Renault expects diesel engines to disappear from most of its European cars, company sources told Reuters, after the French automaker reviewed the costs of meeting tighter emissions standards following the Volkswagen scandal. The sober reassessment was delivered at an internal meeting before the summer break. It shows how, a year after VW admitted engineering software to cheat U.S. diesel emissions tests, the repercussions are forcing major European carmakers to rewrite strategic plans that will shape their futures for years to come. Renault and domestic rival Peugeot, both heavily invested in diesel technology, initially scrambled to defend its future viability after the VW crisis erupted.But in the July meeting, Renault's Chief Competitiveness Officer Thierry Bollore said the diesel investment outlook had dimmed significantly, according to two people who were present."He said we were now wondering whether diesel would survive, and that he wouldn't have voiced such doubts even at the start of this year," said one of the people."Tougher standards and testing methods will increase technology costs to the point where diesel is forced out of the market," the source summarised Bollore as saying.Diesel engines, pricier but more efficient than gasoline, had already vanished from the smallest 'A'-segment vehicles like Renault's Twingo well before VW's so-called 'dieselgate', as their extra expense outstripped savings on fuel. By 2020, Renault now predicts that the toughening of Euro 6 emissions rules will push diesel out of cars in the next 'B'-segment size category, including its Clio subcompact, as well as some 'C' models such as the Megane hatchback, the sources said.Models in those first three size categories accounted for most of the group's 1.6 million European deliveries last year, and more than 60 percent were diesels."Everybody is backtracking on diesel because after 2017-18 it becomes more and more expensive," said Pavan Potluri, a powertrain analyst with consulting firm IHS Automotive.While the VW scandal centred on the German carmaker's cheat software, it also focused public attention on an industry-wide disparity between nitrogen oxide (NOx) emissions on the road and those recorded in regulatory tests. Mass-market diesels that meet legal NOx limits in approval tests commonly emit five times as much or more in everyday use. The gases contribute to acid rain and respiratory illnesses blamed for hundreds of thousands of deaths globally each year. Starting in 2019, however, vehicle approvals will be basedon emissions performance during real driving. This is forcing manufacturers to install costlier emissions treatment systems.The business case for diesel can only deteriorate further, industry leaders realise, as targets become stricter, while electric and hybrid car batteries get cheaper and more powerful."Beyond 2025 there may be some manufacturers that completely drop diesel, because the cost of electrification will have come down significantly," Potluri said.Diesel car sales will plummet to 9 percent of the European market in 2030 from 52 percent today, management consultant AlixPartners - regarded as an authority on the auto industry -predicted in June, with the decline accelerating after 2020. Renault and alliance partner Nissan assume the next wave of emissions rules, Euro 7, could halve NOx output limits again to 40 milligrammes per kilometre, senior powertrain engineer Alain Raposo told a technical conference this summer.Renault is not alone in predicting a bleak future for diesel, though its projections go further than the doubts expressed by other carmakers about the technology. VW now wonders "whether it still makes sense to invest a lot of money in further developing diesel", Chief Executive Matthias Mueller said in June. The German carmaker's final bill for the scandal will likely far exceed the $15 billion settlement agreed so far in U.S. fines and vehicle buybacks.Wolfsburg-based VW is the only carmaker to have admitted using illegal software cheats. Similar allegations have been levelled by German officials against Fiat Chrysler, and by South Korean authorities against Nissan vehicles equipped with Renault engines - and in both cases denied.