Naughty or nice? Automakers and US efficiency standards
Well, it’s that time of year again! No, no, not the holidays. It’s that time of year when the U.S. EPA releases authoritative information on how the automakers are doing in meeting their carbon emission and fuel economy commitments!
As we’ve said before, the U.S. EPA’s Trends and Manufacturer Performance reports are THE definitive assessment of what the automakers are doing. Unfortunately, some news stories based on them continue to be less, ahem, rigorous than one would like (here’s a pretty bad offender), mixing up regulatory and consumer miles-per-gallon and making assertions without consulting the actual data on how companies’ fuel economy compares to the standards.
So, based on the latest data from EPA’s 2015 reports, what do the new vehicle efficiency data really have to say? Who’s been naughty and who’s been nice?
Manufacturers are mostly having little trouble meeting the CAFE/GHG emission requirements. For a third straight year, the automakers overall are about a year ahead of schedule in complying with the standards. In fact, 20 of the 24 automakers, representing over 99% percent of the market, are ahead of schedule and carrying extra credits into the future. The other four companies are also in compliance, but they just have a little extra work to do in 2015–2017 to make up for their debits. As another indicator of fleet progress, over a quarter of model year 2015 vehicles can beat the model year 2018 standards.
Other exemplary high-efficiency trends across the fleet are clearly evident. In just the past five years, the number of car models with consumer-adjusted fuel economy above 30 mpg, and SUVs above 25 mpg, has doubled. Over the same period, sales of vehicles equipped with turbocharging, gasoline direct injection, and 7+ speed transmission technologies have risen fourfold. As shown in the chart below, other efficiency technologies like cylinder deactivation and continuously variable transmissions have doubled in the market. Stop-start technology is on the rise too. In short: automakers are developing efficiency technologies, and the market is embracing them.
Some companies stand out on this “nice” list. Tesla and BYD vehicles, of course, do not emit any carbon emissions at all. Toyota (the hybrid leader) and Honda (deploying lots of cylinder deactivation and continuously variable transmission) have amassed years of overcompliance credits for being so far ahead of the standards. Two companies made conspicuously large improvements: BMW jumped a full 1.9-mpg jump to 26 mpg (an 8% increase), with most of its vehicles now being sold with turbocharging, gasoline direct injection, stop-start, and 8-speed transmissions. And we’ve mentioned before how impressed we are with Mazda’s high-compression-ratio, direct-injection SkyActiv technology; now it’s substantially rolled out that technology across its line-up. Mazda increased its fleet by 1.3 mpg to 29 mpg (a 5% increase) to achieve the highest fleet-wide fuel economy.
It’s a sure bet that the most famous denizen of the North Pole does not consider the effects of high-carbon, low-efficiency transportation to be nice. So you have to think that, as he’s making his list and checking it twice, he is not going to be happy about several trends the EPA reports show. With all the new efficiency technology, vehicles could be even more efficient than they have been getting, and achieve lower carbon emissions.
The official data point to three trends that merit lumps of coal in Christmas stockings. First is the shift to more light trucks. The shift from cars to light trucks (especially car-based SUVs), which have lower mpg standards for a given vehicle size, means we don’t see absolute mpg increases from all those nice efficiency technologies. Because the average light truck standard is over 20% lower than the car standard (27 mpg for light trucks compared to 32 mpg for cars on the CAFE test; or 22 vs 28 mpg in adjusted consumer fuel economy), the erosion of standards’ benefits is significant. Second, automakers are using many of those nice efficiency technologies for increased acceleration and/or increased payload, instead of maximizing efficiency. The new lightweight turbocharged Ford F150 full-size pickup now has the same 0–60 mph acceleration as a new Ford Mustang ten years ago! This is part of a broader trend, whereby Ford is choosing more “Boost” than “Eco” in its EcoBoost products, to generally disappointing fuel economy effect. Third, reversing a recent trend, automakers have in 2014 started selling larger vehicles again; selling more larger-footprint vehicles leads to more lax standards. Without these trends, the fleet would have shown substantial progress toward lower CO2 and higher mpg.
In addition to those fleetwide trends there are some concerns about particular companies. Fiat-Chrysler still has the lowest efficiency of the major full-line automakers, with a 21-mpg fleet; GM, Ford, and Mercedes follow with 23 mpg. Premium, low-volume manufacturers like McLaren, Aston Martin, Jaguar Land Rover, and Ferrari have lower fuel economy yet. Of course, we all know who can look forward to the biggest lump of coal this year! Volkswagen is more in a gift-giving than a gift-receiving mindset this Christmas. There were enough questions about Volkswagen that EPA kept them out of the Trends figures, as they did in the past with Hyundai/Kia irregularities.
Whether or not Santa notices or not, the latest compliance data gives clear evidence of just how naughty or nice each of the automakers has been. Considering it’s pretty clear that carbon emissions are having an impact up there at the North Pole, auto manufacturers might want to put a little more effort into staying off the naughty list.