Nissan Motor Co., Ltd. announced its plan to build the first diesel vehicle in North America in the next few years. The decision is based on growing competition and automakers’ move towards fuel efficiency.

Carlos Ghosn, CEO of Japan’s Nissan and France’s Renault, released details of the company’s diesel strategy in a speech to the Council on Foreign Relations in Washington. Ghosn is keen that the auto industry has been short-sighted in fighting increased fuel economy standards.

Like other auto executives, Ghosn is striving to satisfy consumers’ growing appetite for fuel-efficient cars. Furthermore, fuel efficiency demands in Washington must be resolved immediately before the problems of global warming and dependence on oil cripple the industry.

In a meeting with industry editors and reporters, Ghosn said the auto industry had gotten into some trouble fighting fuel economy regulations over the years. “The auto industry…because it’s been a bit myopic, saying all the time” that a change in fuel efficiency standards “isn’t possible, this is too expensive, this isn’t going to happen,” he put into a situation where the whole world is focused on the car industry,” Ghosn said. “The carbon dioxide emitted by one car seems more harmful than the carbon dioxide emitted by all the others.”

Ghosn said any push for tougher fuel economy rules, known as corporate average fuel economy, or CAFE, should be accompanied by tougher limits on other industries that emit carbon dioxide. “If you accept CAFE for the auto industry, just make sure the other industries have something similar as well,” Ghosn said. For the new diesel-powered vehicle, the automaker is likely to draw on the expertise of Renault, which is its alliance partner.

In 2005, sixty-three percent of the Japanese automaker’s product lines in Western Europe were equipped with diesel engines. With the switch to greener and cleaner engines, other automakers are now planning more diesels in their lineup. DaimlerChrysler, Honda and Volkswagen are just a few of the automakers working with that goal in mind.

As the auto industry continues to produce more efficient vehicles, Ghosn urged lawmakers and regulators to create rules that simply don’t favor one technology over another. “At the end of the day, it’s about carbon dioxide emissions,” Ghosn said. “Let’s talk about performance, let’s not talk about technology. The competition will be in technology.”

Ghosn became famous in large part for rescuing Nissan from the brink of bankruptcy in 1999. His plan was largely based on satisfying Americans’ desire for speed and power during the truck and SUV craze. sports in the 1990s.

Ghosn has ridiculed hybrids in the past, saying their high prices didn’t make good business sense. Ghosn said he wasn’t convinced hybrids were the answer to America’s fuel-efficiency needs. But now, he is singing a new tune. “There are a lot of technologies on the table and we are working on a lot of them,” he said.

This year, Nissan introduces its first hybrid, which is a version of the Altima sedan. It won’t fascinate enthusiasts just because of the Nissan taillight, but will turn heads with its eco-friendly technology combined with great performance and looks. Hybrid technology is licensed from Toyota Motor Corporation.

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