CAFE May Encourage Larger, Less Fuel Efficient Cars

The Law of Unintended Consequences can cause havoc. Take CAFE regulations, otherwise known as Corporate Average Fuel Economy rules. Begun as a way to encourage higher fuel economy in cars and light trucks after the first Arab oil embargo of 1973, CAFE has become the primary tool to enforce emissions policy considerations developed at the national level.

CAFE regs allow larger LaCrosse to be less fuel efficient

The regulations are more stringent for small vehicles, less stringent for larger ones. There is a good reason for this, according to the EPA. It says larger vehicles are inherently less able to meet higher fuel economy standards because by definition they weigh more and heavier vehicles are inherently less fuel efficient.

“Other things being equal, larger vehicles will emit more [greenhouse gas] emissions and achieve lower fuel economy than smaller vehicles,” Christopher Grundler, director of the EPA’s Office of Transportation and Air Quality, tells Automotive News. “One should not assume that it is easier for a larger vehicle to meet a less stringent numerical standard.”

That may be so, but it raises the possibility that manufacturers deliberately choose to build larger, less fuel efficient cars in order to make it easier to comply with CAFE requirements. “Cars are changing their dimensions in order to take advantage of this, but I don’t think it’s anything new,” says Dave Sullivan, an analyst at AutoPacific Inc. “We’ve been using every available credit or loophole that the system allows for years now.”

Fiat Chrysler has recently decided to stop making it Dodge Dart and Chrysler 200 sedans, which have to meet the toughest CAFE standards, entirely so it can concentrate exclusively on building larger vehicles like the Ram 1500 pickup and Jeep Grand Cherokee. The fuel economy requirement for both is far lower than for the Dart/200 sedans.

The Buick LaCrosse is a case in point. Redesigned for 2017, the new car has a wheelbase that is 2.7″ longer. It is also 1.2″ wider. Those changes raise its footprint — a rectangle defined by the area between the centerpoints of a car’s wheels — to 50.1 square feet. That’s up from 48 square feet for the old car. While that may not seem like much of a difference, it is enough to move the new LaCrosse into a different size category for CAFE purposes.

The new category allows the larger car to get a little over one mile per gallon less and still be in compliance with CAFE requirements. If you think a difference of a mile per gallon or two is no big deal, you haven’t been paying attention. Automakers spend millions of dollars on technology that will boost average miles per gallon by one or two tenths of a mile.

In fairness to the car companies, customers are clamoring for larger cars. The LaCrosse sells well in China where rear seat legroom is a major consideration for Chinese customers. No doubt, most of that 2.7 inch increase in wheelbase went to give passengers riding in back more room to stretch their legs.

The LaCrosse is just one example of the trend toward larger cars. A study by Automotive News found that 21 of 25 vehicles redesigned since the footprint-based standards took effect in 2012 have gotten bigger. Included in that group were cars from all size categories.

The Law of Unintended Consequences means that the CAFE regulations may be encouraging automakers to make cars that are less fuel efficient. “We know it’s having a negative impact on the benefits of the program — bigger footprint means less-stringent standards. A bigger footprint at the redesign process — essentially at no cost — means you get a less stringent standard for free,” says Roland Hwang, transportation director at the Natural Resources Defense Council. “Based on the evidence you have, it requires the regulators to look at this issue more closely.”

The bottom line is that the CAFE system is antiquated and in need of a thorough overhaul. In general, it does a poor job of addressing the issue of carbon emissions from vehicles. Those in favor of market incentives instead of regulations would recommend market-based tools like a carbon fee on fossil fuels to help spur the transition to a zero emissions transportation system. Until then, it seems that we need better regulations.

Source: Automotive News | Photo Credit: Buick (2016 model shown).


Steve Hanley

Closely following the transition from internal combustion to electricity. Whether it's cars, trucks, ships, or airplanes, sustainability is the key. Please follow me on Google + and Twitter.