Posts Tagged ‘CAFE’

Post-Election Musings

November 25th, 2012 Comments off

Now that the 2012 elections are behind us, and the pundits – of both the left and right persuasions – are backwards-analyzing everything that was said and done, and how it culminated in the slate of political “leaders” that will take us forward for the next several years, it’s also an appropriate time to take a look at things from an automotive perspective. Below are a few random thoughts, including statistics which may be completely made up.

What you drive says a lot about who you voted for. And I don’t simply mean the Obama/Biden or Romney/Ryan sticker on your rear bumper. For example, in the Presidential election, more than 100% of Volvo wagon drivers voted for President Obama. Similarly, nearly every Toyota Prius driver went with the incumbent. On the other hand, Mitt Romney captured the vote of 3 out of every 4 Ford Mustang drivers. The same ratio holds true for Chevy Camaro owners – although the 25% that voted for Obama are all General Motors employees. Cadillac owners voted overwhelmingly for Romney – obviously. And Nissan Leaf owners – both of them – cast their ballot for Obama. Subaru drivers also helped keep Obama in the White House, as that brand is not only a favorite among outdoorsy hippie-types, but also lesbians. Scion drivers? Well, they didn’t vote in this election, since they’re all under the age of 18.

There is a lot of ignorance about where our energy comes from. Especially for our cars. Not long before the election, I heard conspiracy theories every time gasoline prices dipped a bit, proclaiming that the President was manipulating them in order to win the election, as if there were a knob located underneath the Resolute Desk that controls the digits you see on the sign at your local gas station. Gasoline prices are driven, for the most part, by the price of oil, which is a commodity traded in a global market, with prices dictated by supply and demand. The only way to keep gasoline prices low are to (1) increase supply (which is very short-sighted, given that petroleum is a finite resource), and/or (2) reduce demand (which we can do – with significant effort – domestically, but it will likely have little impact due to the expected exponential growth in demand from other countries like China and India, unless they follow suit). The only way the federal government can directly affect gasoline prices is via the federal gasoline tax – which hasn’t changed from the level of 18.4¢/gallon since 1993. (For an honest look at domestic oil production, check out what my smart friend Patrick Bean has to say.)

The partisan fighting extends to the automotive world. On a road trip earlier this year, I was stuck in traffic next to a Ford Mustang Shelby GT500 – an impressive piece of machinery with a supercharged 5.8L V8 making 662 horsepower. And although we were doing the stop-and-roll on I-95 South out of Washington, D.C. averaging about 15 mph, that exhaust sounded so sweet. I was impressed – until I noticed the decal which featured a fat middle finger pointing upwards, with the caption, “F*ck your Prius” in his passenger-side rear quarter window. I’m still not sure what the sentiment is there, unless it’s “I paid twice as much for my muscle-car as you did for your *overpriced* hybrid, and now I’m stuck in traffic going the same speed as you.

CAFE standards will become significantly more impactful through 2025. One of the current administration’s first-term achievements was the issuance of the joint Final Rule for fuel efficiency standards, developed by the Environmental Protection Agency and U.S. Department of Transportation, which will effectively set the fuel economy target of light-duty vehicles at 54.5mpg by 2025. As with most every other signature accomplishment of the current President, from the beginning of the primaries the field of challengers nearly all promised to change course and rid the nation of such “job killing” regulations. But now that there’s more certainty that the new standards will be around for a while, the automakers will start commercializing technologies to meet them. And that’s a good thing.

Climate change, recently pushed to the back-burner, has now fallen off the stove. Four years ago, much of the political discussion was around a price for carbon – whether in the form of a carbon tax or a system of cap and trade. Climate change was becoming a mainstream topic of debate. And while a few actions have been implemented (see CAFE standards above), the topic of global warming has all but melted and flowed down the Potomac out of D.C. Perhaps this is the success of a relatively few climate change skeptics who operate at the fringe? Which would be unfortunate, given that, of the 13,926 peer-reviewed scientific journal articles that related to climate science, only 24 reject the notion of climate change. As I’ve said before, the science is proven – the only remaining question is the degree to which we’ll alter the climate system.

Maybe I should start printing bumper stickers that read, “F*ck your climate.” I expect there’ll be quite a market.


September 10th, 2011 Comments off

Not long after my last post on CAFE regulations (where I mentioned that the White House was leaning towards a 2025 target of 56.2 mpg), the matter was “settled,” at a proposed 54.5 mpg.  (The difference doesn’t amount to much – less than 6/100ths of a gallon of gasoline for every 100 miles that a vehicle travels.  But, the lowering of the goal was enough to get some of the major auto manufacturers to fall in line and support the proposed regulation – at least publicly.)

Behind the scenes, however, automakers and other opponents to tighter CAFE rules complain that the target is too tough, and that it will lead to slow, underpowered cars that people won’t want to buy at significantly increased costs.  Being a realist, I tend to think that – yes, it’s true that new, advanced technology does tend to cost more than the old, but the benefit far outweighs the cost.  On the other hand …

Reading my latest issue of Autoweek magazine, I came across an article about the new Range Rover Evoque, which states that its 4-cylinder engine “generates 240 hp and 251 lb-ft of torque, which is more than the 233 hp and 234 lb-ft from the 3.2-liter six currently in the Land Rover LR2.”  It’s also rated at 24 mpg, vs 17 mpg for the LR2.  Now in this case, the Evoque does come at a premium (approximately $44k as compared to the LR2’s $37k), but it’s a completely new model, in a higher-end segment than the LR2, and you’re paying for more than just a more powerful and more efficient engine.  So …

A few pages later is an article about the new Jeep Wrangler, which gets a new V6 for 2012.  As compared to the 2011 powerplant, Autoweek tells us its “output grows by 83 hp and torque gains 23 lb-ft, to 260 lb-ft.  That blows the old 3.8-liter engine and its 202-hp, 237-lb-ft raings off the trail.  Despite the power boost, fuel economy also increases to up to 21 mpg on the highway.  The base price remains the same…”  More power?  More efficiency?  Same price?  And then …

There’s the next article about the new Mercedes Benz M-class.  Since car mags are so good at telling us what’s changed between the new model and the old, let’s see what Autoweek has to say.  “Power is up, along with fuel economy, in both versions that will be offered at launch in the United States.  The gasoline direct-injection, 3.5-liter V6 ML350 4Matic, with 302 hp and 273 lb-ft of torque, has an estimated fuel economy of 17 mpg city and 22 mpg highway (versus 15/20 mpg in the outgoing model).  The ML350 Bluetec 3.0-liter V6 turbodiesel has an output of 240 hp and 455 lb-ft of torque and estimated fuel consumption of 20/25 mpg (versus 18/25 for 2011).  Pricing stays the same for 2012…”

It’s not like these are isolated, special cases.  Automakers are great at increasing efficiency and power without increasing cost.  They’ve been doing it for years.  It’s just that they’ve been using that ability to make our cars bigger, heavier, and faster, rather than making any significant gains in fuel economy.  As a result, they now have a long way to go to meet upcoming CAFE regulations.

The automakers (well, not all of them) publicly support the new CAFE targets.    My guess is they’ll find a way to comply.  From a fuel consumption standpoint (i.e., the y-axis on this graph), most of the work has already been done.



June 27th, 2011 Comments off

Last month, Autoblog Green writer Eric Loveday wrote about an interview with Bob Lutz – former Ford/Chrysler/BMW executive, most known for his recently-ended stint at General Motors where he retired as Vice Chairman of Global Product Development.  Now, as a car-guy, I’ve always sort of admired Maximum Bob.  He’s a car-guy as much as a businessman, and he oversaw the development of more than a few worthwhile vehicles in his career.  But, he does have some flaws in his thinking, which are painfully revealed in the Loveday interview…

Bob Lutz

Bob’s a climate-change skeptic, and it shows in his opinions related to CAFE regulations and the federal government’s role in the auto industry.  He says of the initial CAFE rules from the 1970’s,The feds basically handed our market to the Japanese.”  He then describes how the American automakers made perfectly desirable vehicles until CAFE came about, forcing the domestic industry to abruptly redesign and re-engineer everything in order to comply.  And since change is hard, American auto quality suffered.  He also blames the State Department for granting Japan a favorable exchange-rate, making American competitiveness even more difficult.  (I’m no economist, but I’m pretty sure the State Department doesn’t set exchange rates.  Am I wrong?)

Bob describes the U.S. federal government as the only one in the world that is hostile to its own auto industry because of the policies it places “against” the automakers, born of what he calls a complete lack of understanding of what is technologically feasible.  He describes a mandate of 42 mpg by 2025 as physically impossible, tantamount to mandating that all cars have to “hover off the highway by two inches.”  (For what it’s worth, 42 mpg is the below the range of what NHTSA has been considering as the 2025 CAFE rule; instead, the agency has been considering improvements of 3%-6% per year beginning in 2017 within the realm of possibility, equating to 47 mpg to 62 mpg by 2025.  Additionally, today the White House “unofficiallyreleased a proposed CAFE target of 56.2 mpg.  I wonder what Bob thinks about that?  …Actually, I’m pretty sure I already know…)

Bill Ford

In contrast, Bill Ford – Executive Chairman of Ford Motor Company – recently spoke at the TED2011 conference, and penned an opinion piece on, describing the global gridlock we face as the number of cars on the planet doubles or quadruples over the coming decades from the nearly 1 billion vehicles we have now.  Bill accurately describes the downside:  traffic jams, squandered time, stifled economic opportunity, and the resulting loss of mobility options and lower standard of living.  He then suggests a few solutions:  better mass transit systems, smart cars, smart infrastructure, and cooperation among corporations, entrepreneurs, NGOs, universities, and governments.  In stark opposition to Lutz’s tack, Ford anticipates the unsustainability of the current paradigm, and envisions possibilities to overcome the challenge.  (Lutz, on the other hand, only envisions external factors as the cause of difficulty for his industry.)

The contrast between these two auto executives – and their view of the world – couldn’t be more apparent.  It’s a good thing for GM that Lutz is now a former executive.