Takashi Yamanouchi

… saw their holdings diluted. The stock fell to record lows. Now, the cheaper local currency is giving Mazda CEO Takashi Yamanouchi , 68, breathing room to show his turnaround efforts are bearing fruit and for the company to focus on rolling out …

TOKYO (Bloomberg) -- Thirteen years after Tokyo's governor killed Japanese interest in diesel cars by barring many of them from his city, the technology is making a comeback as manufacturers adopt innovations that improve its sooty image. Mazda Motor Corp. is betting big on cleaner diesels, creating a challenge to imports and hybrids as government incentives spur demand for fuel-efficient vehicles. The new cars compete with SUVs from Nissan Motor Co. and Mitsubishi Motor Corp. and models that BMW and Daimler ship from Europe, where half of new cars use the engine and most automakers -- including the Japanese -- offer diesels. Improved filters, turbochargers and fuel injection have helped make the motors quieter and cleaner than in 1999, when Gov. Shintaro Ishihara waved a bottle of black soot at reporters as he campaigned to bar them from Tokyo streets. "I remember the diesel car I used in driving school 22 years ago -- a noisy, dirty one that produced smoke and soot," said Atsuo Ito, a 39-year-old advertising executive who bought a new Mazda Diesel CX-5 crossover. "This car is quiet, clean, and most important, it cut my monthly fuel expense by half." 'Brisk demand' The national government this year introduced subsidies of as much as 180,000 yen ($2,200) for diesels. By 2020, the government wants 5 percent of new passenger vehicles to use the technology, up from 0.4 percent last year. As of October, sales of diesels had tripled from last year to 31,425 units in Japan, according to the Japan Automotive Dealers Association. "The idea younger people have of diesel cars is quite different from the elder generation, who were influenced by Ishihara," said Yoshiaki Kawano, an analyst with IHS Automotive in Tokyo. "Their impression is that the cars are environmentally friendly and popular in Europe." Mazda said 80 percent of orders for its CX-5 sport utility vehicle and Mazda6 sedan in Japan this year are powered by diesel engines even though they cost about 20 percent more than comparable gasoline versions. A diesel CX-5 gets 18.6 kilometers per liter (43.7 miles per gallon based on Japanese standards), 16 percent more than the comparable gasoline version, according to Mazda. "We have been surprised to see such brisk demand," Mazda President Takashi Yamanouchi said last month. Customers are "convinced that they want diesels." Global sales of diesel cars will rise 66 percent between 2010 and 2018, to 22 million, making up about 18 percent of total vehicle deliveries in 2018, according to LMC Automotive. Growth will come mainly from North America, Eastern Europe and Asia, while diesel's share in Western Europe will decline due to regulatory standards and market saturation in some countries, the researcher said. American renaissance Diesel engines can be more efficient because the fuel burns at a higher temperature than gasoline. But diesel's higher energy density means it can also emit more soot. In recent years, manufacturers have improved catalytic converters to burn soot and have added filters to capture more of the emissions. Reviving the engine in Japan may help the nation's automakers break into the U.S. LMC Automotive expects diesel sales there to more than triple to 1.3 million in 2018 from 408,344 last year as stricter federal fuel efficiency standards are phased in starting in 2017. "Clean diesel cars and light-duty trucks are in the early stages of a renaissance in America," said Allen Schaeffer, Executive Director of Diesel Technology Forum, an industry group whose members include car and component makers. Biggest commitment The diesel Mazda6 will be introduced in the U.S. next year. That will make Mazda the first Asian carmaker to sell a passenger car using the engine in the American market, where European makers such as Volkswagen AG set the pace. "If the Mazda6 is priced below the Passat TDI and has great fuel economy, it can be a hit," said Mike Omotoso, senior manager of global powertrain research at LMC Automotive in suburban Detroit. Mazda, which this year ended 45 years of rotary engine production, is making the biggest commitment to diesel among its Japanese rivals. It has increased advertising and is pairing the CX-5 and Mazda6 with its SkyActiv, an umbrella term for technologies that help it comply with stricter emission standards such as lighter vehicle bodies. The company "has spent hugely on TV commercials and advertising to raise people's awareness and change the public image," said Masahiro Fukuda, an analyst with Fourin Inc. in Nagoya, Japan. In the revamped models' first year on the market, Mazda expects worldwide sales of 240,000 for the Mazda6 and 190,000 for the CX-5. The company doesn't release separate forecasts for diesel sales. Tokyo ban Japanese diesel vehicle sales peaked in the 1980s, accounting for as much as 6 percent of new car deliveries, according to the transport ministry. In 2003, Tokyo started requiring diesel owners to install exhaust gas purifiers and barred those that didn't from driving their cars in the city. In 2001, Japanese carmakers produced 24 diesel models. By the end of 2007, there were none made at home. Nissan was the first Japanese carmaker to reintroduce diesel into the nation's passenger market with the X-Trail SUV in 2008. Mitsubishi followed with a diesel variant of its Pajero. Last year, the two were the only diesel cars produced by domestic carmakers for their home market. Toyota, the world leader in hybrids, agreed last year to use diesel engines supplied from BMW starting in 2014 to expand its European lineup. The carmaker offers no diesel cars in Japan. Different smell BMW, which ended a two-decade hiatus on diesel imports to Japan this year, says it's bringing six models to the country. Mercedes in 2010 became the first foreign producer to reintroduce diesel cars in Japan and now says it has three vehicles in the market. Ishihara, who resigned as Tokyo governor in October and is running in the Dec. 16 lower house national election, changed his opinion of diesels after a trip to Europe. "I found cars on the roads were almost all diesel-powered, but the smell was completely different from what we used to have in Japan," the former governor said at a press conference in March. "Diesel cars will make a comeback in Japan, which is a good thing."

… deal to make roadsters together, the companies are looking at other possible joint projects, Mazda's CEO said. Takashi Yamanouchi , CEO of Mazda Motor Corp., said that engineers from the automakers are drawing up an "opportunity list" of …

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… the statement. Mazda lowered its revenue forecast 1.4 percentandnbsp;andyen;2.17 trillion yen. President Takashi Yamanouchi said China deliveries will probably fall 40 percent this quarter and 20 percent the next as Mazda followed Honda …

… 2012, Mazda said, its sales in Europe fell 14 percent to 183,000 units. Earlier this year, Mazda President Takashi Yamanouchi pledged to seek alliance partners "actively." But both Mazda and Fiat downplay the possibility of a capital tie …

… of service and assistance locating a new job. The changes are part of a global restructuring at Mazda that CEO Takashi Yamanouchi has called a "spectacular structural transformation encompassing randd, production, sourcing, sales and all …