Auto Industry Pushes 40 MPG Models, But Says Consumers Don’t Care

The auto industry is sending mixed messages about fuel economy. Major car companies are spending billions of dollars advertising affordable 2011 models rated at 40 miles per gallon, and pushing its latest hybrid and electric cars. But then it says consumers don’t care about fuel efficiency.

“I think 40 mpg is kind of a magic mark, at least we believe it is in the industry,” said Tracy Handler, senior analyst at IHS Automotive, in today’s Automotive News. She believes most automakers “can get to 40 mpg relatively cheaply.” Handler added that Chevrolet and Ford “are using that advertising to get people in the door.”

Message #1: Consumers not only care about fuel economy, it’s the hook that’s bringing them into showrooms.

In fact, that 40-mpg message is so important that some automakers produced specialized low-volume versions of some models—like the Eco version of the Chevy Cruze and the SFE version of the Focus—just to be able claim “up to 40 mpg” in advertisements. Those models, using fuel-saving strategies, such as direct injection and light-weighting, reach 40 mpg on the highway, not average typical driving. Only the Hyundai Elantra (and the future Hyundai Accent) will achieve 40 mpg on the highway for all its versions.

Today, only hybrids achieve a combined city and highway mileage of 40 mpg, and one model (Toyota Prius) reaches 50 mpg. (This does not include electric cars like the Nissan LEAF and Chevy Volt, which use little or no gasoline.) Another missing fact: Hybrids are getting even more efficient and the prices are coming down—not to the $15,000 level yet, but with simpler approaches to gas-electric technology and declining cost curves on battery technology, that’s only a few years away.

We Can Do 40 MPG, But…

In yesterday’s Detroit Free Press, Gloria Bergquist, vice president of the Alliance of Automobile Manufacturers—representing 12 vehicle manufacturers including Chrysler, Ford, General Motors, Toyota and Volkswagen—said, “For consumers to really change their buying habits, they must believe higher gas prices are a long-term change, and by long-term, they mean five years or more.”

Window Stickers vs. CAFE

Forty mpg on the window sticker equals about 50 mpg for CAFE (Corporate Average Fuel Economy). With proposed hybrid and EV credits, that number approaches 60 mpg—a figure proposed for 2025.

The Detroit Free Press takes sales statistics out of context—like a ridiculous comparison of sales numbers for the Chevy Volt versus the Cadillac Escalade, or last year’s hybrid sales numbers—to apparently prove that consumers are not considering fuel efficiency. (The Chevy Volt is just ramping up production, and as the Freep mentions, sales of the Toyota Prius are up almost 50 percent this year, now that gas prices are up.)

Message #2: Automakers can’t hit higher fuel efficiency mandates, because consumers aren’t interested.

Ironically, comments from Rebecca Lindland of IHS Automotive stand in contrast to her own colleague, Tracy Handler, at IHS. Lindland said based on studies of past oil spikes, the “American consumer will buy small, more fuel-efficient cars for literally three to four months…and then three or four months later, we go right back to buying big cars.”

Lindland dismisses the 40-mpg magic number theory, and concludes, “The change in consumer buying behavior toward better fuel economy is not aggressive enough to meet the 35.5 mpg standard,” set for 2016.

This declaration seems out of step with the gas price spike of 2011—when automakers are proving they can make serious gains in fuel economy with a dazzling combination of affordable high-mpg gas cars, clean diesel models, hybrids of all stripes, and a wave of new all-electric cars. Just think what kind of cars could be in showrooms during the gas price spike of 2015 or 2020.

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  • C.S.

    “For consumers to really change their buying habits, they must believe higher gas prices are a long-term change, and by long-term, they mean five years or more.”

    I do…

  • JamesDavis

    American automakers have more excuses than Carter has liver pills. Japan’s cars are already getting 60 MPG, but America will not allow them into the country. America has not came out with not one production line electric car and they are complaining that Americans don’t care about MPG. What dream world are these idiots living in?

  • Amilkar

    I wouldn’t be so quick to preclude that people are not appreciative of automobiles with higher fuel mileage. The sales of electric and hybrid cars are indeed growing, along with the gradual increase of gasoline prices. As drivers become more conscious of environmental limitations and the stealth politics of oil across the globe, you will see not only more support for alternative vehicles with higher, more efficient mileage, but also for that of advancements of this particular automotive technology.

    Give it some time. This new phase in automotive history has only begun.

  • JJJ

    How many people base their $20,000 purchase on an ad slogan?

    Saying “40MPG” will get people to research the model, but then theyll be sadly disappointed to see real world numbers closer to 30.

    I dont know about other buyers, but personally, I would feel misled and feel less excited about that particular model.

  • John K.

    Give us CNG hybrids — the fastest, cheapest, and cleanest way to US energy independence!

    They’re the perfect “bridge” to when battery/ultracap tech becomes viable for making an EV your sole vehicle.

  • Toots McGoo Sez:

    Here in California gas is well over $4.05 (average) a gallon for regular…$4.30+ for premium…over 37 million people live here and I don’t think there are too many people that wouldn’t take a long hard look FIRST at a car that got 40mpg+…heck to many…that’s not enough…50mpg+ is more like it. This is a state that takes its cars seriously…

    Yes, we embraced and popularized the muscle cars, SUV’s and other trends…but I think locals here have that been there done that attitude about big and powerful cars these days and the high cost of gas plays a big role. Big SUV’s with 25 gallon tanks are harder to find than Bigfoot lately..and at well over $100 to fill one of those suckers up, it’s not hard to figure out why. A friend of mine can’t sell his Escalade and rented an economy car for a few weeks…to see if he would like the downsize… and ended up paying far less for the rental plus the gas to fill it up, than the cost of gas it cost him to fill up his Escalade every 4 days.

    Last week he bought a Honda Fit and loves it. He is a very successful attorney and got a lot of heat from the other partners in the firm for buying it…for a while…now, 8 other partners in his firm own and drive similar cars.

    Wake up Detroit..Don’t tell us that consumers aren’t interested.

  • Anonymous

    Well, 40MPG is all well and good for the highway, but 99.9% of my driving is city so the MPG is MUCH less. No thanks… I am going electric instead.

  • Mr. Fusion

    The fact that this site and exist is proof that MPG matters.
    May be the Auto Industry needs to log in.

  • Toots McGoo Sez:

    More about my attorney friend…I meant to say he bought the Honda Fit early last month…The partners in the firm did give him a lot of grief, teasing etc for going from an Escalade to a Fit…But…he is a trial attorney and always packs a persuasive argument. When he showed them the economic benefit …in gas, auto insurance, maintenance, etc as well as marketing benefits of lawyers with a conscience aspect…the partners bought in…They may not have bought the cars for the right reason…but they bought them….BTW…The austerity angle is going to be their new mantra because they are plaintiff attorneys and represent a lot of class action lawsuits pertaining to victims of environmental, wrongful termination and medical cases…They feel that if they practice what they preach, I guess they will be looked at differently and get more business. Besides, a car is just a mode of transportation…not a status symbol is once was…that’s just one more example of a paradign shift in how we as Americans view cars…

  • anonymous

    i am thoroughly convinced that the reason we cannot get the best worldwide fuel mileage cars, also the reason diesel fuel took such a horrendous upward spiral in cost is A CONSPIRACY TO FURTHER DOWNGRADE AND EVENTUALLY DESTROY THE U.S. ECONOMY [ONLY PART OF THE CONSPIRACY]

  • Ineffable

    I have been waiting for years for a new truly efficient model to come out that beats the 38-44 mpg I currently get on my 1998 Saturn. I can’t get excited about buying a new car that’s less fuel efficient than the one I’ve been driving for over a decade. If I still lived in a city with decent public transit instead of in a very rural area, I would let my car live out its life then do away with car ownership, period.

  • buddy4095

    Yeah – I still have my 38 mpg vehicle – try selling 50 mpg, 100 mpg and even 200 mph like you re supposed to . . and people will line up to purchase . . .

  • Capt. Concernicus

    I have a 2nd gen Prius that is averaging 46 mpg. So like another poster I can’t imagine buying a new car that gets significantly less than that like a Cruze Eco or a Fiesta SFE.

    So bring on the oil spikes now! Nah, just kidding. I don’t want to pay more for gas than I already do.

  • Elliot

    So, they will continue their half-hearted efforts.

    There will be another price spike.

    Those auto makers who choose not to plan for the future will be “stunned!” when consumers are clamoring for fuel efficient vehicle. “How could ANYBODY see this coming?!”

    Basically, some of them don’t want to because it is hard. They would prefer to live off the fat of outdated gas guzzling monster SUV’s. American automakers did that once and they literally almost died. Lets see if they make the same mistake twice. Of course, it is only really a mistake for the workers who might lose their jobs and the American citizens who will lose another purchasing option. The executives making these decisions will still be rich and comfortable.

  • livfreely

    I just traded in my GMC Sierra 2500 HD for a new Honda Insight Hybrid. I am very interested in fuel efficiency. The price was great, and worth every penny. I will not buy another car until they can reach a 75 mpg combined rating.

  • JJJJ

    Toots McGoo, austerity?

    It makes no financial sense to purchase an expensive new depreciating burden to save $10 a week.

  • Anonymous

    Toots McGoo Sez,

    Thumbs up to your friend!

  • Anonymous

    From The Detroit News:
    “Carmakers resist new fed fuel rules

    NHTSA and EPA are considering annual increases in fuel efficiency ranging from 3-6 percent between 2017 and 2025, which equates to a fleetwide average of 47 and 62 mpg by the period’s end. The range of government-estimated costs per vehicle is $770 to $3,500, depending on the stringency of the emissions limits.

    Automakers says those estimates are “unrealistic” and pointed to a Center for Automotive Research analysis that said hiking fuel efficiency to 60.1 mpg could boost vehicle prices by 22 percent, cut sales by 25 percent and trim up to 220,000 auto sector jobs.”

    Sigh. Old habits die hard, here we go again.

  • jim1961

    Most who come to this website are not the problem. The problem is the average consumer. I have a friend who is not a climate change denier and who has enough sense to know fuel prices will climb in the future. And yet he wants to buy a Ford expedition. Keep in mind that 50% of the population has a two-digit IQ.

  • Ed1980

    The public is not going to get on board with small 40 mpg cars until the Insurance Industry lowers the insurance for that type of car!

    When the consumer has a choice between a 2012 Focus that gets 40 mpg and the Fusion gets 32 mpg, with the price difference minimal for the same features >> They will pick a Fusion because the Insurance is 30% cheaper than a Foucus! In fact a 2012 Focus insurance cost is 30% more than a 2012 Mustang V6 that gets 31 mpg!

  • Walter Lee

    I have a 2010 Toyota Prius III, if u drive it for from 10 to 20 minutes a day in the freezing cold it will get about 44 mpg but if you drive it for about 45 minutes in one direction in warm weather u get about 55 mpg in combined city/hwy driving. If you hypermile for long distances it gets between 55mpg to 70 mpg. I got about 32 mpg on the hwy with my 1990 Honda Accord LX (with an automatic). It should be possible to get +40 mpg on the highway with one of today’s lighter-smaller conventional gasoline car (like the toyota Yaris or Honda fit) if you don’t go over 55 mph and you have something like a scangauge and LLR tires. Getting anything over 75 mpg is difficult at speeds greater than 35 mph because of wind drag.

  • Anonymous

    People do buy, thats why there are 1 million Prius on the roads in USA today.

    Today gas prices touched $3.60 and its going to increase as Chinese keep buying more vehicles. Dont dream of gas prices going back to $1 / gallon. If you are buying a new vehicle, then consider hybrid seriously if you drive more miles or atleast the 40 MPG Focus, Elantra & Cruze if you drive less miles.

  • Anonymous

    In 2008, when gas prices crossed $4 / gallon and then fell (because of recession), people thought its a 1 time event caused by speculators.

    But in 2011, when gas prices increase again, some people may again blame it on mid-east events, but more people are convinced that its the genuine demand from China that has caused this and prices will continue to increase.

    So there are high chances that people will stick with these 40 MPG vehicles.

  • Anonymous

    Read this article.

    Buick is going to sell Lacrosse with e-assist (same as Honda Insight’s Partial Hybrid) and it gets 25/37 city/hwy mileage. And it may be priced the same as V6 model. So Buick is replicating what Lincoln did with MKZ. 2nd hybrid model with no price premium. As Hybrids become common, more 40 MPG models with come.

    And they are going to apply this system in Regal as well, being a smaller car, that may give even higher mileage.

    Remember, earlier all Buick buyers went for V8 engine, now its coming down to V4. Thats a big progress in mileage.

  • Anonymous

    Read this article.

    Buick is going to sell Lacrosse with e-assist (same as Honda Insight’s Partial Hybrid) and it gets 25/37 city/hwy mileage. And it may be priced the same as V6 model. So Buick is replicating what Lincoln did with MKZ. 2nd hybrid model with no price premium. As Hybrids become common, more 40 MPG models with come.

    And they are going to apply this system in Regal as well, being a smaller car, that may give even higher mileage.

    Remember, earlier all Buick buyers went for V8 engine, now its coming down to V4. Thats a big progress in mileage.

  • Anonymous

    From Mar 28 2011 Autonews:

    ‘On the Super Bowl telecast, also last month, a Chevrolet commercial showed a group of senior citizens who have difficulty hearing and believing the Cruze’s 42 mpg.

    But while Chevrolet and Ford tout their 40-mpg models in advertising, only a small percentage of Cruze, Fiesta and Focus models hit that mark.

    Ford’s optional Super Fuel Economy package, SFE for short, is available only with the SE trim. The Cruze Eco requires a manual transmission to reach 42 mpg on the highway. All of the 40-mpg or better Chevrolets and Fords are expected to be low-volume players.

    IHS’ Handler says Chevrolet and Ford “are using that advertising to get people in the door.” […]

    Rich Brusky, new-car sales manager at Heiser Chevrolet, also in West Allis, says buyers don’t care about the fuel economy difference. “The Eco has had quite a bit of interest, but they have been kind of hard to get. People who buy the automatic still get good gas mileage.”

    Ford, meanwhile, is touting its 40-mpg versions of the Fiesta and Focus. That’s 2 mpg higher than the regular models with automatic transmission. Most of the 2 mpg increase stems from low-rolling-resistance tires, included in the optional SFE package.

    Jim Heutel, president of Sunset Ford in St. Louis, says the 2 mpg increase is unlikely to sway a buyer. His challenge is Fiesta allocation — he needs more cars. He does not have a Fiesta with the SFE package, nor is he sure he wants to order that model.

    Heutel says: “When you only get a couple offered to you, which ones do you stock? Which one is going to be the fast turn?
    “Would I really rather have the one that gives me two more miles to the gallon than the one that has the brighter color and a few more accessories?” ‘

  • Anonymous

    March auto sales is in

    LEAF sold 298 units and Volt sold 608 and thats 900 +.
    Meanwhile Prius sold 18,000 + while CT200h sold 2,100 + – superb start.

    Lincoln MKZ Hybrid reached a record 615

    Also 37 % of Ford F-150 sales is V6, which means the V8 is going away.

    Also Altima has overthrown Camry in Sales. Altima has CVT while Camry has outdated 5-speed tranny. Time for Toyota to rethink.

  • Anonymous

    I think it depends whether you see it as the glass half-empty, or half-full. If 37% Ford F-150 sold last month is V-6, doesn’t that mean 63% (almost double that of V-6) are still V-8?

    So, what’s the percentage of inline-4 sales for Ford Explorer last month?

  • Anonymous

    Ford’s press release doesn’t mention Fusion hybrid.

    Em, let me see, is it possible that Fusion hybrid’s sales is, em, in the eyes of Ford, less than ‘satisfactory’?

  • David

    I think that mpg is ultimately important, but it’s not the only thing. Everyone really feels that they are literally being taken for a ride and have no say in the matter. Gasoline prices affect everything from products we buy everyday to food prices. It will get so ridiculous that we will all be riding bicycles eventually.

    If fuel prices continue to rise and stay there, we would be silly not to consider more economical vehicles, but at what price?

  • anonymous

    diesel, affects everything we buy, helping to ruin economy, I think deliberatey David

  • Anonymous

    How much did they give you in trade? Anything?

  • Tod

    Simple answer for auto companies: make SUVs, trucks, and larger cars with hybrid, hydrogen, and higher-efficiency petrol options, then consumers will buy more of the high mpg models.

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