A Mazda car company logo is seen outside an automobile dealership in Nice, France, March 29, 2016.    REUTERS/Eric Gaillard

A Mazda car company logo is seen outside an automobile dealership in Nice, France, March 29, 2016. REUTERS/Eric Gaillard (Copyright Reuters 2016)

Japanese carmaker Mazda plans North American diesel debut for 2017

By Features Reuters

Mazda Motor Corp <7261.T> is gearing up to launch a diesel engine car in North America next year, five years later than planned, confident it can attract demand in a market that has been hit hard by Volkswagen's emissions-cheating scandal.

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U.S. demand for diesel vehicles suffered a setback after Volkswagen admitted in September 2015 to installing software in its cars to make them appear cleaner than they were in exhaust emission tests.

But industry experts expect sales to gradually recover beginning next year, and Mazda believes its diesel vehicles will be "embraced in the United States" just as they have been at home.

In the second half of 2017, Mazda will introduce the diesel version of its revamped CX-5 SUV crossover in the United States, as the carmaker's "clean diesel" technology remains an efficient way to help meet tougher fuel economy and emissions regulations, Masamichi Kogai, the chief executive officer of Japan's fifth-largest automaker, told reporters in Tokyo.

Diesel models accounted for about a third of Mazda cars sold in Japan and Europe in the first nine months of the year, slightly down from the same period in 2015.

While North America accounts for nearly 30 percent of the automaker's total global sales, the company has repeatedly delayed its plans to launch a diesel vehicle there.

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The initial target was for a North American debut in 2012, but Mazda has taken longer than expected to coax as much performance out of its diesel engines as possible while meeting U.S. emission standards that have become more stringent following the Volkswagen scandal, Kogai said.

LMC Automotive says 0.1 percent of cars and SUVs sold in the United States in January-September were diesel, down from 0.7 percent a year ago. This segment was dominated by Volkswagen before the emissions scandal broke in mid-September 2015.

While the auto industry consultant expects the share of diesel cars and SUVs will remain largely unchanged in 2017, it sees total U.S. diesel passenger vehicle sales, the majority of which are trucks, to increase their market share to 3.3 percent next year, from 3.1 percent in 2016.

Separately, Kogai said Mazda was planning to launch an electric vehicle in 2019, and plug-in hybrids in 2021 at the earliest, in line with stricter "zero emissions" regulations as countries step up efforts to tackle pollution.

While Kogai declined to offer details on the possible models, Mazda has been leasing on a trial basis a battery-electric version of its Demio model in Japan since 2012.

(Reporting by Naomi Tajitsu; Editing by Himani Sarkar and David Evans)