. If conditions change, the program will be put back in gear.

Indeed, over the past few years the diesel engine has been up and down like a yo-yo. When gasoline prices rise, the diesel engine looks good because of its generally higher mileage, durability, and not-so-bad performance when linked up to a turbocharger.

But when gasoline supplies are plentiful and prices drop, as they did all through 1982 and are continuing to do so in 1983, diesel-car sales take a spin. In some parts of the US, diesel fuel prices are even higher than regular-unleaded prices.

A diesel-engine automobile costs much more than a comparable gasoline-engine car, it can be noisy, and it isn't as easy to start in cold weather as a gasoline-fueled car. Too, GM's massive problems with its converted-gasoline-engine diesels has hurt the market demand and large numbers of car buyers won't look at a diesel, no matter who builds it.

At the same time, the diesel engine may be off the hook, at least in the near term, so far as tailpipe emissions are concerned.

The Environmental Protection Agency is expected to extend the particulate emission standard of 0.6 gram per mile through the 1986-model year. As the rule now stands, it would have dropped to 0.2 gram per mile with the 1985-model cars in 18 months and 0.26 for lightweight trucks which carmakers have long protested they could not meet without more time.

At one point GM had been looking for a diesel penetration of as much as 15 percent of the entire automotive market, but its plans could be thwarted. Ford Motor Company has been far less bullish on the prospects.

The diesel is especially important to GM because without it, the big corporation could have a hard time selling its larger-size cars and, at the same time, meet the toughening fuel-economy requirements of the law. The corporate average fuel economy (CAFE) for 1983-model cars is 26 miles per gallon. GM already has said it will be unable to meet the figure in 1983 and thus will have to draw down some of the plus-mileage it has accumulated from past years in order to avoid a gas-guzzler tax.

So if diesel demand doesn't pick up in the years ahead, the situation can only worsen for the big automaker.

European motorists were much more buoyant over the diesel last year than US drivers. Helped by the super-high cost of gasoline in Europe, last year diesel engines accounted for 8 percent of the entire car market. In Belgium diesels took 16.8 percent of the market, 14.4 percent in Italy, 13.8 percent in West Germany, and 11.7 percent in France. Only in Britain has the diesel lagged in the breakdown lane with 0.6 percent of total car sales.

Last year General Motors sold 174,000 diesel-engine cars, down sharply from 1981, but the entire diesel market was off. GM diesel-car sales, in fact, were off a devastating 37.6 percent in 1982 compared with 1981. In 1981, domestic and foreign carmakers sold more than 510,000 diesel-engine cars in the United States. Last year the number fell to 318,648.

In the US diesel sales last year were about 4 percent of the car market, down from 6 percent the year before. US diesel sales peaked at 7.7 percent of all automobile sales in December 1981.Last year General Motors sold 174,000 diesel-engine cars, down sharply from 1981, but the entire diesel market was off. Diesel-car sales, in fact, were off a devastating 37.6 percent in 1982 compared with 1981. In 1981, domestic and foreign carmakers sold more than 510, 000 diesel-engine cars in the United States. Last year the number fell to 318, 648.

In 1982 Volkswagen diesel-car sales in the US were off a blistering 60 percent from the year before. Indicating the severe blow to VW in the United States, Rabbit diesel sales sank from almost 100,000 in 1981 to under 38,000 last year.

Even so, nearly 80 percent of all Mercedes-Benz cars sold in the US are diesels, with all but the 240D turbocharged. And when its 240-model replacement vehicle, the 220, arrives in the fall, the so-called ''baby Benz'' will offer both a gasoline engine as well as a diesel.

Peugeot is predicting about 45 percent diesel cars for 1983. Last year, out of 14,044 cars sold in the US, 67.5 percent were diesel. In 1981, by contrast, the French carmaker says diesels accounted for 85.7 percent.

Meanwhile, a long-range market for the diesel engine may still exist. The need for fuel conservation continues, not only in the US but the entire world.

Auto manufacturers are pursuing the direct-injection diesel because of the 15 to 20 percent rise in fuel economy it provides over the present automotive diesel engine.

Diesel engines are far more quiet than they were a few years ago. Also, diesel engineers can be expected someday to reduce the specific diesel odor which is offensive to many people.

Ford says its idea is to ultimately offer its buyers a gasoline engine/diesel option all across its line, starting with the Continental and Continental Mark VII as well as the Escort/Lynx in 1984.

The Ford-BMW tieup was a quicker, cheaper way for the US carmaker to get a viable, well-researched diesel engine than it could have done by itself.

How big is the BMW commitment to the diesel? The Munich-based company will, according to chairman Eberhard von Kuenheim, plan equally for both gasoline and diesel engines.

Besides Ford, BMW also is holding talks with other carmakers on its diesel engine, but probably could not meet any further demand, beyond Ford, till after 1985.

Of course, as things sort out, it may not have to.