Nissan blazes trail with clean diesel car in Japan

By Chang-Ran Kim, Asia autos correspondent

TOKYO (Reuters) - Nissan Motor Co (7201.T) on Thursday became the first domestic automaker to launch a diesel car in Japan in six years, blazing the trail for rivals looking to revive the fuel-saving engine to cut greenhouse gas emissions.

The X-Trail 20GT sport utility vehicle, powered by an engine lead-developed by partner Renault SA (RENA.PA), is also the world's first "clean" diesel car to meet Japan's new emissions standards to kick in from October 2009, said to be the strictest in the world.

Diesel cars make up more than half of the European market, but a powerful smear campaign by Tokyo's popular governor in the late 1990s deriding them as smelly, noisy and polluting has all but erased the fuel-efficient cars from Japanese roads.

Nissan was the standout among major automakers in U.S. auto sales data released on Wednesday, surprising investors with a 13.6 percent increase in August sales. [nL4561003]

The diesel X-Trail, only available in manual transmission, costs just under 3 million yen ($27,710), carrying a price premium of about 400,000 yen ($3,695) over a comparable gasoline version. Nissan said it hoped to sell about 100 units a month.

"For a long time, we had no diesel cars in Japan," Nissan Chief Operating Officer Toshiyuki Shiga told a news conference. "I'm not sure how much it would spread in the market now, but if it does well we will consider broadening the line-up."

The only other diesel car available in Japan now is Daimler AG's (DAIGn.DE) Mercedes-Benz E320 CDI sedan, launched in late 2006. While the company says reception has exceeded its expectations, a sticker price of over 8 million yen ($73,510) has kept sales volumes here at a paltry 100 units a month.

Volkswagen AG, Japan's top-selling foreign brand, is also preparing to offer a diesel car in Japan next year.