Despite pricey fuel, Jetta diesel in demand

(Credit: Automotive News)

Volkswagen dealers say the high price of diesel fuel isn't stopping a rush of buyers eager to snatch up the first batch of Jetta TDI cars.

The TDI models--with new diesels that meet emissions standards in all 50 states--don't go on sale until late August. But many dealers say they already have enough orders to eat up their 2008 allocation of the new Jetta sedan and Sportwagen TDI.

With diesel approaching $5 a gallon in some states, what's the appeal? Dealers say it's the improved fuel economy and high reliability of the diesel engine--plus the kind of performance you can't get from a hybrid or fuel-efficient small car.

"People are becoming aware of what constitutes a true economy vehicle," says Richard Fisher, owner of Auto Barn VW, which has three Chicago area VW stores. "They don't just want economy but a car that drives well and handles well and has good performance."

Volkswagen of America plans to sell 15,000 TDI Jettas this year. Next year, the TDI could account for up to 30 percent of Jetta sales, says VWoA spokesman Steve Keyes. That would take volume above 30,000 units.

The price is right

Dealers say buyers also are rushing in to place orders because the Jettas were priced right. The diesel sedan starts at $22,640 including shipping and the station wagon at $24,240--a premium of about $2,000 over a similarly equipped model with a gasoline engine.

They will be the first VWs with standard electronic stability control, now a $450 option, and free scheduled maintenance. Both are being phased in through VW's 2009 model year range.

The Jettas are the only 2009-model volume passenger cars that will be offered with the 50-state diesel engines. On the luxury side, BMW will launch a diesel 3 series this fall. All the other new diesels that have been announced will debut in SUVs and crossovers. Japanese clean diesels won't debut for about two years.

The diesels are hot even in Texas, where pickups rule.

"Demand is strong because of the price," says Eddie Lee, owner of Lewisville Volkswagen in Lewisville, Texas, a suburb of Dallas. "We are in a heavy commuter market, and the mileage offsets the price of diesel."

Lee says many TDI orders are from repeat diesel buyers who rave about the durability of the VW diesel engine. "The TDI cars last so long, and this is a vehicle that will go 200,000 to 300,000 miles," he says.

Better mpg

VW will promote the TDI's fuel economy, which it estimates is 33 percent to 35 percent better than that of a gasoline-powered Jetta. The EPA has rated the Jetta sedan TDI at 29 mpg city and 40 highway, according to VW.

The company is also studying whether to bring in other diesel vehicles, including a Tiguan SUV. Dealers say they've been clamoring for the diesel Tiguan for months, especially because sales of the new compact SUV haven't been as hot as they had hoped.

Dealers aren't optimistic they'll get one in this generation, says Gene Langan, owner of Langan VW, which has two stores outside Hartford, Conn., and will open a third on Aug. 1. But, he adds: "VW is looking at diesels right across the board."

(Source: Automotive News)