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US Consumers Shifting Away from Average Fuel Economy in Both Directions; Sales of Less-Efficient Vehicles Increasing as Well as Sales of More-Efficient Vehicles
4 October 2007
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| Distribution of sales of light-duty vehicles in the US by fuel economy bands (mpg US). Fuel economy is combined and adjusted per the EPA 2008 methodology. Click to enlarge. |
Although the percentage of sales of more fuel-efficient light-duty vehicles in the US has increased since 2000, so has the percentage of sales of less fuel-efficient vehicles compared to average new fleet fuel economy.
From 2000 to 2007 (projected), the US new fleet fuel economy has averaged 23.1 mpg (combined, adjusted). For the same period, the percentage of new vehicles sold that offer between 20-25 mpg has dropped 9 percentage points, from 43.3% to 34.3%, according to data published in Appendix C of the US Environmental Protection Agency’s report, Light-Duty Automotive Technology and Fuel Economy Trends: 1975 Through 2007. (Earlier post.)
At the same time, sales of vehicles in the 15-20 mpg band have increased by 3.7 percentage points, from 38.1% to 41.8%. This band represents the largest percentage of projected new vehicle sales in the US for 2007.
The more fuel efficient bands have seen increases as well. Sales in the 25-30 mpg band climbed 5.1 percentage points from 10.5% in 2000 to 15.6% in 2007.
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| Shifts in distribution of new vehicle sales by fuel economy band from 1975 to 2007. Click to enlarge. |
Looking back over the last 20 years, new fleet fuel economy has changed little, averaging 23.3 mpg. In 1987, vehicles in the 15-20 mpg band represented 23.3% of sales; vehicles in the 20-25 mpg band represented 38.2% of sales; and vehicles in the 25-30 mpg band represented 25.8% of sales. By 2007, that shifted to 41.8% for the 15-20 mpg band; 34.3% for the 20-25 mpg band; and 15.6% for the 25-30 mpg band.
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October 4, 2007 in Fuel Efficiency, Sales | Permalink | Comments (32) | TrackBack (0)
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I've been getting 34-36mpg on my Corolla the last few tanks. The change in the weather (cool enough not to use AC) and probably to a winter blend of gas makes a real difference.
Posted by: Cervus | Oct 4, 2007 11:59:25 AM
The numbers appear to be based on the old EPA test procedures for MPG.
The increase in sub-20MPG vehicle sales is what happens when Detroit dumps its big iron at a loss rather than face reality and shift production to smaller cars and trucks. Part of the problem is that US assembly lines are usually inflexible because that reduces cost.
Still, unless you have a legitimate requirement for a large vehicle that gets less than 20MPG, you really shouldn't buy one. By legitimate, I mean you have a very large family or, your business involves hauling a lot of heavy and/or bulky goods.
For recreational use, rent a truck when you need to tow something. There is no justification for going shopping in an F-350 or similar behemoth. This isn't a question regarding your personal freedom. Nor do I care how fat your wallet is. It's about not being a completely selfish something-or-other when it comes to using finite fossil fuel resources.
Posted by: Rafael Seidl | Oct 4, 2007 12:05:54 PM
This seems to reflect (to some degree or another) the growing income gap in the US. Also, studies have shown that $3 gas is not having the same effect on driving habits (curbing them) that expensive gas did in the early eighties. Its going to take substantially higher gas prices to make a real difference.
Posted by: pauln | Oct 4, 2007 12:09:23 PM
Read this http://money.cnn.com/2007/10/04/magazines/fortune/taylor_debunk.fortune/index.htm?postversion=2007100414
Oh and Rafael Seidl and anyone else who things Toyota's all that special and super green. They may have the Prius but Toyota has plenty of "big iron" that they have up to $2500 on the hood to move. They built the Tundra to beat the Big 3, it's not selling so well so now they've joined them with cash incentives. Don't think that any automaker is so different just because of a few hybrids. Soon many of the full line automakers will have full hybrids of one sort or another in their vehicle lineup and so they'll all look about alike.
Stop blaiming the automakers, sure they advertise their products and that swings consumer choices but when the consumer shows up at the lot they can read the stickers and see the MPG numbers. I've said it many times here and over at autobloggreen the only way your going to change consumer behavior is to increase fuel prices.
Posted by: Tim Russell | Oct 4, 2007 12:43:06 PM
"Stop blaiming the automakers"
"the only way your going to change consumer behavior is to increase fuel prices"
Except for that other way, which is to force the matter on the automakers using targeted legislation. The automakers have been battling that kind of thing for a long time. So they share no part of the accountability for that, just the consumer alone?
Posted by: Jim G. | Oct 4, 2007 1:03:57 PM
"the only way your going to change consumer behavior is to increase fuel prices"
This is a false statement! Fuel prices have more than doubled in the last couple of years and it has had very little effect. Consumption has not gone down.
Engineering is the ONLY way out of the mess we have created. I know of no law of physics that says that an F-350 can only get 17MPG.
If you build a truck that performed like the current trucks but got 30mpg instead of 15mpg. People would buy it; difficulty: people will not pay 50K for an F-150. Don't say it can't be done, because that is just not true.
Posted by: Joseph | Oct 4, 2007 1:45:45 PM
"I know of no law of physics that says that an F-350 can only get 17MPG.
If you build a truck that performed like the current trucks but got 30mpg instead of 15mpg. People would buy it; difficulty: people will not pay 50K for an F-150. "
so in fact people would NOT buy it (or rather they would not be willing to pay the premium for increased fuel economy). Colin Chapman, the legendary Lotus engineer, would turn in his grave to see the bloated, ugly SUVs now clogging up America's roads. He emphasised above all light weight, an aerodynamic shape and a good chassis as the fundamental requirements for an excellent handling vehicle; lazy designs like the F-150 fail to meet any of these criteria. Fundamentally, it is more expensive energetically and financially to push around 2 or 3 tonnes of unnecessary metal. That is simple Newtonian physics.
Posted by: gavin walsh | Oct 4, 2007 2:05:35 PM
@Tim Russell -
where exactly did I ever claim Toyota was all that special and super green?
Fact is, the Detroit automakers depend on truck and large SUV sales to a much greater extent than any of their competitors. And it is they who started the ruinous discount wars. Toyota chose not to build a full-size truck for the US market in the 1990s because the Big Three were still in a position to fend them off in that segment at the time. Now, they no longer have the cash to do so, so Toyota can afford to pile on the pressure. They may be losing money on each sale, but it's money well spent if it drives one or more of their competitors out of business altogether.
Posted by: Rafael Seidl | Oct 4, 2007 2:22:16 PM
I don't think Toyota wants to drive anyone out of business, I believe they just want an overwhelming portion of the sales but would prefer if their competitors stayed in business...
Posted by: Patrick | Oct 4, 2007 2:56:18 PM
Why should there be a premium for better fuel economy. Because they have brainwashed everyone into believing this. For years they have been charging more for diesel engines than gas engines because the diesel gets better mpg. They are doing R&D already and it's already built in to the current cars price. They did not spend one penny more R&Ding the Volt than they would R&Ding any other new line of vehicles.
Posted by: Joseph | Oct 4, 2007 3:43:56 PM
one more observation: the point is made that many American consumers are choosing gas guzzlers over efficient cars, but it's also true that boosting fuel economy by law has been supported by a majority of Senators, each time blocked by someone (e.g. Senator Carl Levin representing Detroit), because that how the Senate works, each member having lots of power. Can't it be argued then the public wants fuel economy yet the automakers are to "blame" for stopping it? What about stopping the finger pointing altogether. The automakers can do it, if they just take some of this stuff off the motor show floors and put it on the road.
Posted by: Jim G. | Oct 4, 2007 3:48:36 PM
Joseph,
What industry do you work in? You don't need to reveal the company name, but your company's relative position in it's industry would be helpful.
You seem to think like the sales people I have to interface with on a daily basis, "Why can't we just take this equipment which has X certification and slap on Y certification...it shouldn't cost anything extra!" Never mind the fact that you are talking about an extra 120+ man hours of documentation and sample preparation (which definitely is NOT free), $10,000 to $100,000 in lab fees (depending on what you are certifying and how), etc. Yet these sales people think it should cost nothing so they can sell an extra 10 units and make a nice little boost in their commissions.
Go take a piece of electronics equipment to your local ACO and get it certified for TSO. Tell me how much you end up spending...and how, even though you didn't need to do any further R&D or actual changes to your equipment (unlike improving fuel efficiency which would be major changes to your vehicle) you plan to recoup that cost without charging the consumer more for a TSO version of your equipment that is actually identical to the non-TSO version but has a "TSO sticker".
Posted by: Patrick | Oct 4, 2007 4:28:50 PM
Joseph's Bio
BBA in Finance Univ of Texas '90
MBA in Economics TCU '92 Thesis "Transportaion Economics"
My partners and I own a PCB Layout and Design Prototype electronics company (R&D). I have Spacial/Electrical engineers on staff that do the impossible on a regular basis. That is why I say "don't tell me it can't be done"
I never said R&D was not expensive. However, if neither X or Y exist, it cost relatively the same to R&D either. If you smooth that over mass production, the % of difference gets even smaller.
Posted by: Joseph | Oct 4, 2007 5:15:33 PM
Used to be that people had a choice in what size of engine they could put in a big family station wagon. The same size car could have anywhere from a 3.5 liter engine up to a 7 liters. You had choices in what transmission and whether or not to have air conditioning. Now about the only choice is over what color paint or a back seat DVD. As far as matters concerning fuel consumption consumers have no choice. Why can't I get a full sized 2WD pickup with a 3.5 ltr six banger and manual transmission???
Posted by: tom deplume | Oct 4, 2007 6:13:41 PM
Why can't I get a full sized 2WD pickup with a 3.5 ltr six banger and manual transmission???
Because not enough people want them to make it worthwhile for the mfr to certify the configuration.
Posted by: George | Oct 4, 2007 9:20:34 PM
Why should there be a premium for better fuel economy. Because they have brainwashed everyone into believing this. For years they have been charging more for diesel engines than gas engines because the diesel gets better mpg. They are doing R&D already and it's already built in to the current cars price. They did not spend one penny more R&Ding the Volt than they would R&Ding any other new line of vehicles.
Joseph, do you not know anything about the automotive industry, or are you just prone to talking silliness?
Posted by: George | Oct 4, 2007 9:23:08 PM
Joseph's contention is what, that in the long run the demand for gasoline is independent of price? Is there some new underlying demand theory going on here? I'm all ears. :-)
Posted by: Mick | Oct 4, 2007 10:28:18 PM
I want George's pick up truck w/ 3.5 l. diesel and stick shift but can I get a/c and 4x4?
Posted by: Mick | Oct 4, 2007 10:30:55 PM
The "it is so because customers demands it be so" argument also falls pretty flat when you observe how GM insisted on shredding their EV1 fleet even when existing customers were offering to buy them while swearing off liability and maintenance. That act alone summarizes the pigheadedness that exists in some parts of Detroit. There are lots of technologies out there, from downsized engines, to lighter vehicles, to better aerodynamics, to lighter metals, stronger aluminum alloys, composites, electric drives. The Partnership for a New Generation of Vehicles designed concept cars, but since Bush canned that program it's like that research never existed. He who controls the present controls the past, I guess.
Posted by: Jim G. | Oct 5, 2007 7:42:27 AM
Joseph,
I agree that most anything can be accomplished. I only disagreed that there would not be a price to accomplish these tasks (which ultimately determine whether or not a manufacturer even bothers to try).
I have a BS EE and work in Product Planning & Development for a manufacturer of communications equipment. Therefore, I deal with specifications, features and needs of the customers versus the production costs, market size, and subsequent profitability. I like to say I'm a translator between the Engineering department and the Sales force.
Posted by: Patrick | Oct 5, 2007 8:17:07 AM
If 2+ tonnes and 3+ tonnes gas guzzler vehicles have become an addicition and are just as bad as cigarettes for our health, why aren't the manufacturers taken to court and be forced to pay for the damages done?
A tobacco style fuel purchase tax (up to $10/gal over a few years) could help to break this type of addiction and pay for some of the damages done.
The make the addiction breaking process more effective, a federal progressive yearly registration fee of up to $1/pound on vehicles over 2000 lbs would help. Light weight vehicles could get a negative registration fee of $1/pound below 2000 lbs.
Driving an F-350, a Hummer or similar monster vehilces would quick become too much of a drain on the pocketbook. Small efficient vehicles and Hybrids sales would jump. Oil consumption and imports would drop quickly. GHG would level off. etc.
Why not....
Posted by: Harvey D | Oct 5, 2007 8:46:20 AM
"do you know anything about the automotive industry"
Does over 200 designs for the automotive industry in 11 years count? Boards for: ECU's, a wide variety of sensors, AC and heating systems,airbag and ABS controllers, stability control, Avoidance Guidance and Nav systems to name a few.
In a world where we compare difficulty level, if taking a raw substrate and processing it to give it a value that will do what you want it to do is a 10. The Bugatti Veyron is a 5 and your family four door is a 2 on it's best day. The Auto industry is the king of designed obsolecence and incremental theory.
If a couple of start-ups can build a SUV for 75k (Phoenix) and a supercar for 100k (Tesla). Big auto should be able to mass produce for 25% the cost. We have robots roaming around on another planet but my family four door can't get 100mpg. It would be funny, if it wasn't so sad.
Posted by: Joseph | Oct 5, 2007 9:26:18 AM
Two comments, one on the macro data in this news item, and one on this thread:
1. On the macro data: I think you do see a clear divergence, and I'm not sure it exactly maps to the economic divergence produced by our unilateral economic disarmament (globalization) and our Hooverite tax policies. I think the divergence is between those that care about their impact, and those that don't.
2. But the other issue is our lack of vehicle choice. And that is something driven by all automakers, and it is not fully a function of consumer decisions. For example, somehow the car manufacturers have resisted CAFE standards for 30 years, but they rolled over when EPA set unrealistic standards for automotive diesels. Why? It was to the domestic manufacturers' benefit, even though it denied consumers a choice of powerplants. But this goes further, and you don't need to see a cozy relationship between government regulators and auto manufacturers to understand this: we don't get a choice of family movers. For example, where is the Honda Civic Wagon and Honda Accord Wagon? Everywhere but here. Why? Honda does not want to be piggish in US vehicle share, so they figure they have only one shot to sell to a customer, and they want to maximize the profit per vehicle. So if you want 5 passengers plus a lot of room, instead of a Civic WAgon at $16,000, you have to buy a CRV at $23,000. Or if you want more room than the Civic, you can't buy the Accord Wagon at $23,000, you must buy eight seats in an Odyssey at $30,000 or in a Pilot at $36,000. If the market really worked, you'd have all those options, and you could easily get 30MPG in the Civic and 27MPG in the Accord.
Instead, we get fewer choices, and the choices that remain are more expensive, weigh more and have larger engines. Terrible outcomes, and it is very clear that the free market does not work in family transportation.
Posted by: Dollared | Oct 5, 2007 11:23:21 AM
The change in the weather (cool enough not to use AC) and probably to a winter blend of gas makes a real difference.
I'm pretty sure winter blends lower fuel economy.
Posted by: jack | Oct 5, 2007 11:49:36 AM
Most posters on this board know less than nothing about economics and the automobile industry. I’m flabbergasted at the ignorance of some posters in this thread.
Here’s a list of facts to contradict some of the absolutely outlandish statements in this thread to date.
1. Toyota makes more money on ANY Tundra model with $5K on the hood than a fully loaded Corolla at sticker price.
2. If Honda could profitably sell Accord Wagons and Hatches in the US, they would be doing so. Honda used to sell both, but they pulled the plug because so few Americans were interested. I personally love wagons and hatches, most Americans obviously don’t, or they would sell better.
3. If no one wanted 15 MPG full size, body on frame SUV’s, there wouldn’t be any for sale any more. This market is shrinking, but the full size and mid size crossover SUV’s seem to be taking their place, much to the chagrin of the eco-Nazis. Even with $5K on the hood, full size pickups and SUV’s are quite profitable. At full sticker price, many compacts and sub-compact are loss leaders.
4. There are dozens of high MPG cars available in the US from many manufacturers; the fact is most Americans CHOOSE not to buy them. Most Americans have no intention of folding themselves and their gear into a subcompact. This is unacceptable to many eco-Nazis, so they want to force their choice of vehicle on everyone else.
Posted by: Yukaburbahoe | Oct 8, 2007 12:45:16 PM
The great tipping point toward higher fuel economy in American vehicles did not come directly from higher fuel prices but resulted from fuel shortage: long lines at the gas pumps, uncertainty of getting fuel at all, hoarding fuel in gas cans. It was having to get back in line so soon after filling the tank that was the killer. Heading home for Christmas in 1973, I was on the 43rd bus for Cleveland out of Chicago that day. The bus station was a zoo, because there was no certainty of being able to get fuel. That day will come again. If the Straits of Hormuz get closed, it will be chaos.
Economists have been slow to grasp the impact of changes resulting from the ever growing increase in income and wealth inequality in the U.S. The middle class is maxed-out and has run out of disposable income. The auto industry, by continuing to focus profitability efforts on high-end cars and trucks, and ignoring basic transportation needs (or even knowing how to make a profit on a base vehicle) is becoming more and more dependent on the top 5% income bracket. That's a limited market.
The company that figures out how to build a profitable small go-fer commuter vehicle which comfortably and safely seats two (plus 2), provides 500 mile range on a 9 gallon tank, and costs under $12,000 will have a killer ap when the next fuel crunch comes.
Let's see -- 50,000 vehicles per year at $7,000 profit each versus 500,000 at $1,500. Which would you chose, and which pumps up the economy and provides more jobs? The auto industry has forgotten that cars are a disposable, depreciable commodity. By making cars more expensive, the turn-over time has increased from 3 years to 9 years, resulting in less total cash-flow moving through the system.
Posted by: fred schumacher | Oct 9, 2007 10:59:31 AM
Fred,
Having lived through the gas situations of the 70s myself, I agree. Nothing drives home the idea of a scarce resource quicker than rationing. People would pay $4 per gallon, but as soon as you tell them that they can only have 10 gallons this week, they get upset.
Posted by: sjc | Oct 9, 2007 8:41:15 PM
What I find interesting is the rapid acceleration of sales of B-segment cars here in the USA. The success of the Honda Fit, Nissan Versa and Toyota Yaris is the reason why Ford will have a new B-segment model by 2009 here in the USA and why even VW is seriously looking at selling the next-generation Polo here.
And B-segment cars don't need to be cramped, if you've ever sat in the Fit or Versa (both can seat four adults comfortably).
Posted by: Raymond | Oct 11, 2007 7:33:06 AM
There are plenty of small, inexpensive, high MPG vehicles available today in the USA. The economy compact and sub-compact segments have seen some significant gains in market share due to higher fuel prices. But, most consumers continue to walk right by these cramped, less safe economy cars to buy something larger, safer and more comfortable with far more utility due to more space. The fastest growing segment in the US automobile market right now is the compact crossover SUV segment. This should make most of the far lefties on this board at least somewhat happy.
I love these internet chat boards where people talk about closing the Straights of Hormuz. It’s kind of funny and ridiculous all at the same time. Other than the US or Great Britain, what country has the Navy and/or Air Force to close the Straights of Hormuz? If Iran tried, the US could eliminate Iran’s entire Air Force and Navy within 24 to 48 hours. Even if someone surprised NATO and disrupted shipping by sinking a few ships or laying a few mines, the US Navy would have it reopened in days, a week tops in some kind of bizarre worst case scenario. Do most of you have any idea how superior the US Navy and Air Force are to every other Navy and Air Force on the planet?
P.S.: Iran certainly won’t even try to close the Straights of Hormuz before late January 2009. GW is just itching for an excuse to turn Iran into one great big burning oil slick, and he has the ammo to do it.
Posted by: Yukaburbahoe | Oct 11, 2007 7:38:55 AM
RS,
I agree that personal freedom does not include buying a large gas guzzling vehicle that uses up all of OUR limited resources and pollutes OUR air. That person's freedom stops when they harm others.
Posted by: sjc | Oct 15, 2007 9:33:55 AM
This is unacceptable to many eco-Nazis, so they want to force their choice of vehicle on everyone else.
I bet you're kind of sad that people aren't launching at all this sad chum you're tossing.
Posted by: jack | Oct 15, 2007 9:58:54 AM
good morning.
the cars that harm the environment should be chang by another one less pollution.and i wonder if there any new ideas,like machines working on magnatic fild actually its my idea.or on H2o by separating the o2 from H2.
thanks....
Posted by: sazan | Mar 11, 2008 11:43:39 PM
