Fuel economy event shows consumers have a wide variety of car choices

Consumer Reports News
June 17, 2013

At the Consumer Reports "Fuel Economy: Now and in the Future" event last week, the theme was easy to spot: No matter what kind of car you want, you can find one today that gets good gas mileage. And tomorrow, you'll find one that does even better.

We had 23 vehicles representing all types of cars and trucks and a wide range of prices and fuel-economy technologies in our parking lot for visiting media and dignitaries to check out. They numbered two fuel-cell vehicles, five electric cars (including two Tesla Model S's), two plug-in hybrids, three diesels, two conventional hybrids, and nine "regular" cars that deliver impressive fuel economy. The diversity was striking, with the group counting sedans, SUVs, hatchbacks, all-wheel-drive machines, a sporty coupe, a convertible, and a pickup truck. (Read: "How higher fuel economy standards will save you money.")

To learn more about saving gas, visit our guide to fuel economy.

The cars represent the leading edge of a wave of new fuel-efficient vehicles that automakers are building to meet stringent new government fuel economy standards that are expected to see real-world performance ramp up to 35.5 mpg by 2016 and again to nearly 40 mpg on average by 2025. (Factoring in technology-related credits, the 2025 target is known as the 54.5 mpg Corporate Average Fuel Economy standards.)

The fuel-economy standards represent "the greatest advance in transportation in 40 years," said David Strickland, administrator of the National Highway Traffic Safety Administration. Strickland gave the keynote speech and also answered questions on an expert panel. (See the video below.)

The new targets may represent the greatest advance, but the change may not come easy. "Meeting the 2025 fuel economy standards will require an unprecedented rate of change," said Ann Schlenker, vehicle systems section leader at Argonne National Laboratory in Chicago.

Many media pundits have criticized the standards as a "Trojan horse to get electric vehicles into the hands of consumers," said Stephen Crolius, vice president of the Alliance Consulting Group, who has worked on several electric-car adoption projects. "But it's not castor oil." The EPA's own analysis shows that the agency expects electric cars to make up only between 1 and 3 percent of total car sales, even once the standards are fully implemented by 2025.

Even 1 percent of total sales represent about 150,000 buyers a year, though. To increase current numbers, automakers have discounted prices to sell more about 50,000 electric cars a year. Today, Crolius says, most electric car buyers are motivated by the social benefits. "We need to get people motivated by their wallets," he says.

Indeed, our own testing shows electric cars are very cheap to own. They're about three times as efficient as a typical gasoline-powered car and take just pennies per mile to run. "In dollars and cents, driving an electric car really does make sense," said Jake Fisher, director of auto testing at Consumer Reports. "But their capability needs to be extended."

A report by Consumer Reports that was released in conjunction with the event showed that the technology required to meet the 2025 fuel economy standards could add up to $1,800 to the price of new cars. But that will be offset by about $7,300 in fuel savings over the 15-year average lifespan of the new vehicle, leaving consumers about $4,600 ahead. (Download the full fuel economy study.)

Indeed, among the many new cars that visitors toured at the event, which lead the way in fuel economy gains, most were little or no more expensive than the much less efficient models they replaced, said Fisher.

Counting total cost of ownership, including the federal $7,500 tax credit for electric-car buyers, drivers who drive more than 50 miles a day will already save money over five or six years of ownership by buying an electric car, said Crolius. Add in a $2,500 rebate in California, and the two-thirds of drivers who drive just 40 miles a day can break even over the same ownership cycle, he says.

The incentives expire once their budgets are exhausted. The federal government allocated $400 million toward electric vehicle adoption in 2009 under the American Recovery and Reinvestment Act. And considering the alternative, that may be a good deal. The warmest year in recorded history was 2012, said Judith Enck, EPA administrator for Region 2, which includes New York. And 12 of the warmest years on record have occurred in the past 15 years. Warmer ocean temperatures are associated with stronger hurricanes. And cleaning up the damage from just one of these hurricanes, Sandy, has cost the federal government $60 million, she says.

Clearly, there are many facets to the benefits associated with improved fuel economy. The good news is, we are on the road to providing more cost-effective choices for consumers, while contributing to environmental benefits.

—Eric Evarts

More from Consumer Reports:
2013 New Car Preview
Best and worst used cars
Complete Ratings for 200 cars and trucks

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