Do Consumers Want 40-MPG Cars?

According to a Massachusetts-based think tank, America is now stuck in reverse when it comes to fuel-efficient vehicles. That same think tank also asserts U.S. consumers want Congress to take action to correct the situation, and it cites its own survey results to substantiate that claim. But after looking at the data one has to wonder if American consumers aren't simply providing "politically correct" answers to the survey questions, since their behavior seems to differ markedly from the opinions reflected in the survey.

What is clear is that the number of vehicles that achieve a combined rating of 40 miles per gallon or higher has dropped from five in 2005 to just two in 2007. In an update of its own December 2005 research, the Civil Society Institute (CSI)/40MPG contrasts that decline with the fact that the ranks of over-40-mpg cars rose from 86 to 113 in the same time period overseas. The organization notes that nearly two-thirds (74) of the 113 highly fuel-efficient car models that are unavailable to American consumers are either made by U.S. auto manufacturers (e.g., Ford and GM) or foreign manufacturers with substantial U.S. sales operations (e.g., Volkswagen, Nissan and Toyota).

CSI says the national opinion survey it commissioned shows there is a potential market of at least 2.5 million U.S. consumers thirsting for the fuel-efficient cars now being sold overseas but not in this country. Nearly nine out of 10 Americans (88 percent) think U.S. consumers should have access to the dozens of more fuel-efficient cars available from U.S. automakers overseas but not here. Similarly, more than four out of five Americans (81 percent) think U.S. consumers should have access to the dozens of more fuel-efficient cars available from foreign automakers overseas but, again, not in the U.S.

So it should be obvious that Americans want 40-mpg-cars, right?

The survey numbers say that quite clearly, but the behavior of the American car-buyer says something quite different. In the past, when a greater selection of over-40-mpg models was available on the American market, their combined market penetration was less than one percent of the total U.S. light-vehicle market. It is obvious from CSI's own data that both U.S. automakers and overseas automakers have the technology to build and market cars that get over 40 miles per gallon, and, because the U.S. and global car markets are so hotly competitive, you can bet that at least some of the auto manufacturers would try to exploit the ultra-high-mileage-seeker if they thought they existed in numbers large enough to be a viable market. But up to now, the over-40-mpg market has not tempted them, largely because their market research and prior sales results have told them the market is not nearly as large as CSI believes.

What the organization fails to mention in its analysis of the ultra-high-mileage cars that are available overseas but are not available here is the fact that the vast majority of them are diesels. Diesel-engined vehicles, especially small-displacement diesels such as those used in the foreign small cars not on sale here, have never achieved any popularity in the United States, primarily because of their lack of performance. Diesels have also had a very difficult time passing stringent U.S. smog laws, laws that are so tight that sales of new diesels have been essentially outlawed in highly populated states like California and New York. New, "clean diesel" technology is changing that, but market observers suggest it will take years before diesels reach the level of acceptance they enjoy currently overseas, where government taxation often favors them. 

So while some might argue that automakers are intentionally keeping American consumers from high-mileage cars, the fact is that differing market conditions and the preferences of American consumers themselves, expressed by dollars spent on various vehicle types, are the key reasons we don't see more over-40-mpg cars in America. The intentions of CSI are laudable, but its analysis doesn't tell the real story.

Driving Today Contributing Editor Luigi Fraschini has covered the auto industry for nearly three decades.