Volkswagen UK is predicting that diesel car sales will take 27% of the UK market by 2004, writes deputy editor Graeme Roberts.

Diesels’ share of the October new car market was 26.7% and the company cites other UK research that forecasts a 30-35% share for diesels by 2005 and a massive 50% by 2008.

Spokesmen showing off a variety of new VW petrol and diesel engines at a ride and drive day for journalists on Wednesday, said new UK CO2 output-based company car tax scales and the fuel economy advantages had certainly helped push diesel car sales – for a given size and power output, diesels emit less CO2 and are about a third to half more economical.

But they stressed that the “technology improvements” of recent years had also done a great deal to improve diesels’ appeal, especially amongst private buyers who don’t pay company car tax.

“Recent positive media coverage has affected private buyers,” said VW’s Mike Orford. “Readers of the likes of What Car [a monthly buyers’ guide magazine] more and more are being told that ‘the diesel’s the best’ in reviews and tests of new model ranges.”

Orford said that the 130bhp ‘PD’ turbodiesel was the best selling engine in the popular Golf hatchback line, taking about 15% of sales in a range where diesels now account for about 65% of sales.

In the larger Passat, another popular company car line, diesels take 75-80%, encouraging VW UK to add a 130PS turbodiesel sedan with 4Motion all-wheel-drive and six-speed manual gearbox to have, as one spokesman put it, “a crack at Subaru”, whose petrol-powered 4WD saloons and estate cars are popular with UK farmers and country dwellers.

Diesels’ proportion of sales in the smaller Lupo and Polo lines is lower, as these sell primarily to private buyers, but VW is quick to point out that the flagship Polo model has a 100PS, 1.9-litre turbodiesel engine.

A 2000-unit limited edition ‘25th anniversary’ Golf GTi is perhaps the best indication of the success of diesel models for VW UK.

The importer that once shunned bringing in the original ‘GTD’ model launched several generations back, when UK diesel sales were in the doldrums, has, in 2002, had the German factory build a special 150PS PD turbodiesel version of the anniversary GTI as an alternative to the 180PS petrol turbo model. Take-up is about 50-50 petrol/diesel, something that would have been unheard of in the ‘hot hatch’ market a decade, or even five years ago.

Diesel engines also look set to dominate sales of the Touareg luxury SUV, due on sale in the UK next summer. Engine offerings include a massive V10 turbodiesel, for which VW UK has already had to revise sales targets upwards.

“Sales of this model are engineering-driven and we will sell a lot more diesels than we first thought,” Orford said, adding that the SUV will also eventually be offered with a new in-line, five-cylinder turbodiesel, effectively “half a V10”.

Despite its diesel success, VW UK is not neglecting its petrol engine line. A new 180PS turbo has found its way into various ‘sports’ Golf and Bora models, the entry-level Passat has a new 20-valve two-litre four in place of the previous eight-valver and, perhaps most significant, direct injection units are filtering in, starting with a 1.4-litre ‘FSi’ Polo.

In next year’s Touran minivan, based on the platform of the next generation Golf, all three petrol engines will be FSI units, coupled to six-speed manual or automatic gearboxes, and all Passats will also have FSI engines by the end of 2003. FSI should be range-wide within three years.

As well as challenging the likes of the Range Rover with the new Toureg SUV, VW UK is also contesting the luxury car sector next year with the new Phaeton.
By now well practised at deflecting the “who’s going to buy a luxury VW if it’s still called a VW?” jibes, the VW UK insiders make it clear they have no unfounded dreams of knocking the Mercedes-Benz S-class off its perch.

“I hate to lapse into marketing-speak,” said Orford, “but our approach will be an attempt to lure so-called ‘free thinkers’ away from brands like Saab and Lexus. We’ve clearly got the engineering in the car – the cluster of rival brands’ engineers closely inspecting the car at its motor show launch was proof of that – so we’ve got to get potential buyers into the showroom and demonstrate that the Phaeton is not a half-hearted effort.

“It’s a properly developed car, not just a stretched platform with some wood and leather on top.”