March 15, 2011, 2:48 pm
A Lopsided Playing Field to Achieve the CAFE Standard
By DEXTER FORD
http://wheels.blogs.nytimes.com/2011/03/15/a-lopsided-playing-field-to-achieve-the-cafe-standard/?pagemode=printBuilding a Camry to 2016 CAFE standards would cost Toyota roughly $455 per vehicle, among the lowest cost burdens in the industry.
How much will it cost auto manufacturers — and ultimately, consumers — to reach the new Corporate Average Fuel Economy standards, the rules that require all major auto manufacturers to achieve a company fuel-economy average of 34.1 m.p.g. by 2016, up from the current 27.5?
According to estimates from the Environmental Protection Agency, the costs vary among manufacturers. The agency has said that, on average, each car and light truck required $948 worth of efficiency improvements. From that number, the agency subtracted an average of about $4,000 in projected fuel savings over the lifetime of a 2016 vehicle, resulting in net savings of about $3,000 per vehicle owner.
Broken down by manufacturer, however, a very different picture emerges. The E.P.A. estimates it will cost Toyota just $455 per vehicle to reach 2016 compliance, whereas it will cost Volkswagen nearly that amount — $437 per vehicle — just to get its fleet to meet the more modest 2012 incremental efficiency mandate. To go all the way to 2016 would cost the company $1,693 per vehicle. That’s a lot of fahrvergnügen.
BMW is next on the cost list at $1,453 per vehicle, followed by Chrysler at $1,328, Daimler at $1,312 and General Motors at $1,219.
At the low-cost end of the spectrum, Kia is right behind Toyota at $501 per vehicle, with Honda next at $574 and Hyundai at $745.
Why do some makers have such an apparent advantage? It’s not just because they make smaller cars, but, rather, their fleets are already quite efficient.
Any thought that the new regulations are unfair to some manufacturers ignores that some competitors will pay less for upgrades simply because they have already made those upgrades — and have paid for them in research dollars.
From another perspective, the E.P.A. projections simply mirror the realities of the marketplace. With gasoline selling for more than $4 a gallon in some locations, all manufacturers are working, and spending, to improve the fuel efficiency of their fleets.
The E.P.A. estimates are based on a number of published factors, with much of the data coming from the manufacturers themselves. The cost of making the same fuel-efficiency upgrades (more efficient engines and transmissions, better aerodynamics, direct fuel injection, reduced weight, lower-friction oils and tires) is assumed to be the same for all makers.
So, will a Toyota Camry cost $800 less in a dealership than a similar Ford Fusion or Chevrolet Malibu? If Ford and Chevy want those sedans to leave the dealerships, it will not; that’s why the marketplace is called, well, the marketplace.
Abundantly clear, however, is the fact that from now to 2016, some manufacturers must work more overtime than others.
Below is the E.P.A.’s list of average car/truck cost estimates, based on 2007 dollar values, for complying with 2012-16 CAFE standards, sorted alphabetically by manufacturer.
MANUFACTURER 2012 model year 2013 model year 2014 model year 2015 model year 2016 model year
BMW $363 $679 $959 $1,209 $1,453
Chrysler 493 781 1,020 1,171 1,328
Daimler 337 622 871 1,089 1,312
Ford 511 658 768 940 1,228
General Motors 406 572 691 889 1,219
Honda 206 330 439 507 574
Hyundai 273 419 553 656 745
Kia 197 312 386 459 501
Mazda 356 471 559 672 799
Mitsubishi 400 545 685 826 876
Nissan 334 449 537 657 823
Porsche 334 614 825 1,009 1,206
Subaru 419 615 692 762 912
Suzuki 239 432 583 719 855
Tata 295 524 728 913 1,099
Toyota 125 222 312 387 455
Volkswagen 437 794 1,106 1,412 1,693
Overall 331 503 639 774 948
