The New York Times editorial writers are convinced that we can consume a lot less oil and solve GM’s and Chrysler’s problems if the automakers made smaller, lighter cars:
Between 1980 and 2006, the average fuel economy of the American fleet of cars and light trucks gained only 15 percent, according to calculations by Professor Christopher Knittel of the University of California, Davis. From 1980 to 2004, passenger cars’ horsepower increased 80 percent, on average. Their weight increased 13 percent. And the share of the sport-utility vehicle market grew from 20 percent to 51 percent. Mr. Knittel concluded that if the fleet hadn’t become heavier and more powerful, it could have achieved a 50 percent gain in fuel economy on the same amount of technical progress.
He estimated that the average economywide fuel efficiency of 35.5 miles per gallon by 2016 that automakers agreed to with the Obama administration is eminently feasible assuming technological change continues at the same pace. Automakers would only have to cut the weight and power of the fleet back to where they were in 1980. Or they could change the car/truck mix back to where it was in 1980 and trim weight and power a little. This trick doesn’t require new gizmos.
The American automakers did not make large, heavy cars out of a perverse desire to consume ever-increasing quantities of oil. They did so because the could make a profit selling big, heavy cars because that’s what Americans want to buy.
I can only speculate as to why that is. It may be that Americans commute longer distances than their British or Japanese counterparts. The United States is about 3,000 miles across at its widest point; Britain is about 300 miles across at its widest point; Japan’s main island, Honshu, about half that.
There is a complex of policies that support that behavior by Americans that include low gasoline taxes and the deductibility of interest paid on home mortgages. If we want to change the behavior we should change the policies. Demanding that U. S. car companies make cars that Americans don’t want to buy while subsidizing them when they don’t make money is looney.
When I was at a monster truck show a few weeks ago, enjoying the smell of burning fuel, oil and rubber from the dodge, ford and chevy trucks, I wondered to myself, who is going to make the monster trucks that Americans want to watch?
Seriously though, in 1980, there were 1.61 vehicles per household and last year there were 2.28. The numbers lag an increase in the number of persons per household working. For households with 2 or more vehicles, one of them is most likely going to be a truck. It’s quite likely that as the passenger car has shrunk, it’s facilitated the market for a second vehicle to haul people or stuff. So how do you get back to 1980 without reducing the number of vehicles, ignoring the changing gender dynamics, or encouraging the “one vehicle” to be a big, honking truck?
Big reason why US car companies stressed SUVs is that their labor cost structure and level requires larger vehicles, more expensive and with less price-sensitive buyers and less competition and therefore more pricing power, in order to be profitable. Selling an $18K small car against everyone in the world could not be done profitably given the UAW contracts. Govt wouldn’t allow them to import their European or Asian or Australian brands to meet help meet CAFE because CAFE applies separately to domestic and foreign-made, so all they could do was try to go up-market and up-size.
CAFE killed the large station wagon, but SUV’s are treated a slight trucks and subject to a lower CAFE standard, so that was the only avenue open to them, short of taking crippling strikes and ongoing labor problems that they weren’t willing to do.
So we have the govt favoring the UAW and at the same time forcing the automakers into an untenable economic position.
Also, no mention how smaller vehicles are more dangerous to their occupants, to the tune of CAFE causing probably 10,000 or more deaths per year.
Marty brings up a good point: the growth in trucks, particularly in light trucks, is an artifact of the CAFE system. They’re exempt.
Good points on the trucks, Marty.
I blame a good deal of it on the CAFE system, obviously – they tried to change the end result (big cars using lots of gas) directly, rather than attacking the incentives that led to that situation (decades of cheap gasoline).
I, too, agree with Marty’s observations. Of course, such government disfunction is par for the course. And so I can’t resist: Government run health care anyone? But I digress.
People want what they want. And what I want, and what I have, is a 911 that’s damned fun to drive. And so it is with boaters, private flyers, SUV drivers, people who want to fly on vacation, take cruises…………….. etc, etc etc. Oh, and disingenuous Hollywood types flying around the world on private jets while bemoaning global warming………..and petulant losers in Presidential elections as well.
In any event, if you believe we should dictate the car to drive, then I can’t see how you wouldn’t feel the same power to dictate the food we eat, the house we live in, where we live, the clothing we wear, the profession we seek…………….
Brett, I’d argue that Jevons Paradox is real. Some of the fuel money saved by more efficient vehicles is converted into more miles driven.
Average miles traveled per vehicle:
1980 = 9,500 miles
2006 = 12,000 miles
Using my above figures, that means the averages miles traveled by vehicle per household is:
1980 = 15,295 miles
2006/2008 = 27,360 miles
By Jove, PD, you’re right!
Not to mention that, inflation adjusted, (and hysterical left wing Cheny hating oil conspiracy boneheads aside) gasoline is cheaper than in 1980.
Funny, huh? Economics is alive and well.
That’s why they should have just steeply raised gasoline taxes back in the 1970s rather than implementing the CAFE system. People could then go, “Ooh, I like that car! Oh, but do I really want to spend $200 in gas a week (assuming it’s a real inefficient one in terms of mileage)?”
I understand, Brett. That is absolutely the way economic incentives work.
By the way, and I know you won’t mind. I’m recently converted to a “pure life style.” Here’s what it means for you. I’ll be pushing for a tax every time you pick yer honey’s locks. Wasted resources, you know. You should be contributing that valuable time to the public good, not self centered pleasures. I’m thinkin’ $5K a crack, uh, so to speak.
I know you will be supportive of my virtuous endeavor.
😉