NISSAN Motor Co, Japan's third-largest car maker, has reintroduced a diesel-powered vehicle to the domestic market after a five-year hiatus, betting higher gasoline prices will boost demand.

Nissan's diesel-powered X-Trail sport-utility vehicle would be priced at 3 million yen (US$27,750) when it goes on sale on September 18, the company said in a statement yesterday.

Nissan aimed to sell 100 units of the model a month, Bloomberg News reported.

Japanese car makers are bringing out new versions of diesels, which accounted for just 0.1 percent of new car sales in Japan last year, betting that an average 29-percent rise in gasoline prices in the year ended July will spur sales.

The new X-Trail SUV, with a 2-liter engine, is 30 percent more fuel-efficient than a 2.5-liter gasoline engine with the same power output.

'Japanese people hate diesels. They think of them as being noisy, dirty and emitting black smoke,' said Koji Endo, a senior analyst at Credit Suisse Group in Tokyo.

'Diesels have improved significantly, but it's questionable whether consumers will accept them.'

Mitsubishi will reintroduce a diesel version of its Pajero SUV next month, its first in four years, while Honda and Volkswagen will bring diesels to Japan next year.