Heavier, more powerful and less efficient pickups offset gains in other segments.
When we moved to our current home in downtown San Francisco, we did what you do when you move to the suburbs of the Bay Area. We traded our bus and train passes for an electric vehicle, which we use when we need to be green, and a dirt-shredding SUV, which we use to haul stuff into the Sierras for skiing and going to Costco. I get entirely justifiable and regular doses of stinky eye from grad students and co-workers when I show up to work in the wrong car. My son made me buy offsets (good job Noah and now I know who Mr Beast is).
When my kid asked me if big cars got worse in fuel efficiency or better, I went on a rant about CAFE rules and got a blank stare. In order to understand what really happened to the fuel economy of the new vehicles, these two car geeks got super excited about the EPA’s release “Automotive Trends Report” just before the holidays. This is the authoritative document on how new model years compare to previous model years – by manufacturer and vehicle type. So we dug in and learned some things that surprised even this seasoned data consumer. Here are four stylized facts that I took away from reading this excellent report.
1. Since 2005, CO2 emissions from new vehicles per kilometer have fallen by 24% and fuel consumption has increased by 32%!
Source: EPA Automotive Trends Report.
Although these improvements do not match those recorded after the oil embargo of the mid-1970s (partly due to the adoption of the CAFE standards in 1975), they have more than compensated for the sharp stagnation in these indicators from 1987 to 2005. There has never been a fleet of new, more efficient models on sale since we started logging data. High fives.
2. The biggest improvements in fuel economy come from the fastest shrinking segment – the sedan (followed by small SUVs).
Source: EPA Automotive Trends Report.
If you care what we should care about – the total amount of gasoline consumed, you would want to calculate the vehicles sold multiplied by their fuel efficiency. [Yes,what really matters is how much they are driven, but the EPA does not know that.] Above, the light blue area shows how sedan production has been decimated by manufacturing and demand for small (cars) and large (trucks) SUVs. The only thing that has remained roughly stable is the volume of vans and their fuel economy since 1985.
3. Weight gains were disproportionately concentrated in the pickup truck and SUV segments.
Source: EPA Automotive Trends Report.
The average vehicle has gained 3% in weight since 1975. There was a sharp drop in the late 1970s, followed by a more or less steady increase since the early 1980s. It’s like the human diet medium – you lose a lot of weight doing Keto no matter what, then gain it back, then some. Regular sedans lost about a quarter of their pound in the late ’70s, but recovered about half before leveling off over the past 15 years. Large SUVs grouped from 1985 to 2005 have lost quite a bit of that weight over the past decade. The segment with the shocking weight increase is pickup trucks (“what happened Max – did you eat all the fries?”). The weight growth trend appears to have leveled off, but the average pickup truck today is 28% heavier than the average pickup truck in 1975.
4. Cars today are ridiculously more powerful than cars from the 1970s.
Source: EPA Automotive Trends Report.
The average vehicle saw an 80% increase in power, but this increase is the largest in the pickup segment with a 143% (!) increase in power. We could create a story about the vehicles used by contractors and landscapers, but I have a feeling that a lot of those van miles are transporting people to and from jobs inside or getting milk at the store. These horsepower increases translate to a whopping 50% reduction in 0-60 times for pickups as they burn about the same amount of gas per mile as they did in the 1980s. Vroom!
If we put it all together in one picture… Wait, I don’t have to. The great people at EPA did it for us. The figure below shows us that for all new vehicles, cars and trucks, the fuel consumption has increased significantly compared to the cars of your parents (and maybe your grandparents), while they have decreased somewhat. bigger and heavier, and massively increased power
Source: EPA Automotive Trends Report.
This gain in both power and fuel economy is impressive. The report breaks this down by manufacturer and also talks about the technologies that made it possible (these aren’t your granddads’ turbos! Lots of power for small, fuel-efficient engines. Hybrids? PHEV?).
What does this mean for the future? Just as we’ve been able to clean the air while growing the economy, we’ve been able to make vehicles more efficient, while increasing what consumers apparently crave: horsepower. I’m confident we can preserve the fun and 0-60s you’ve grown accustomed to, while making the cars much more efficient. Indeed, new rules [Link] require manufacturers to do so.
Part of that change will happen by making a lot more electric vehicles, but part of that change will happen by making the old combustion engine and hybrid engines much more efficient for a while. For example, there’s a ton of excitement about the new Ford Maverick. Built on a car platform, but looks like a truck, and the hybrid version gets 42 mpg!
I’m supposed to end by lamenting that CAFE isn’t economists’ favorite regulation, but you already know that, so I’ll spare you the raised eyebrow.
