Trust (or don't), but verify

The recent disclosure that Hyundai and Kia had overstated fuel economy for many vehicles illustrates why and how compliance and enforcement measures are important parts of vehicle emissions regulations—and why we should worry about that.

Hyundai engineers made “procedural errors” during coastdown testing, a preliminary step used to determine the load placed on vehicles when they’re tested for fuel economy. Once concerns were brought to the US Environmental Protection Agency’s (EPA) attention, it was a relatively simple matter for EPA to verify what had happened and—using the extensive enforcement capabilities which it has developed under the authority of the Clean Air Act—force Hyundai to make corrections. To its credit, Hyundai responded quickly and positively, and will reimburse over a million owners for the cost of the increased fuel consumption.

But there are two important questions to be asked here. Why did it take EPA a year to find the problem? And what, if anything, does this episode tell us about a bigger picture, like what’s happening in other parts of the global market?

In the 1980s, EPA used to routinely conduct confirmatory coastdown tests on 5 to 10 vehicles per year. These vehicles were run at an independent test facility, and EPA staff were on hand to ensure the vehicle was representative and the test conducted according to specific procedures. Even though this amounted to less than one vehicle per manufacturer, the confirmatory tests were very effective. But, after years of testing without finding a single vehicle out of compliance, EPA ended confirmatory coastdown testing about 20 years ago.

We don’t know exactly what happened at Hyundai. This could easily have been an honest mistake. But it would be naive not to acknowledge the risks built into a testing regime that lacks any compliance mechanism—the temptation that must arise, once the threat of being caught is removed, to take advantage of flexibilities in order to meet internal fuel economy targets. Especially since fudging how a test is run doesn’t increase the cost of meeting those targets. And of course we don’t know if other manufacturers have also made “procedural errors” in their coastdown testing.

What we do know, for certain, from experience, is that the continuation of even a very limited coastdown compliance program by EPA would likely have prevented this problem from occurring in the first place.

At least EPA had the requirements on the books and was able to find the problem and fix it, once concerns about fuel economy were raised by others. The situation in other countries is not so hopeful. Hyundai said in a statement on Monday that its mistakes only affected vehicles sold in North America. “All Hyundai cars sold in other regions of the world have been properly certified with correct fuel economy ratings by each respective certification agency.” Maybe.

It is important to understand that no certification agency in the world other than the EPA has enforcement criteria for coastdown tests. Thus, the fact that Hyundai vehicles were “properly certified” does not mean that the same coastdown problems do not exist. In fact, data from Europe suggest that discrepancies exist between the road load being reported by manufacturers’ coastdown tests and real in-use road load, with the result that the fuel economy on the test cycles is overstated. (The discrepancies found in Europe likely result from a combination of problems with the testing procedures and a lack of confirmatory testing). But regulatory agencies in Europe are virtually powerless to do anything about it. And with other countries and regions in the world having adopted the European requirements, the US and Canada are the only countries that currently have any effective enforcement criteria.

When it comes to achieving accurate test results, whether for efficiency or for pollutant emissions, details matter. A lot. And this extends far beyond coastdown testing. The EPA has investigated and established compliance procedures for every aspect of vehicle selection and testing. Other countries have not, and may therefore be paying a high price in vehicles that use more fuel and emit higher emissions than if they complied with the standards.

Vehicle testing