To truly make an impact, plug-in and all-electric pickups and SUVs are needed.

Buyer Preference For Gas-Guzzlers Will Derail Auto Industry’s 2025 CAFE Targets, Say EPA, NHTSA, CARB

In the green car world — especially among electric car fans — Chris Paine’s critically-acclaimed 2006 documentary film Who Killed The Electric Car? has achieved something of a cult status among electric car drivers new and old alike. It tells of the tragic and untimely demise of General Motors EV1, a revolutionary two seat electric car produced under duress by GM at the turn of the last century to satisfy California’s Zero Emission Vehicle (ZEV) mandates. A car which was then brutally taken back from happy, lease customers along with cars like the Toyota RAV4 EV and Ford Ranger EV after companies like GM, Toyota, Ford, Nissan and others successfully lobbied the California Air Resources Board (CARB) to scrap its ZEV mandate.

Fuel economy standards are not where they shoud be. Photo: Tony Webster, CC BY 2.0

Fuel economy standards are not where they shoud be. Photo: Tony Webster, CC BY 2.0

Despite the pleas of those willing to buy the cars outright and keep them on the road — not to mention the massive wait list — every automaker maintained that nobody wanted to buy a fuel efficient, zero emission electric car. It was those claims which caused such an outrage among electric car owners, sullying those names forever in the minds of hardened electric car campaigners like the late Doug Korthof, who continued his protest against GM (and the car he called the “Chevy Volt Hoax”) up until his death in early 2012.

Even today, we’ve become used to the idea that electric cars never took off at the turn of the century because automakers didn’t want them to succeed. Indeed, there are few days that don’t go by when we don’t hear someone — usually a Tesla fan — berating mainstream automakers for not bothering to make or sell sexy, affordable, long-range electric cars.

SUV remain more popular than anticipated.

SUV remain more popular than anticipated.

With the upcoming 200+ mile 2017 Chevrolet Bolt EV, next-generation long-range Nissan LEAF and 2018 Tesla Model 3 electric cars waiting in the wings, the days of making that specific allegation may be soon behind us. But while electric and fuel efficient cars are far more affordable, far more common and far more popular with car buyers than they once were, the U.S. Environmental Protection Agency, NHTSA and CARB have just declared that the U.S. auto industry will miss its hope-for 2025 model year Corporate Average Fuel Economy (CAFE) targets by a wide margin, not because of a lack of technological capability but a lack of buyer interest.

Simply put, as hard as car makers are working hard to meet the 54.5 mpg CAFE standards set for 2025, car buyers are doing the exact opposite, using cheap gasoline as an excuse to buy the largest, most heavily-polluting vehicles they can. Since CAFE figures are calculated by averaging the mean fuel economy of all light duty vehicles sold by an automaker, it doesn’t matter if an automaker sells high numbers of plug-in cars or hybrids: if it sells a larger number of gas-guzzling SUVs and pickups, its corporate fuel economy gets dragged down.

And that’s bad for our environment, our communities, and the auto industry, which has invested billions of dollars in recent years on alternative fuels.

The two agencies made their joint evaluation in a mid-term evaluation report of light-duty vehicle greenhouse gas emission standards for model years 2022 thru 2025, which was published this morning. The report — a regulatory commitment made by the EPA when it established model year 2017 thru 2025 light duty vehicle emissions standards — shows that while automakers are adopting advanced alternative fuel and emissions reduction technologies at an unprecedented rate, buyers are stubbornly opting large SUVs and pickup trucks over more economic models.

Automakers are doing more than ever before to bring efficient cars to market -- but customers aren't interested.

Automakers are doing more than ever before to bring efficient cars to market — but customers aren’t interested.

While the Draft Technical Assessment Report accompanying the mid-term evaluation states clearly that the EPA, NHTSA and CARB believe that the 2025 standards “can be met largely with more efficient gasoline powered cars” and “only modest penetration of hybrids and only low levels of electric vehicles,” it reports that low gas prices mean that fuel economy is less of a concern for car buyers than it was just a few years ago. When gas is under $2.20 per gallon, less than half the price it was less than four years ago, consumers don’t worry so much about driving a car that gets 20 miles per gallon rather than 40 miles per gallon.

Indeed, last month, the average fuel economy for new light-duty vehicles (that’s passenger cars and pickup trucks with a payload capacity of less than 4,000 pounds) sold in the U.S. dropped to 25.3 mpg. And while that’s still better than the 22.4 mpg average for new cars in 2011, it’s a long way away from the 54.5 mpg target set for just nine years’ time.

Unlike the story laid out in Who Killed The Electric Car however, the EPA and its fellow report author agencies say this time the automakers aren’t to blame.

“[Automakers are] adopting fuel economy technologies at unprecedented rates,” the report says. “Car makers and suppliers have developed far more innovative technologies to improve fuel economy and reduce greenhouse gas emissions than anticipated just a few years ago,” it continues, adding that the majority of automakers have been able to meet current standards with either the same or less costs than they had predicted back in 2012.

Are automakers doing enough to sell green models? We'd suggest not.

Are automakers doing enough to sell green models? We’d suggest not.

Yet when the EPA, CARB and NHTSA set the targets back in 2012 for 2017 thru 2025, they believed future vehicle fleets would be a little more biased towards cars, estimating that 67 percent of all vehicles sold by automakers would be cars and 33 percent would be SUVs, pickup trucks and crossovers. That estimate has proven woefully inaccurate. Based on current vehicle mix, the best we can hope for when it comes to CAFE figures, say the agencies, is between 50 mpg and 52.6 mpg by 2025.

While the EPA, NHTSA and CARB say that car buyers and low gas prices are primarily to blame for the lowering of fuel economies, automakers are certainly not without fault. Indeed, take a look at any major automaker’s finance deals and sales events, and you’ll find fuel efficient models and zero emission vehicles at the bottom of the incentive deal pile.

In recent months, we’ve seen pretty much every automaker in the U.S. advertise massive cash-on-hood deals and low finance offers for every concievable model of pickup truck, SUV or family sedan. Plug-in cars and hybrids however, are almost entirely absent from such adverts and while finance offers are often available on these models, they’re not marketed anywhere near as aggressively.

And that raises a very simple question: what will it take for automakers and consumers to stop their love affair with large, gas-guzzlers?

Leave your thoughts in the Comments below.

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  • youpidou

    ” What will it take for automakers and consumers to stop their love affair with large, gas-guzzlers?”
    I think the answer is in your article: money. Cheap gas is attracting people again towards large and larger gas-guzzlers. Only when they will be *really* expensive to own can we hope to see a shift. Not many countries seem to be walking the talk on that one…

  • Martin Lacey

    EPA, CARB and NHTSA have made one simple mistake…. they need to levy charges on manufacturers and end users alike. That is the only way to move toward achieving targets in a logical and structured way. I’m not sure how things are done state side, but in the UK road tax is widening. If you drive a fuel inefficient car you pay more. At the moment EV drivers pay £0 road tax and those who drive big polluters pay £515 per year. I expect over time the higher band will increase to £1k PA.

  • Phoenix Electric Car Driver

    Regulations must impose standards both by average and by car. There is no reason that every vehicle cannot at least have more efficient “hybrid” technology. No vehicle should be allowed that doesn’t have it; imagine a “Prius” truck ( or the Via Motors?).

  • spiritpen

    With the oil companies in firm control of the US government, it is easy enough to read between the lines. The price at the pump doesn’t accurately reflect the true cost of gas vehicles. Factor in asthma, sea level rise, war and ocean acid, and the price goes up just a bit, don’t you think? Doug Korthof was right on and his quest lives.

    I am driving a KIA Soul EV, and after bringing it into my local KIA dealer (who doesn’t carry the EV model), the salesmen are going crazy wanting them. They all agree the EV models would fly off the lot. The CARB are an excellent example of the ‘regulatory capture’ that plagues California. People are screaming for zero emission vehicles from every corner of the nation. We are not fooled by the oilies and the politicians they bankroll. Western States Petroleum runs California right down to the Marine Protected Areas off our coast- hence the fracking offshore and poisoning of our aquifers onshore. Get a clue people- the fight ratchets up!

    Joey Racano, Director
    Ocean Outfall Group
    City Captain, 2016 National Drive Electric Week
    Morro Bay, California

    RIP Doug Korthof

  • Chris

    I think it certainly wouldn’t hurt to use the next generation leaf platform to create a compact crossover version of the car. Small hatchbacks can only sell so well in the US. Even in Europe, we’re seeing the same thing to a lesser extent.

    We obviously should be buying more small cars and less big SUVs, but you have to cater to the market as it is now, rather than trying in vain to convince people small cars are what we need. That will happen eventually, but it can’t be forced.

    And of course the dealers need to be pushing EVs much harder with special offers.

  • dtvconsult

    It would be interesting to see what the profit margin is on the larger vehicles (SUVs & Pickups) versus Hybrids and EVs. For most of the big auto manufacturers, their Hybrids and EVs are on new platforms whose development must be recaptured from sales. Most of the larger vehicles are built on existing platforms or platforms that have changed very little.

    It may be different in California and other CARB states, but here in Minnesota, there are extremely few automobile ads for fuel efficient vehicles. (Nikki alluded to this in her article.) The only auto ads for fuel efficient vehicles that I have seen (and I watch a lot of TV) have been for the Toyota Prius (not the plug-in) and a short run of the 10-second Ford Focus Electric ad.

    While some blame can be placed on buyers, most buyers narrow down their selection with the advertising that they see. While most buyers know about the Toyota Prius, how many even know that Ford sells a C-Max Plug-in Hybrid. The only Ford C-Max that I have seen in a TV ad was in a fast food ad. Outside of Europe, most people have never heard of that model. Believe it or not, Ford C-Maxes are on Minnesota Ford car lots; but Ford never advertises the model in Minnesota. That is not going to make them any more popular with the car dealers when they consider plug-in electric vehicles nearly impossible to sell. For instance, as a Ford salesman, are you going to try to explain a model that the buyer has never heard of; or are you going to push the Ford Explorer or the F-150?

  • jimbo1111

    They should make the 2025 CAFE targets stronger then.

    Also, buyer preference for gas? Is that why this sort of thing keeps happening?

    http://evobsession.com/wp-content/uploads/2016/01/US-Luxury-Car-Sales-Tesla.png

  • Doug Liser

    Just increase gas taxes while reducing other taxes to offset. $1 gallon would probably get a few more efficient cars sold.

    The problem is people have no long term vision. A car can last 10 or more years but cheap fuel could be gone within a year.

  • M Oczakow

    It may take a few years (or more) but once EV surpass gasoline range (and gas prices skyrocket), people perhaps will start test driving EVs enough to realize their technological superiority.
    A wide fast cheep charging infrastructure wouldn’t hurt either.

  • Lawrence Taylor

    To paraphrase a political hack phrase, “How can you afford cheap gasoline?” I have started calling the situation in the Middle East, North Dakota and soon to be in the Ukraine as the Pipeline Wars. By bombing almost 10 countries into oblibion, we are creating millions of refugees. Having incidents such as “terrorist” attacks just come with the price tag of cheap gas. I watched the Polar Portal website anxiously this September and if not for a couple of cooler days we almost had a Blue Ocean event. It will happen next year. The Chukchi Sea has still not developed ice and it might not because of warm Pacific water and waves. Next year this will take over at least 50% of the Arctic sea. This will lead to methane release, higher temperatures for the next several centuries, higher ocean levels and billions of refugees. What will it take for people to wake up? They won’t. They are willing to keep driving these monstrosities until either gasoline goes to $400/Bbl or is impossible to find. Maybe during the protests against Trump someone will decide that doing a Green Revolution doesn’t need an election. I think that communities would do well in buying a fleet of EVs and employing people to replace public transport. This would help with jobs and take those gas guzzlers off the road. What do you think of the EVO concept? I am trying to push for community groups in Germany to invest in them to replace their car sharing vehicles. I think that there should be an offer of cheap EV and buses without Self-Driving capability since we should think of keeping jobs.

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