November 13, 2013
Bill Howard

Gas vs. diesel vs. hybrid: Which car engine is best for you and the environment?

Gas, diesel, hybrid, or electric? Everyone wants their next car to have better fuel economy and wouldn’t mind if it’s better for the environment. But which engine is the right choice? Ultimately, it depends on the kind of driving you do and how much distance you’ll travel before turning the car over to the next owner. This auto tech backgrounder will help you decide which engine is best, given your circumstances.

Here’s the broad answer: Go with gasoline if you’re a low-mileage driver, hybrid for city driving, and diesel for high-mileage (mostly highway) driving.

The mainstream gasoline engine is best if you drive less than 7500 miles a year because the savings on fuel won’t match the premium you’re likely to pay for a hybrid or diesel car. Hybrid is the winner if you cover a lot of miles in stop and go city driving or on clogged expressways, where braking recharges the battery that powers the electric motor. It helps if you’re easy on the throttle and brake early and smoothly in a hybrid.

If you drive a lot of highway miles, diesel cars — like the 2014 Chevy Cruze diesel — are right choice for cost per mile driven, and most diesel vehicles have higher trade-in values than gasoline-powered cars. The case for diesel is clearer in the premium/sporty segment where the gasoline engine uses premium fuel, so the diesel price disadvantage per gallon of fuel is less than 10%.

To draw the conclusions above, you need to think about a half-dozen factors and how your driving fits in. Higher miles-per-gallon is just part of the picture. The more miles you drive, the sooner you get payback. The residual value of your ride may tip the scales.

2014 Chevrolet Cruze Clean Turbo Diesel

Diesel or hybrid price premium

Start your gas-hybrid-diesel calculations with the price premium for a hybrid or diesel car over the most similar gasoline car. It ranges from nothing on Lincoln hybrids to $5000 on pickup trucks with heavy duty diesels. A $2000 diesel or hybrid premium is a good starting point for your comparison. If a diesel car has 200,000 miles of life in it (that kind of lifespan is easy for a diesel), that’s a penny a mile you have to recapture.

You have to decide whether the proper comparison is the gasoline car with the closest 0-60 mph acceleration or best fuel economy, which will probably be the entry-level gasoline car with the smallest engine and lower price; or the car with the same level of amenities. Finding an apples to apples comparison is tricky. For example, a hybrid more often comes standard with navigation worth $500-$1500 on the sticker price because the automaker wants to provide a center stack color LCD display to show of all the efficiency-monitoring graphics, and the cost puts you halfway toward that of a navigation system.

The price premium for an electric vehicle is significant. The best is the Chevrolet Spark EV at about $5000 more than the comparably equipped than the gasoline Spark.

Residual value may be better with diesels, hybrids.

A diesel vehicle will be worth more than the average vehicle at trade-in time. A hybrid should at least match the residual value of the gas engine car. For EVs, which sell in smaller numbers, the residual value may depend on each model’s reputation and on the length of the battery warranty; the battery is often half the value of the vehicle.

2014 Ford Fusion HybridThe average vehicle retains 38.2% of its value after five years (37.2% cars, 39.8% light trucks), according to kbb.com, measured as a percentage of the list (sticker) price.  The 2013 Ford Fusion does the best job retaining value among hybrids at 45% after five years, but that’s still outside the top 10 gas engine vehicles. Fifteen years of hybrid sales in the US shows little evidence the $2,500 batteries wear out but rapid improvements in hybrid technology mean a used hybrid feels more geriatric that a gasoline car. The best EV for residual value, kbb.com says, is the Chevrolet Volt (really more of an extended-range hybrid), retaining 30.0% of its value at five years.

For many hybrid cars where the model has a gasoline counterpart (Ford Fusion, Honda Civic, Hyundai Sonata, Nissan Altima), the residual value of the two cars are often the same or within 1-2 percentage points of each other.

Nine of 10 diesel cars and trucks studied by the University of Michigan had better five-year residual value than their gas-engine counterparts and half were at least 10 percentage points better, led by the Mercedes-Benz GL with a 39% residual value advantage over the gas GL. It is also our favorite full-size SUV. What’s more, with the GL, the diesel version is the cheapest GL model.

If you lease rather than buy, you should get a lower lease payment with diesel than gas. A car lease is a loan of 24 to 60 months on the difference between the price new and the value used (that and the “acquisition fees” auto dealers love). A lease on a high-residual-value diesel lets you buy more car for the same monthly payment, give or take the diesel premium. But if you buy, you’re financing, say, a $32,000 vehicle rather than $30,000 (the average new car cost). You’ll get most of it back a couple years down the road.

Next page: Fuel cost beyond miles per gallon…

Fuel costs for gas, diesel, hybrid: Think beyond mpg

The cost of fuel and fuel economy are often where people start and stop thinking about which engine type is best. It helps if you think about fuel cost per year, or dollars per 100 miles driven, rather than miles per gallon because some of diesel’s efficiency is lost to the higher price of fuel. Also, you should decide how much you want to rely on government fuel economy ratings. “Your mileage may vary” is a common footnote, and for good reason: it really does.

Does your driving match the EPA average? The mpg ratings posted at  assume you drive 55% city miles, 45% highway miles. Most people don’t know, or overestimate highway miles because they better remember the long trips. It’s likely if you drive a diesel you know you’re driving more highway miles. At 60 mpg, a diesel engine vehicle kicks butt on mpg. There is no one smugger than the owner of an Audi A8 announcing to country club bar crowd that he got 40 mpg and 750 miles driving range on his last trip. (After he fronted $75K to buy the car.)

My experience is that gas-engine cars come close to the EPA ratings. Every diesel engine car I’ve driven does better on highway mileage than the EPA highway rating, and that’s usually without trying. Most recently, I got 50 mpg highway in a just-manufactured, not-broken-in Chevrolet Cruze diesel (EPA highway rating 46 mpg), just over 50 mpg in a BMW 328d (EPA highway rating 43 mpg), and 38 mpg mostly highway driving in an Audi A8L TDI diesel (EPA highway rating 34 mpg). In general, I found hybrids when I drove them to get a bit less than the EPA ratings and they also seemed more affected by driver behavior.

2014 Chevrolet Cruze diesel

If you want to create a spreadsheet to compare possibilities, use a formula like this:

miles / (city mpg * % city driving + highway mpg * % highway) * $/gallon = cost per year

Divide miles driven by the average mpg you expect. Use the formula in parentheses if you can break out city and highway mileage). That’s how many gallons of fuel you use. Multiple by the cost per gallon for fuel. That’s your cost of fuel for the period you’re measuring.

Quicker diesel savings with high-end cars

Payback with a diesel comes quicker if it’s a premium vehicle. The gasoline equivalent of an Audi, BMW, Mercedes-Benz or Porsche diesel uses premium gasoline. So there’s less of a diesel-fuel price premium. As of mid-fall 2013, fuel prices are:

Regular gas, $3.265 per gallon (average of all US regions)
Premium gas, $3.564 per gallon, $0.299 or 9.2% more per gallon
Ultra-low sulfur diesel, $3.857, $0.293 or 8.2% more per gallon than premium; $0.592 or 18.1% more per gallon.

If a gas engine car gets 30 mpg on regular gasoline, to match cost per mile, a diesel engine car would have to return 35.4 mpg. To match a premium-gas car, the diesel would have to get 32.5 mpg. Diesels are rated 15% to 40% more efficient than gas engine cars, so the diesel vs. premium comparison is a slam dunk for diesel; diesel vs. regular is likely but less clear until you factor in residuals.

2011 Honda CR-Z Engine

Twenty-five years ago, diesel fuel cost about the same as regular. Some of the current 60-cents-a-gallon premium can be explained by the federal mandate for ultra-sulfur diesel that was phased in from 2006-2010 and added an estimated 10 cents a gallon over low-sulfur diesel. Back when diesel cost less than gasoline, the government set fuel taxes 24.4 cents a gallon for diesel and 18.4 cents for gasoline. Supply and demand make up the difference. Demand for diesel fuel in the US grew in the last decade while the demand for gasoline fell. Refineries are optimized to produce a nearly fixed ratio of fuels. In the US it’s on the order of 25-30% “distillate” (diesel, kerosene, home heating oil, all similar in composition), 40-50% gasoline, and the remainder other refined products. Changing the ratio involves billions in upgrades.

Energy costs for EVs are a huge selling point. Most get around 100 MPGe. That is, the cost of electricity to take the EV 100 miles is about the same as buying gasoline for a combustions-engine car that gets 100 mpg.

Next page: How each engine works…

How the engines work

The most common car power plant is the gasoline engine, also called a petrol engine or Otto engine (after the German inventor). The engine sucks in 14 to 15 parts air to one part gasoline, compresses it as the piston moves up in the cylinder, and at the top of the travel when the mixture is a tenth its original volume, the spark plug ignites the fuel-air mixture. The expanding gases force the piston down, creating power.

What was a moderately efficient process improved with fuel injection replacing carburetion, higher compression ratios (10:1), intake and exhaust valve opening adjusted to rpm and engine load (variable valve timing), and gasoline direct injection (GDI) where the fuel is squirted directly into the cylinder just before ignition, rather than injected into the intake manifolds. Turbocharging uses the force of the engine’s exhaust gases to spin an impeller which rams more air and fuel into the engine, increasing horsepower by 20%-50%. It’s like adding two more cylinders to the engine on demand, without the extra weight. The additives in premium gasoline allow for higher compression ratios and more horsepower but doesn’t directly improve fuel economy.

gm turbodiesel

With a diesel engine (Rudolf Diesel, another German of the 1800s, lent his name) the air is compressed more than 20:1, raising the temperature in the cylinder to more than 1000 degrees F, then the diesel fuel is sprayed into the cylinder and is ignited by the heat. Most diesel cars and trucks have turbochargers. Diesel fuel is formulated so it ignites without the need of a spark plug. The Mazda Skyactiv-D diesel uses lower compression ratio (14:1) and other modifications to reduce emissions, lower engine cost (less reinforcement needed at 14:1), and still retain power.

A hybrid engine has both a smallish gasoline engine and an electric motor with a large battery. If the car is a strong hybrid, the electric motor can power the car by itself for a mile or two; with a mild hybrid, the electric motor only spins when the gasoline engine is running. Buyers tend to prefer strong hybrids such as the Toyota Prius over mild hybrids (GM eAssist hybrids such as the Chevrolet Malibu Eco or Hondas) because the ability to drive a mile or two on electricity is compelling and because in the past strong hybrids got better mileage.

Some hybrids use Atkinson cycle gasoline engines that make the power (downward) stroke seemingly longer than the compression (upward) stroke by not closing the cylinder’s intake valve until the compression stroke is under way. If this sounds complicated, all it means is that the engine gets to more fully burn the fuel-air mixture.

A plug-in hybrid such as the Chevrolet Volt has a much bigger storage battery and can run 30-40 miles on battery before invoking the small gasoline combustion engine. Its residual value is comparatively low, around 30% at five years, so this is not a car you buy with lowest cost in mind.

Next page: The engine break-even points…

How long before you break even?

Here are some common driving scenarios to help you figure out if you’ll break even.

Small car: 15,000 miles per year, 30 mpg gas, 40-50 mpg diesel

A typical car is driven 15,000 miles a year. A typical small car would average 30 mpg combined city and highway. The gas engine car burns 500 gallons of regular gasoline ($1633) while the diesel burns 375 gallons of fuel ($1446) and saves $186. But suppose the diesel improves on the EPA rating by another 10 mpg (5 mpg is likely, 10 mpg is possible), it would burn 300 gallons ($1157) and save $475 a year. This scenario would be close to that of the Chevrolet Cruze or VW Golf, gas vs. diesel.

Premium compact car: 15,000 miles, 30 mpg gas, 40-45 mpg diesel

Swap a premium-fuel gasoline engine into the mix, say a car like the BMW 3 Series (27 mpg EPA combined for the gasoline 320i, 37 mpg combined for the 328d). Gas-engine consumption would remain at 500 gallons but costs would be $1782 for the year because premium runs 30 cents a gallon extra. At 40 mpg on diesel, burning 375 gallons would save $336 vs. gasoline, twice as much as in the first example with the car burning regular. A diesel car rated by the EPA at 40 mpg combined might get 45 mpg real world, burn 333 gallons, cost $1286 in diesel in a year, and save $496 vs. the premium-gasoline engine. In four years, you’ve made back the $2000 diesel premium.

2010 Ford Fusion Hybrid

Medium-large SUV: 20,000 miles, 20 mpg gas, 25-30 mpg diesel

Sports parents who carpool to practice and in summer drive not fly on vacation could travel 20K miles a year. They’ll burn 1000 gallons of gasoline, $3265 (regular) or $3564 (premium). If the same SUV gets the EPA rated 25 mpg on diesel, they’ll use 800 gallons of fuel and spend $3086, a savings of $179 (vs. regular) or $478 (vs. premium). But if they get 30 mpg diesel, consumption drops to 667 gallons and savings increase to $694 or $993. The more you drive, the more you save.

Small car: 7500 miles per year, 30 mpg gas, 40-50 mpg hybrid or diesel

A small car that doesn’t get used a lot has a harder time making back a hybrid or diesel premium. A hybrid more often uses regular gasoline. At 30 mpg, a gas engine car burns only 250 gallons of regular gas, or $816. A 40 mpg hybrid or diesel would burn just 188 gallons, or $612 (regular fuel hybrid) to $723 (diesel), with savings of $93-$204. Not much. Raise the hybrid/diesel mpg to 50 combined (again, possible), consumption for the year drops to 150 gallons, and the savings increase, to $238-$327. Your savings come down to a cup of Starbucks once a week, and payback of a $2000 diesel/hybrid premium would be 6-21 years.

You can create your own scenarios with mpg differentials and different premiums for diesel or hybrid over gasoline. Most of them will continue to show it’s hard to make back the premium just be driving a lot of miles for three or four years. But as the University of Michigan study (funded by Bosch, which is big in the diesel arena) shows, the higher residual values take care of the upfront premium, especially for diesel vehicles.

Regarding diesel vehicles, the study concluded that total cost of ownership (TCO) for diesel “is less than that of the gas versions of the same vehicles.” The study adds, “Most of the savings are in the $2000 to $6000 range” for 3-5 years of ownership, with outliers ranger from less than $100 saved to more than $15,000 saved. The standout was the Mercedes-Benz GL, which starts at $63,000 (the diesel model is the cheapest Benz) and surpasses $80,000 nicely equipped.

Next page: Buying advice and who sells what…

Engine type buying advice

If you want to save money overall on your next car, give consideration to alternative fuel vehicles. The Toyota Prius hybrid has become a mainstream vehicle. While there is more complexity in a hybrid, there’s little evidence that the hybrid battery is problematic. The $2500 battery will likely last the life of the car. As battery packs get smaller, you lose less trunk space to the NiMH and now LiIon batteries.

Diesels are more likely to carry a premium at purchase and have a higher residual value at sale time. In most cases, the fuel efficiency of the diesel provides an additional savings; it doesn’t have to earn back the higher purchase price (the residual value takes care of that). The smoke, smell, and low-speed clatter are virtually gone. What little remains is noticed by pedestrians but not by occupants. Most diesels need a urea based additive (no urea-sourcing jokes, please) to clean up the diesel exhaust: 2-5 gallons for AdBlue diesel exhaust fluid at $5 a gallon every 7500 miles.

dieselhandleConsider intangibles, too. Hybrids lose some trunk space to batteries and fold-down seats with a full pass-through remain uncommon. Hybrids no longer afford HOV access (a driver-only vehicle allowed in the high occupancy vehicle line of freeways); EVs currently do. Diesel fanatics argue their vehicles should get HOV stickers but it’s not going to happen. Diesel cars are capable of 500-800 miles between fillups, which is good, because diesel fuel smells and the pump handles are filthy. If you’ve seen the Audi ad with a woman filling her normallooking sedan with clean diesel (“Hey, Lady, stop! That’s diesel”), you’re watching a a fiction: No diesel gas pump is that spotless. You’d find a chatty Victoria’s Secret model next to you on the JFK-LAX nonstop sooner than you’d find a clean clean-diesel pump.

If it’s total cost of ownership savings you want, compare more than just the gas, diesel and hybrid versions of the same car. Sometimes a competing brand with just a gas-engine vehicle will have a lower price and higher mpg rating, enough to make it competitive against the first brand’s hybrid or diesel. The other way to save money is to see if you can live with a vehicle one size smaller: go from a Chevrolet Suburban down to Chevrolet Traverse, Honda Accord down to the Civic, Toyota Avalon down to the Camry.

mb bluetec gl

Who sells what

If you are interested in diesels, there are two dozen models on the market as of late 2013.

  • Audi: A6, A7, A8L, Q5 and Q7.
  • BMW: 3 Series, 5 Series, X5.
  • Chevrolet Cruze
  • Jeep Grand Cherokee
  • Mazda Mazda6.
  • Mercedes-Benz: GLK, ML, GL SUVs, E-class.
  • Porsche: Cayenne SUV. Ram 1500.
  • Volkswagen: Beetle, Golf, Jetta, Passat, Touareg SUV.

There are other heavy duty diesel pickups that are mostly commercial vehicles (Chevrolet Silverado 2500HD, Ford Super Duty, Ram HD) and too big for most family driving. Look for Audi A4 and BMW 7 Series diesels in 2014 and several light-truck diesel pickups in 2015 from Nissan and Toyota.

There are even more hybrids, although Toyota and Lexus alone control more than half the market. In 2013, 400,000 of the 12 million vehicles sold in the US were hybrids (3%). They include:

  • Acura ILX
  • BMW: 3 Series, 5 Series, 7 Series, X6 ActiveHybrid
  • Buick: LaCrosse, Regal
  • Chevrolet: Malibu Eco, Silverado 1500 HD
  • Ford: Fusion, C-Max
  • GMC: Sierra 1500
  • Honda: Civic, Insight, CR-Z
  • Hyundai Sonata
  • Infiniti M35h
  • Kia Optima
  • Lexus: CT 200h, ES 300h, GS 450h, LS 600h, RX 450h
  • Lincoln MKZ
  • Mercedes-Benz E400
  • Porsche Panamera
  • Toyota: Avalon, Prius, Prius V, Camry, Highlander
  • Volkswagen Jetta

Some hybrids have come and gone. GM had full-size SUV hybrids that got more than 20 mpg n highway driving, but they only sold a couple thousand units each and were gone as of this year: Cadillac Escalade, Chevrolet Tahoe and GMC Yukon 1500.

ET Auto Guide