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New-car fuel efficiency at new high

August 3, 2012
The fuel efficiency of new cars on U.S. roads hit an all-time high in the first half of this year, according to research released July 26 by an auto industry analysis firm.
The average rate was 23.8 mpg, up 1.1 mpg over the same period in 2011, said Alan Baum, principal of Baum & Associates in West Bloomfield, Mich.
Baum attributed the improvement to several factors. First, there are more hybrids and plug-in hybrid vehicles. Second, many new gas-powered vehicles are powered by smaller engines than the models they replaced.
Third, the industry is motivated by the government’s standard that will require automakers to achieve a laboratory average of 35.5 mpg by 2016.
“In the past, the way the fuel economy of the cars sold increased was by people reducing the size of their vehicles and in this case, we got a 1.1 mpg increase. That’s a lot in one year, and the primary reason was there was improvement in miles per gallon across the board,” Baum said.
Larger vehicles are getting more efficient at a similar rate of improvement as compact and subcompact cars. Higher mpg benefits consumers concerned about the environment or what they spend on gas. Automakers also are responding to changing consumer tastes.
“Automakers have signed on to the new fuel economy requirements, not because they’re good guys but because it’s good for business,” Baum said.
Luke Tonachel, senior vehicles analyst at the Natural Resources Defense Council, which sponsored the analysis, sees the benefits of better fuel efficiency extending even beyond that. “The standards provide a pathway for innovation that brings more choices for consumers,” Tonachel said. “It brings more jobs to build the technology, and it’s reducing the pain at the pump as well as our nation’s dependence on oil.”
But automotive consultant Jim Hall of 2953 Analytics in Birmingham, Mich., isn’t impressed. “We’re living in a time of increased fuel costs and increased sensitivity to fuel costs,” he said. “Common sense tells you fuel economy will be (a higher) consideration.”
But, Hall warned, “Gasoline is a commodity. It will go down again,” meaning the pump price.