Since I live just a few blocks away from the Edmunds.com offices, fuel economy is not a big financial concern for me. Sure, I hurt at the pump like the rest of the world but luckily I don't visit the pump too often. And since my pump visits are sparse, I tend to forget how painful they are. As I mentioned in last week's column, I was road-tripping it to Las Vegas, and holy smokes did I feel like I was smacked in the face when I saw my gas bill. Of course the stations on the road to Vegas from Los Angeles know they have a captive audience, so prices tend to be higher, but still...ouch! This got me thinking about fuel economy. As an industry we certainly have made some major progress in this area, but how far have we truly come? Headlines aside, who has really moved the needle? And who hasn't? Since numbers are my game, here are the interesting ones that have come out of the research in trying to answer those very questions.
In March, 24.5 mpg was the average sales weighted fuel economy. This number looks at the fuel economy of what has actually been sold and this analysis goes down to the combined fuel economy at the trim level of each model. So, if all that sold last month were Toyota Prius C Twos, then the number would be 50 (Prius C's mpg figure). Of course, that didn't happen.
This number has shown a positive increase over time, with March achieving the highest number ever. Ten years ago it was 19.4, so the move to 24.5 represents 26% growth over the past decade. Most of this growth has come recently, as the past five years has seen a 19% bump, which is the majority of that 26%. This matches the industry push to produce and sell smaller cars in the past few years. In March 2007, the subcompact car market share was 2.3%, whereas last month it more than doubled to be 5.6% of the market. Of course these numbers ebb and flow to a certain degree with fuel prices, but the long-term trend line shows these vehicles gaining share. This is not to say the only fuel efficiency gains have stemmed from an increase in sales of small cars. If you look at the midsize crossover SUV segment, their average is right in line with the industry at 24.5, which constitutes a 30% improvement over the past five years. This represents the largest gain of all segments. Automakers aren't fooling themselves. They know the American love affair with the SUV is not over, so it's their job to make the fuel economy numbers better.
How have the companies themselves changed? Again, taking the 10-year view, every brand has shown improvement with the exception of Jaguar, whose fuel economy average has actually gotten worse over this period of time. That said, it doesn't have the worst fuel economy averages, an honor that goes to Ram and Land Rover who both tie at 16 mpg. Although looking at their model lineups, it's no big surprise.
So going back to the 10-year window, the biggest movers in the positive direction show a good mix of different brand origins. The top three consist of Toyota, Lincoln and Kia. All brands have shown a 30%+ improvement. Overall, the South Koreans have shown the biggest gain since 2002 with a 29% improvement. On the other side of the spectrum, European automakers have shown the least amount of improvement with a 17% gain.
The chart below looks at the automakers' overall changes in the near term — a one-year window. Toyota is in a good place because of the proliferation of the Prius family, which has led to increased sales. Hyundai is also an interesting case. Although it has a hybrid, it's putting more emphasis on fuel economy improvements on the standard-issue internal combustion engine. Interesting as well that domestic heavyweights Ford and Chevrolet are in very similar positions.
Taking the consumer angle here, when one opts for a more fuel-efficient vehicle, how much saving is there? That's one question every consumer who does this should ask himself. Remember the law of diminishing returns? I know I don't want to, but it definitely applies in the case of fuel economy. The higher your fuel economy is, the less you are saving when you opt to increase your efficiency. If you're shopping a vehicle that gets 15 mpg and one that gets 17.5 mpg, the fuel savings per year is pretty significant. However, going from a vehicle that gets 50 to 52.5 mpg saves you a measly $57 per year. That's barely one decent dinner out.
Fuel cost aside, I like driving to Las Vegas, as there is something therapeutic about driving on the open road. For those who haven't done it, it's a straight shot across the California dessert. Generally, I try to avoid Friday evenings as my open desert road becomes a parking lot full of impatient Angelenos. But, driving the open road in the off-peak hours has its disadvantages, too - namely the California and Nevada Highway Patrol. Interstate 15 becomes one huge speed trap so as good as open road euphoria feels, one has to be vigilant to keep speeds under control...not that I'm condoning speeding. But if you are going to be loose with the accelerator, my tip is not to do it in a Cadillac Escalade. Of the three vehicles I saw pulled over by the Highway Patrol, all three were Escalades. One white, one black and one maroon. No conclusive evidence that vehicle color matters here either. Looking at registrations from 2011, Los Angeles is the second largest Escalade market in the country, with the most Escalade hybrid registrations by a country mile. So even though it might make sense to drive your Escalade hybrid to Vegas (it is a great trip car after all), do yourself a favor and fly. From my unscientific observation, the odds are stacked against you. And that's pretty sad considering you haven't even gotten to Vegas yet.
Do you like numbers too? If so, check out our Industry Data Center
Jessica Caldwell is the Senior Director of Pricing & Industry Analysis for Edmunds.com. Follow @jessrcaldwell on Twitter.