TORRANCE, California — Toyota is developing a new family of clean diesel V8 engines for its full-size Tundra pickup and Sequoia utility vehicles, including a 4.5-liter unit that is expected to be in production by model-year 2010, Inside Line has learned.

In addition, the automaker will offer a new version of its existing 4.7-liter V8 that will run on E85 ethanol.

Industry sources told Inside Line that Toyota engineers have been working on at least two variations of the new clean-diesel engine, including the 4.5-liter unit and a larger 7.0-liter V8 that would dwarf the company's 5.7-liter gasoline V8.

The 7.0-liter V8 diesel has been engineered as the workhorse unit in a new heavy-duty edition of the Tundra pickup that's tentatively slated for production in 2011-'12. The heavy-duty Tundra would be aimed primarily at commercial users, as well as consumers who need to tow boats, campers and horse trailers, and would compete with similar offerings from Chevrolet, Dodge, Ford and GMC.

Last year, Toyota announced a partnership with Isuzu to build diesel engines. At the 2008 Detroit Auto Show in January, Toyota President Katsuaki Watanabe told reporters, "A new clean-diesel V8 engine will be offered in both the Tundra and the Sequoia in the near future."

At last fall's SEMA show, Toyota showed a Tundra Crew Max diesel dually concept with a massive 8.0-liter six-cylinder engine from truck subsidiary Hino — but then said the vehicle was not intended for production.

Earlier this year in Australia, Toyota launched a new twin-turbo 4.5-liter V8 diesel in the big Land Cruiser 200. That engine could be a prelude to the new diesel that's planned for the Tundra and Sequoia in the U.S.

What this means to you: There is still an outside chance that Toyota may scrap plans for the big diesel engine and the heavy-duty Tundra, depending on market conditions. — Anita Lienert & Paul Lienert, Correspondents
IL Insider: Toyota Developing Massive Diesel V8 for Heavy-Duty Tundra