"Diesel is a no-brainer for pickup trucks -- they're bullet proof, run forever and get great mileage," said Thad Malesh, principal of California-based research firm Automotive Technologies Research Group. "It will be a market requirement."

Homegrown brands like Ford Motor Co. are especially keen on the technology, hoping to gain a competitive edge over Japan's Toyota Motor Corp. and Honda Motor Co., which are behind in diesels but are winning market share in the United States with popular hybrid offerings.

To be sure, all automakers are developing and improving hybrid technology as well as other fuel-saving options like cars that run on ethanol. Ford this week unveiled plans for a tenfold jump in hybrid output by 2010.

But diesels are touted as a proven technology with high torque, towing power and durability, and as being more suited than others for hauling and long-distance driving.

"I think diesels could offer North America a very significant benefit in improving fuel efficiency and reducing greenhouse gas emissions," Ford Chief Operating Officer Jim Padilla said at the Reuters Autos Summit this week.

He said Ford was preparing to add more products to its diesel line-up, which includes versions of its popular F-series pickups.

GOOD PERFORMANCE, BAD IMAGE

Diesels get 20 percent to 40 percent better fuel economy than gasoline vehicles and account for more than half of Europe's car market.

But they have failed to gain traction in markets like the United States and Japan, where diesels suffer from a poor image due to the higher emissions of pollutants such as nitrogen dioxide and particulate matter, or soot.

Still, with the United States' introduction of stricter sulfur-content and emissions standards by 2010, experts say diesels could be a sound ecological choice, given the low levels of carbon dioxide emissions linked to global warming.

Proponents also note that diesels cost less to produce than hybrids -- about 1.15 times that of a conventional gasoline car versus 1.25 times for gasoline-electric hybrids, according to Tokyo-based Yano Research Institute. Hybrids require more parts, including a battery to capture lost energy while braking, and an electric motor that the battery feeds.

And while hybrids can theoretically get better mileage, they need stop-and-go driving for maximum efficiency, meaning someone used to cruising on highways is better off with a diesel.

That's a big market in the United States, where drivers travel an average 18,870 km (11,730 miles) a year -- nearly double the distance in Japan and far more than 12,600 km in diesel-smitten Germany, according to official Japanese data.

Hybrids also have a relatively short battery life -- Toyota has an 8-year warranty on theirs -- raising questions over net financial gain if drivers were to spend an estimated few thousand dollars for the component every decade, on top of the thousands in premium already paid for a hybrid system.

"There's potential for diesel," said Jeff Schuster, auto analyst at J.D. Power. The consultancy expects diesel penetration on passenger vehicles to roughly double to 7 percent of 8 percent by 2010, compared with 3.5 percent for hybrids, up from 1.3 percent expected this year.

TOUGH HURDLES

Like Ford, DaimlerChrysler AG and other automakers with European ties said they saw a bright future for diesels.

"We definitely have plans for diesels with full-sized trucks and SUVs," said Jed Connelly, senior vice president of North American sales at Nissan Motor Co., which shares various technologies with France's Renault SA.

But laggards such as Toyota and General Motors Corp. argue that upcoming US regulations for nitrogen dioxide and particulate matter would require too much spending on research and development.

US standards for 2007 will be far more stringent than those in Europe today and will be even tougher by the end of the decade, to levels that John Smith, GM's vice president of global product planning, characterized as "almost ridiculous."

"They have a standard out there for nitrogen oxides in 2010 which is five to six times stiffer than in Europe in the same time frame," Smith said.

"The cost of doing it would make the cost of a diesel vehicle prohibitive," he said, adding that diesel passenger vehicles had a slim chance under those standards.

Toyota, which wants to see hybrids take off to earn back the huge outlays already spent, agreed that costs would be an issue.

"With diesel, you have to add fairly expensive traps and filters and systems, so it's not as clear or simple to say one is better than the other," said Jim Press, head of Toyota's US operations.

But he didn't rule out a future for diesels, saying they would probably co-exist with hybrids.