State of the Union: Where do federal fuel economy and greenhouse gas emissions targets actually stand?

Federal fuel economy and greenhouse gas emissions standards for new vehicles sold have had a huge impact on light duty passenger and medium-to-heavy duty vehicles being built and sold in the US. Consumer Federation of America (CFA) is hopeful that the 54.5 mpg by 2025 target for passenger vehicles can be met, though some automakers are lagging way behind their peers. A new study by CFA calls out a few of the automakers for dragging down the numbers. The dramatic drop in petroleum fuel prices over the past year is also having its impact on new vehicle sales numbers with truck and SUV sales climbing. Where does all of it stand in terms of hitting these ambitious federal corporate average fuel economy (CAFE) standards?

Analysis by the CFA states that from 2014 to 2015, the percent of vehicles with a US Environmental Protection Agency (EPA) fuel economy rating of at least 23 mpg increased from 50.5% to 52%; the percent of vehicles with fuel economy at or below 16 mpg declined from 8.5% to 6.1%. CFA says that some automakers are performing very well on improving fuel economy (Volvo, Honda, and Mercedes-Benz), while other automakers are doing poorly (Kia, Subaru, and General Motors) based on making progress in increasing the number of models they’re making and selling that comply with the year’s CAFE standard.

In reviewing 2015 models, CFA found that the biggest jump was in the 27-30 mpg category, which improved from 14.8% to 16.5% in 2015. The Ford F-150, which had a 2014 fuel economy range of 13-19 mpg, jumped to a range of 17-22 mpg in 2015 through switching to a lighter aluminum body. “There is no doubt that since the announcement of higher CAFE standards, many car companies have improved their selection of vehicles with greater fuel efficiency, proving that 54.5 mpg by 2025 is achievable. The fact that the number of cars getting over 23 mpg has risen by almost 40 percent in the last ten years is strong evidence that reaching the goal of 54.5 mpg by 2025 is indeed attainable,” said Jack Gillis, author of The Car Book and automotive expert for CFA.

Automakers are focusing more on increasing sales of light duty truck and SUVS lately. CFA found that the percentage of CAFE-compliant light trucks and SUVS declined significantly in 2015, bringing the percentage of CAFE-compliant from 66% to 44%. The University of Michigan’s Transportation Research Institute that the actual fuel economy of new vehicles sold in the US in April 2015 was 25.2 mpg, versus 25.4 mpg in March 2015 and 25.3 mpg in April 2014. The high point was reached in August 2015 at 25.8 mpg. Gasoline and diesel prices had begun their spike by that point and took their toll, with truck and SUV sales increasing along with their used vehicle values.

Margo Oge, former director of EPA’s Office of Transportation and Air Quality and author of “Driving the Future: Combating Change with Cleaner, Smarter Cars,” along with Mary Nichols, chairwoman of the California Air Resources Board, earlier this month wrote a guest column for The Detroit News calling on the federal government and automakers to avoid weakening the federal standards.

“The recent dip in gas prices has led some to suggest that automakers should shift back to supplying more of the large and less fuel efficient cars and trucks that were popular with consumers a decade ago…… This is exactly the wrong time to take our foot off the accelerator of advancing technology. It is time to embrace the transformation of the automobile and harness the environmental and economic benefits of the industry’s shift towards safer, greener, and ‘connected’ vehicles,” they wrote.

Sergio Marchionne, the CEO at Fiat Chrysler, raised the issue in January when he said that while automakers could reach the 54.5 mpg target, he doesn’t think that year is a realistic timetable to accomplish it. “The question is whether 2025 is a realistic date for which to achieve it,” he said.

Other industry executives have joined in, citing cheap gas prices, mediocre support of alternatively fueled vehicles and the technology limitations as obstacles that make a fleet average of 54.5 mpg unattainable. On the commercial vehicle side, truck makers are anxiously awaiting phase two of federal standards for heavy-duty vehicle fuel economy and emissions. The proposal is expected to be published in June, three months later than its initial target.

Plug-in electric vehicles have played a “behind the scenes” role in automakers reaching fuel economy targets, as they’ve achieved credits in the federal program for selling more zero-emissions vehicles. President Barack Obama has relaxed his ambitious target of seeing one million plug-in electric vehicles on US roads by 2015. In March, the president scaled back that goal originally laid out in 2009; federal fleet purchase goals were scaled back in March, too, according to a Bloomberg article. Obama cut government purchase goals about two months ago, but said the government will continue to work to improve fuel economy into the future. “Presently, commercially available electric and hybrid vehicles do not align with the most purchased vehicle segments for federal fleets” which are trucks, GSA said in a statement. “They also come with a higher acquisition cost compared to conventional vehicles.”

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