A study made by a University of Michigan researcher has found that buying vehicles with clean-diesel technology may be more expensive to buy, but can actually save owners thousands of dollars in the long haul.
Bruce Belzowski, managing director of the University of Michigan’s Transportation Research Institute’s Automotive Futures group, compared thousands of gasoline and diesel versions of the same or nearly identical vehicles sold at auction in 2012-13, including Audi, BMW, Mercedes-Benz and Volkswagen passenger cars and SUVs, and Chevrolet, Ram, Ford and GMC medium-duty pick-up trucks.
Belzowki’s study found that the total cost of ownership—including depreciation, fuel costs, repairs, maintenance, insurance, and fees and taxes—is often much less for diesel vehicles as compared to gasoline versions of the same vehicles, mostly ranging from $2,000 to $7,000 over three to five years.
“Though there are some exceptions to these positive results for some of the diesel versions of vehicles from a total cost-of-ownership perspective, the overall direction of the results support the idea that diesel vehicles are competitive within the US market,” Belzowski said. “In particular, the idea that buyers can get a return on their initial higher investment in a diesel vehicle within three years is a very positive sign, considering new buyers tend to own their vehicles for an average of three to five years.”
While most new diesel vehicles cost more than their gasoline counterparts – from a few hundred dollars to several thousands – the resale values after three years are 30 to 50 percent higher for diesel passenger cars and SUVs, and 60 to 70 percent higher for diesel medium-duty pick-up trucks. The percentages are even higher after five years of ownership.
In addition to holding their value better than gasoline-powered vehicles, diesels incur lower fuel costs—12 to 27 percent less for passenger cars and SUVs and four to 8 percent less for medium-duty pick-ups over three- and five-year periods.
Although the combined costs of insurance, repairs, maintenance and fees and taxes are higher for nearly all diesel models, the lower depreciation values and lower fuel costs of diesel vehicles contribute to a lower total cost of ownership, especially among passenger cars and SUVs.
“Diesel-powered vehicles will continue to provide significant value to their owners through their total cost-of-ownership advantage over their gasoline-powered counterparts, and they will play an increasingly important role for manufacturers as fuel economy regulations become increasingly strict,” Belzowski said.
The report “Total Cost of Ownership: A Diesel Versus Gasoline Comparison (2012-2013),” was underwritten by Robert Bosch LLC. Data was provided by Manheim Auctions, Vincentric, Black Book, Environmental Protection Agency, National Highway Traffic Safety Administration, Bureau of Labor Statistics, Energy Information Administration and the Federal Highway Administration.