Toyota to drop diesel cars this year in Europe

Bloomberg

Toyota Motor Corp. announced plans to drop diesel models from its European portfolio this year even as Volkswagen, which sparked the fury over the technology, predicts a rebound.
The diverging views of the world’s two largest automakers reflects the uncertainty over the future of diesel, which has faced a steady drumbeat of bad news since Volkswagen’s cheating scandal erupted in September 2015. The German auto giant is expecting consumers to forgive and forget soon, as cleaner diesels hit the streets.
“Diesel will see a renaissance in the not-too-distant future because people who drove diesels will realise that it was a very comfortable drive concept,” Chief Executive Officer Matthias Mueller said at the Geneva International Motor Show. “Once the knowledge that diesels are eco-friendly firms up in people’s minds, then for me there’s no reason not to buy one.”
The comments are bold considering Volkswagen put aside about $30 billion in provisions to cover fines, retrofits and legal costs stemming from rigging diesel-emissions systems to dupe government pollution tests.
The fallout has been wide ranging. Germany is now considering potential bans of diesel vehicles from cities, and governments including China, France and the UK have put in place plans to phase out the internal combustion engine. Consumers have also begun to shun diesel, with its share of German car sales tumbling to a third from half since VW’s cheating scandal.
In contrast to VW’s upbeat prognosis, Toyota is getting rid of diesels in Europe, the main market for the technology. After refraining from a diesel variant of the C-HR crossover in
2016, Toyota will extend that decision across its portfolio, including offering the redesigned Auris compact with two hybrid powertrains and one turbocharged gasoline engine.
There’s more at stake than consumer choice. European carmakers have been counting on diesel—a profitable and fuel-efficient alternative to gasoline vehicles—to meet tighter environmental regulations until electric cars become more viable.
“We need diesel to get to the CO2 goals,” Herbert Diess, who heads Volkswagen’s namesake mass-market brand, said after presenting the all-electric I.D. Vizzion concept car that’s capable of driving as far as 650 kilometres on a single charge. Toyota, a pioneer in hybrid technology, has had doubts about diesel’s ability to meet modern environmental rules since 2011, Didier Leroy, executive vice president at Toyota, said in Geneva. Now, there’s a risk to consumer sentiment, with a “real potential” for driving bans to hit diesel cars in European cities beyond Germany, he said.