I was on vacation for two weeks, and then I needed an additional week of zoning-out to recover from my vacation. A lot has happened that I want to comment on here, and I will over the next few weeks.
On July 17th the U.S. Environmental Protection Agency published their annual Light-Duty Automotive Technology and Fuel Economy Trends report. This year’s report covered model years 1975 through 2006. Based on projections by automakers (since all 2006 model year vehicles had not been built and sold when the report was prepared), the industry-wide new-vehicle fuel economy is going to be the same for 2006 that it was for 2005: 21.0 miles per gallon.
I have two comments.
The EPA data cover vehicles weighing less than 8,500 pounds or less. Sales of SUVs and pickups weighing more than 8,500 pounds but less than 10,000 pounds have grown since 1975. Without including them we can’t really tell how much fuel economy has fallen in the past two decades or whether it might be rising in the last few years (when sales of large SUVs and pickups have declined).
To the extent that falling fuel economy is thought to reflect bad behavior by automakers, they are all guilty. The graph shows (3-year moving average) weight and fuel economy for GM and Toyota.
Between 1975 and 1985
GM improved fuel economy by more than 10 mpg, largely by cutting their average vehicle weight by more than 1,000 pounds.
Toyota improved fuel economy by 8.5 mpg, and held weight roughly constant.
GM has restored about 900 pounds to average weight, and reduced fuel economy by about 1.5 mpg.
Toyota has added more than 1,000 pounds of vehicle weight, and reduced fuel economy by about 2.5 mpg.
Walter is the Director of the Automotive Analysis Division of the University of Michigan Transportation Research Institute (UMTRI). He studies the adoption by consumers and automakers of new powertrain (electric, hybrid, clean diesel, fuel cell, alternative fuels), safety, and telematics technologies. Walter worked for General Motors for 9 years in sales forecasting, product development, marketing, and manufacturing (1993 found him on the floor of one of GM’s component factories). Prior to joining the University, he was Executive Director of Forecasting and Analytics for J.D. Power and Associates. He earned his doctorate in Economics from UCLA in 1983