The hullabaloo around hybrids and electric cars to meet the government’s mandated 54.5 mpg by 2025 might be little more than a lot of meaningless noise.
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Top 10 Automotive Stories of 2012
With a heavy heart the staff of AutoGuide.com say goodbye to 2012, along with its triumphs and tragedies. We await the New Year with open arms, and welcome its promise of a better world.
According to the Chinese zodiac, 2012 was a year of the dragon, and it proved to be the stuff of legend, but thankfully it wasn’t a fire-breather. The Mayans were flat-out wrong; their doomsday prophecy was about as accurate as Bernie Madoff’s promise of a sound investment opportunity.
Still, the year brought other significant stories. Scientists at the Large Hadron Collider in Switzerland discovered a subatomic particle consistent with the legendary Higgs boson. Astronaut Neil Armstrong, the first person to walk on the moon, passed away, and in a brutal political battle Barack Obama won a second term as president of the United States.
Of course the automotive industry made its share of headlines throughout the year. Here’s a rundown of the Top 10 stories from the past 12 months.
It wasn’t so long ago that diesel engines conjured images of black smoke belching trucks with exhaust stacks sticking out the sides.
Likely behind countless sleepless nights among the world’s automotive engineers, the Obama administration’s mandate for improved fuel efficiency was expected to take effect yesterday, but the gun remains unfired.
Fuel economy numbers are more important now than ever before, as gas prices continue to rise in North America.
An impressively high number, even a class-leading car like the Hyundai Elantra, which gets 40 mpg highway, only achieves an average of 33 mpg. While the exact fuel economy figures have yet to be released and a 40 mpg highway rating is still in sight, when the Dart (above) goes on sale later this year it most certainly will not get 40 mpg average; not in real world driving and not even on the window sticker.
Dodge wasn’t wrong. They’re not even entirely to blame. If fact, they were just using a different testing method to get their fuel economy numbers. Or to put it more accurately, they weren’t even doing the testing. So why would a different testing method be used? It’s a long and complex story, but the gist of it is that according to a government mandate, in order for Fiat to take control of Chrysler it needed achieve three goals, the final one being building a 40 mpg car on American soil. Being government related, that number is a CAFE number, not an EPA number. What’s the difference? Read on.
Every new car has a bit of paper full of numbers stuck to it. No, not the price tag, the other piece of paper… the EPA label.
Displaying the car’s rated fuel economy, these numbers can make or break a car buyer’s decision. Ever wonder how those numbers are determined? Read on.
When a car is released, the manufacturer provides its own fuel economy numbers. These are tested in-house and can vary from manufacturer to manufacturer. Many drivers don’t get the same numbers that the manufacturer says they should. It’s the government’s job to set them straight. However, due to the high number of cars released, only about 15% of the vehicles are actually tested.
Just when CAFE loosened standards and lowered from 56.5 MPG to 54 MPG by 2025, the California Air Resources Board (CARB) has decided to propose new and more stringent conditions for automakers that sell cars in California. The California Air Resources Board will not only enforce CAFE, but will also require at least 15.4 percent of all cars sold by any major automaker in the state to either be fully electric, plug-in hybrid, or hydrogen fuel cell by 2025.
Mary Nichols, chair of the California Air Resources Board, observes 15.4 percent as, “a relatively modest goal, but that’s all that we’re mandating. Probably the most heartening aspect of this whole rulemaking was the level of cooperation that we received from the industry… Overall, the degree of support for the package was just extraordinary.”
It is worth noting that earlier this month, researcher LMC Automotive discovered that hybrid sales in the United States have decreased in 2011 to 2.2 percent compared to 2.4 percent of all vehicle sales in 2010. These numbers are far below the proposed 15.4 percent mandate. Despite high profile unveilings of gas-electric products at auto shows across the world, consumers find the cost premium of owning a hybrid over conventional combustion engine vehicles too expensive.
According to the California New Car Dealers Association, this plan would cause automakers to increase the average price of a new vehicle by an estimated $3,200 in order to develop technology that will accommodate the new rules. Appropriately, Mary Nichols also said, “direct incentives to people who buy these cars (like) rebates and credits” are also being worked out.
California’s new regulation will likely be adopted by an additional 10 states, resulting to the projected total number of advanced green vehicles near three million total units by 2025, 1.4 million of which would be in California.
Hyundai might still be under fire by consumers that aren’t having such stellar mpg results with their Elantra, but the Korean automaker had no problems announcing that they’ve achieved the 36-mpg corporate average fuel economy four years ahead of the US government’s rule for 2016.
Hyundai America CEO John Krafcik refuses to step down from the claim that the Elantra is able to achieve its 29/40-mpg claims in the real world, despite owners and even the media stating otherwise. Last month advocacy group Consumer Watchdog petitioned the EPA to re-test the Elantra while Hyundai has been reaching out to unhappy Elantra owners through its dealers to help educate them on their driving patterns and how to increase fuel efficiency.
“I don’t fully understand some of the accusations, but part of it is due to the fact we’re doing better in the marketplace now, and people are aware of and know Hyundai a little bit better than they did a few years ago,” he says. “Probably every car in every car maker’s lineup has people complaining about the real-world fuel economy they’re getting.”
[Source: Wards Auto]
Corporate Average Fuel Economy targets for 2015 and beyond mean that all automakers selling vehicles in the US need to find a way to improve fleet efficiency without facing the risk of hefty fines.
For luxury automakers, traditionally seen as standard bearers of large displacement engines, this has meant a radical re-think when it comes to engine technology. Audi‘s flagship sedan, long recognized as a home for V8 power, is now joining the fray, with two downsized engines, a 3.0-liter supercharged V6 and later a 3.0 diesel in the works.
This will mark the first time that either engine has been offered in the A8, though with some 333 hp and 325 lb-ft of torque on tap, the V6 supercharged should prove no slouch.
As for the diesel, not much information is currently available, suffice to say that it will likely differ in power output from the European version due to emissions requirements for oil burners here in the US (at present the engine is undergoing certification). Stay tuned for further developments.
GALLERY: Audi A8L 3.0T
Hyundai CEO John Krafcik will keep his company’s focus on being a fuel economy leader, and has ruled out a high-performance sports car, even as he discussed the various ways in which the new CAFE regulations can be gamed to produce low fleet fuel economy ratings.
With large vehicles being held to less stringent standards under CAFE (as well as a different formula for measuring MPG than the one used for consumers), Krafcik said that auto makers may not have as strong an incentive to produce compact, fuel efficient vehicles.
Giving the full-size truck market as an example (full-size trucks will be able to comply with more lax regulations) Krafcik told Ward’s Auto that “every well-intentioned action has an unintended negative consequence. This is a classic one. Because of the new CAFE guidelines, the most fuel-efficient segment for pickup trucks, the small ones, aren’t going to be available in the U.S. market. That’s crazy.”
While Hyundai had the best fleet average fuel economy of any auto maker in the 2010 model year, Krafcik said that hitting the 2025 target of a 54.5 mpg fleet average will be tough. Krafcik also ruled out the idea of a high-end sports car, stating “… it would be expensive, and what would it really do for us?”
[Source: Ward's Auto]
Most automakers have gotten in line with the White House and accepted (even welcomed) the new CAFE regulations. Not Volkswagen. In fact, they criticize the new CAFE standards as being biased towards trucks—which of course, they don’t build.
The proposal “places an unfairly high burden on passenger cars, while allowing special compliance flexibility for heavier light trucks,” according to a statement from Tony Cervone, vice president of communications for Volkswagen America. Furthermore, “the largest trucks carry almost no burden for the 2017-2020 timeframe, and are granted numerous ways to mathematically meet targets in the outlying years without significant real-world gains.”
Long story short, Volkswagen fears that manufacturers will find ways to skirt the CAFE regulations by building larger vehicles and classifying them as trucks, rather than finding ways to improve the mileage of their current lineup. The largest vehicle in VW’s lineup is the Touraeg, which luckily for them counts as one of those larger trucks (along with the Routan minivan, somehow).
VW’s point isn’t new: classifying smaller vehicles as light trucks to cheat efficiency regulations is something every manufacturer is guilty of, and hell, it’s basically what kept GM and Ford alive during those dark days of the early 2000s. But VW finds itself outspoken when raising this matter, as every other major manufacturer has supported the government’s new CAFE standards. Will VW hold its ground?
Toyota, Honda, and Nissan all support the White House’s revised CAFE standards, but still view market response as an obstacle.
All three companies dabble in hybrids or electric vehicles, so it’s less of a surprise that they’re willing to accept these higher standards. All three CEOs of their North American divisions have issued statements, to the extent that they see this increase as a challenge.
“Honda embraces this new challenge and we welcome the competition we will have with other automakers that will result from these new standards,” said John Mendel, vice president of sales for Honda America, “because it will benefit both our customers and the health of the planet.”
“Obviously, there is still a great deal of uncertainty as to how the market will respond and what vehicle technologies consumers will embrace, which is why we are rolling out and testing a range of alternative fuel options,” said Jim Lentz, president of Toyota USA.
“Nissan is a company built on innovation and we’re up to the task,” said Scott Becker, vice president of Nissan America, as he cited the Leaf and upcoming Infiniti M Hybrid as examples of Nissan’s “multifaceted approach to meeting consumer demand for increased fuel economy.”
The White House announced earlier that it would be lowering its CAFE standard from 56.5 MPG to 54. The proposal, however, won’t be finalized until Friday—and until then, the White House is looking towards automakers to approve the change.
Automakers have yet to officially endorse the new limits, but many are expected to favor any CAFE lowering. Despite this, German manufacturers such as Volkswagen, BMW, and Mercedes-Benz still oppose even the new regulations, at the potential cost of stiff penalties if they don’t accept these terms and conditions.
These terms and conditions are still the same, of course: passenger cars will have to improve their mileage 5% every year from 2017 to 2025; by 2016, the average mileage standard across the industry will be 35.5 MPG.
[Source: Left Lane News]
After much debate, the White House has lowered its CAFE target for 2025 from 62 MPG to 54.5.
The original 62 MPG figure has been dragged through the dirt before, having previously been lowered to 56.2 before this current figure. But now, the 1.7-mpg drop helps ease the concerns, however slightly, expressed by the auto industry that this annual mileage increase will drive up the cost of cars and destroy car sales as well as manufacturing jobs.
The CAFE situation dictates that cars will have to be 5% more fuel-efficient every year, from 2017 to 2025. On the one hand, the National Highway Traffic Safety Administration believes that this would add $2,100 to a car’s base price. On the other, according to the Consumer Federation of America, with the earlier 56-mpg revision consumers would save over $6,000 in gasoline costs throughout the car’s lifetime.
As you can tell, even with a revised CAFE target the debate won’t be over anytime soon.
Given current and future proposals for Corporate Average Fuel Economy standards it probably isn’t surprising that General Motors is focusing on gas mileage when it comes to new product offerings.
Having launched a spate of new passenger cars recently, including the Cruze and Sonic, GM is now turning its attention to trucks, with new full-size pickups due in 2013 for the ‘14 model year, followed shortly by big SUVs and a small crossover for GMC, known as the Granite.
In an effort boost fuel economy, in order to come into line with the 35.5 mpg CAFE regulations, its likely the new generation of big trucks will feature GM’s new eight-speed automatic transmissions as well as turbocharged engines and eAssist light hybrid technology.
Besides the trucks, other new vehicles in the pipeline include a baby Cadillac, the new ATS, along with a XTS sedan, as well as new vehicles for Chevrolet, such as the Korean built Spark mini car and the updated 2013 Malibu mid-size sedan.
[Source: Automotive News]
Back in September, the US Department of Energy, in conjunction with Nissan Motor Co, green lighted a proposal to test a Cummins four-cylinder turbo-diesel in the full-size Titan pickup.
The program was largely conceived to help big trucks like the Titan achieve better fuel economy, in lieu of the 35.5 miles per gallon CAFE requirements (that now also include light trucks), scheduled to be phased in in 2015.
The test engine, a 2.8-liter unit cranks out 350 lb/ft of torque at 1800 rpm making it comparable with the Titan’s existing 5.6-liter V-8. However substantial gains in fuel economy have already been achieved, the diesel is said to currently allow a 2WD Titan to achieve around 28 miles per gallon, a sizeable improvement on the V-8 truck’s 13/18 mpg (city/highway).
Cummins says this new diesel can be built in either 2.8 and 3.5-liter forms and thanks to the use of high strength steel pistons, is not only a sturdy engine but also rather compact by diesel standards, not that compactness is of real concern when installing one in a Titan.
The test program is scheduled to run through September this year and it will be interesting to see what further results develop when it comes to capability and fuel economy. However, regulators are now proposing even tougher fuel economy standards for 2025, as much as 62 mpg. With such shifting targets, in such a short period time, the ability of any pickup truck manufacturer to meet them is going to prove challenging at best.
[Source: Automotive News]
Auto industry legend Bob Lutz may no longer be in the employ of the Big Three, but that hasn’t ever stopped “Maximum Bob” from giving his two cents on what the industry could do improve upon At the New York Auto Show, Lutz held court for a handful of journalists and expanded on what he felt were the key failures of the domestic manufacturers.
Lutz first fingered the CAFE (Corporate Average Fuel Economy) regulations for helping to give import manufacturers an advantage. While American car makers had perfected the large, rear-drive V8 formula, CAFE forced them to switch to smaller engines and front drive platforms – precisely the kind of vehicles that the Japanese automakers had perfected. Lutz also blamed the typical villains, such as the press, the UAW and foreign exchange rates, but didn’t hesitate to chastise managers of the Big Three automakers, with Lutz deriding the ”… Harvard Business School-type, profit-optimization thinking as opposed to customer excellence focus,” as a key culprit.
[Source: Automotive News]
A House of Representatives committee introduced a bill that would stop the EPA from regulating greenhouse gas emissions from motor vehicles from the year 2015 onwards, a key part of a national fuel economy program that is actually favored by many automakers.
While the bill was supposedly passed in the interest of keeping vehicle prices low for consumers, automakers have previously backed a single unified fuel economy system, rather than various state-by-state regulations. The automakers have not commented on the bill, introduced by House Energy and Commerce Committee Chairman Fred Upton (R-MI), but reiterated their support for a national program. Upton’s bill would leave NHTSA as the sole federal agency that was responsible for the program.
[Source: Automotive News]
With automakers currently struggling to meet the 35-mpg Corporate Average Fuel Economy standards set in place for 2016, the thought of a 62-mpg CAFE number for 2025 is unimaginable by many. That 62-mpg number, the result of a proposed 3 to 6 percent increase in fleet fuel economy starting in 2017, has just been delayed.
Yesterday the Environmental Protection Agency (EPA) and National Highway Traffic Safety Administration (NHTSA) said any further decisions about the 2017 to 2025 goals would be put on hold until September of 2011, citing the need for further study.
One major consideration is that in the fight to increase fuel economy, one of the best ways is to reduce vehicle weight. While advantageous in certain respects, it may also have a negative effect on vehicle safety.
Part of a larger plan by the Obama Administration, the added cost to each vehicle required to achieve these numbers could range from $770 to $3,500 – a number that has been contested by opponents. Proponents of the plan say the up-front cost added to cars would result in cost savings for consumers who would save between $5,700 to $7,400 in fuel costs over a four year period.
Automakers, which had previously been open to increasingly strict fuel economy rules, have now changed their tune, believing they have a more sympathetic ear with Republicans, who are beginning to take over power in the House.
Of note, it’s important to point out that CAFE and EPA fuel economy ratings are not the same and that a 62-mpg CAFE number, is more like 43-mpg in the real world. While more realistic, the only cars on the market that currently achieve such high fuel economy numbers are the Chevy Volt and Toyota Prius.
[Source: The Detroit News]