Mercedes one of several automakers taking a chance on diesel

Mercedes-Benz officials are hoping that diesel-powered vehicles - such as its Mercedes GL 320 BlueTec, rated 17 mpg in the city and 23 mph on the highway -gain ground around the world.Mercedes-Benz is betting heavily on diesel-powered vehicles -- but the escalation of diesel fuel prices to about $5 a gallon nationwide could be making that bet a long shot.

Audi, BMW and Volkswagen also have diesel-powered vehicles in the works, but Mercedes-Benz, with its long history of selling diesel products and three new models hitting showrooms, has the most riding on diesel. Mercedes' second generation of "BlueTec" diesel-powered cars, unlike the first generation, will be available for sale across the country.

Mercedes officials say the all-new diesel-powered ML, R and GL class products will cost about $1,000 more than their gasoline-powered counterparts, a figure that compares favorably with the extra $3,000 and up charged for hybrid-powered cars. Final pricing won't be announced until fall.

Mercedes officials point to studies, such as one done by J.D. Power, that suggest that diesel-powered vehicles could gain ground around the world.

"Because of the diesel fuel price, a few dark clouds have appeared on the clean diesel horizon," said Thomas Ruhl, director of the R-Class, SUV Hybrid and BlueTec programs at Mercedes. "But should we really put in question our long-term powertrain strategy because of this single aspect? We say no. Because the price of fuel is just one of many parameters in a complex network."

Analysts aren't so sure, however. They say the price of diesel may force consumers to make other choices.

"When diesel prices go up, the interest in diesel, not surprisingly, goes down," said Jack Nerad, editorial director for Kelley Blue Book. "We have not seen yet any kind of groundswell of support for diesel in spite of the fact that diesel seems the simplest solution to increase fuel economy without giving up driveability. They also are cost effective. Hybrids command a much bigger premium."

Mercedes officials point out changes were made to their new line of diesel engines to make combustion as clean and efficient as possible and the use of an oxidizing catalytic converter minimizes the emissions of carbon monoxide and unburned hydrocarbons. In addition, a particulate filter cuts down soot particle emissions and "ADBlue injection" cuts down nitrogen oxides.

"Our diesel engine has no need to fear current gasoline hybrids," Mr. Ruhl said. "Comparison tests under real life conditions, such as one independent 'coast to coast' fuel consumption test against a Japanese hybrid SUV, saw our M-Class win with a consumption advantage of 11 percent."

He also pointed to a test by Edmunds.com that took place in April of the Mercedes GL 320 CDI diesel model and a Chevrolet Tahoe Hybrid. The results showed that the GL got 23.9 miles per gallon to the Tahoe's 20.9.

The upcoming ML 320 BlueTec is rated at 18 mpg in the city and 24 on the highway, the GL 320 BlueTec is rated at 17/23 and the R 320 BlueTec is rated at 18/24.

The three new Mercedes models proved to be quiet in day long road tests. There were no traces of the clattering, noise and smells that some people associate with diesels.

While diesel-powered vehicles have overcome the drawbacks of the past, it remains to be seen if they can overcome consumer concerns about high fuel prices in the future.