CALSTART survey of major auto suppliers finds 70% don’t want US to change CAFE targets; split on amount of electrification needed
Major automotive suppliers see national fuel economy standards as important for long-term planning and investment and don’t want to see them altered by US policymakers, according to a first-of-its-kind industry survey commissioned by CALSTART and conducted by Ricardo Energy & Environment.
The firm polled and interviewed 23 suppliers, almost all of them global Tier 1 suppliers that sell parts directly to automakers. According to the survey:
70% of suppliers said policymakers should not adjust the program’s goals.
65% agreed with the decision to set new miles-per-gallon standards for 2025, with 30% saying they strongly agreed with the decision.
Among those who agreed, all but one named regulatory certainty as critical for the industry and half said the standards spark innovation.
59% said that fuel-economy standards help spur job growth.
Suppliers identified a wide range of conventional and electric technology that could be used to meet the standards.
Three quarters agreed that setting targets beyond 2025 is also important for longterm planning.
When presented with a list of technologies analyzed within a National Academies of Science report (earlier post) that might be used to meet fuel-efficiency standards, suppliers picked turbocharging and engine downsizing, along with higher-speed automatic transmissions, as the most critical.
Hybrid technology was also viewed as important, along with variable valve timing, gasoline direct injection, and mass reduction.
Suppliers were split on whether or not meeting the standards would ultimately require more electric vehicles than are already slated to hit the roads under state zero-emissions vehicle requirements.
Deployment of electric vehicles is required under the ZEV mandates that exist in California and various other states (requiring electrification in 15% of new light-duty vehicle sales by 2025, which equates to about 4% of new light-duty vehicle sales nationwide). 29% of respondents indicated that they would expect at least an additional 2% of electrified light-duty vehicles above the ZEV mandate requirements to be necessary to meet the 2025 targets. In comparison, 24% of survey respondents felt that there would be sufficient improvements in ICE technologies, lightweighting and hybridization technologies to meet the 2025 targets without additional electrification.
During the interview, Eaton indicated that achieving the GHG targets is dependent on the level of EV penetration. While the targets are still achievable without a large increase in the EV penetration rate, the targets could be achieved more easily if they were complimented by investments in EV charging infrastructure. BorgWarner suggested that an electrification level of 30% will be needed to meet the targets, which is even higher than the estimate presented by the EPA in the latest midterm report.—Ricardo survey
Although not named in the NAS report, some respondents pointed to 48V mild hybrid/start-stop-coast technologies and P0 hybrids/e-assist as being useful toward meeting the standards.
Earlier this summer, the Environmental Protection Agency (EPA), Department of Transportation (DOT) and California Air Resources Board issued a technical analysis of Corporate Average Fuel Economy (CAFE) and greenhouse gas standards for light-duty cars and trucks, focusing on mileage requirements for model years 2022 to 2025. The agencies will take public comments on the analysis until 26 September, and will formally propose new requirements next year.
Starting in 2008, agencies reformed fuel-economy requirements to make them footprint-based, meaning smaller vehicles have higher miles-per-gallon requirements while larger vehicles have lower ones. Suppliers emphasized that even as all vehicle types become more efficient, consumers are expected to buy more large cars, trucks and SUVs if gas prices remain low.
Overall, federal agencies project a fleet-wide fuel economy average of between 50 and 52.6 miles per gallon under test conditions for the 2025 model year. That translates to an average of 36 miles per gallon in actual on-road performance, which is about what today’s gasoline-powered Honda Fit already achieves.
This survey underscores the degree to which deploying new fuel-efficient technology is already baked into companies’ businesses plans. Companies are clearly ready to innovate and see the upside in the standards—John Boesel, president and CEO of CALSTART