Hi smithy,
the demand may be there - but there's no market for it.
Try to calculate something for yourself: Count the engines in GA planes. About 1/20 of these will have to be rebuild or exchanged per year. Now build and _certify_ an engine which costs less than the standard Lycosaurus offering at least the same performance...
See? Not that easy anymore, unfortunately.
The SMA diesel will come in some time - via Continental.
The Thielert diesel has come back and will see a revival.
The Austro diesel powers Diamonds.
The eco hype is even funding some hybrid and electric designs.
Kind regards,
Peter