Europeans have been paying $3 - $4 per gallon for years now, which is why so many of their cars are powered by diesel engines. Forget the "smokey, smelly, slow" reputationtoday's modern turbodiesels are clean and quick (though admittedly they still don't smell all that great), and diesel fuel is usually cheaper than gasoline. I easily averaged upwards of 40 MPG in a Golf TDI with an automatic transmission. During a week-long test of a 5-speed Jetta TDI (mechanically it's virtually identical to the Golf) and averaged 46 MPG, same as the Civic Hybrid I'd driven the week before, and the TDI was quicker and more fun to drive. One of the diesel's biggest (and most oft-overlooked) advantages is that it doesn't rely on foreign oil. Diesels can run biodiesel, a synthetic fuel made from vegetable oil and methanol, with no modifications. Hybrids still require gasoline, a non-renewable resource.
Read About Cars reveiews of the Jetta TDI and the mechanically-similar New Beetle TDI Convertible
Get pricing information for the Golf, Jetta, and New Beetle from Edmunds.com


