VW had to detune their diesel engine to meet US emissions standards, just like the rest of the US auto industry.
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Fuel efficiency takes a back seat to emissions. Your current vehicle has WORSE fuel economy than a similar vehicle built 25 years ago.
That’s not entirely due to emissions. That’s also due to mandated safety devices and construction elements, which massively raise the weight of a car. Many small cars easily top 3000lbs today, whereas many in the 80s were close to 2000. That extra weight reduces fuel economy.
Also worth mentioning: ALL the (few) other people selling diesel cars on the US market had to comply with the regs. Mercedes did just fine, to name one - they complied with emissions and good both good performance and fuel economy out of their diesels. VW didn’t even try and cheated.