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Standard Accommodates Industry’s Downward Slide: NHTSA’s Proposed Light Truck Fuel Economy Standard for 2005 Looks Backward, Agency’s "Improvement" was Met by Big Three in 2000

The National Highway Traffic Safety Administration’s (NHTSA’s) smoke and mirrors projections for light truck fuel economy standards are based on auto manufacturers’ low-ball projections. Rather than setting a mile per gallon (mpg) standard that would challenge the industry, NHTSA’s proposal assumes a dip in the light truck fuel economy for the three major domestic manufacturers between model years 2000 and 2005. General Motors, Daimler/Chrysler and Ford all met NHTSA’s proposed 2005 light truck fuel economy standard of 21.0 in 2000. Instead of advancing light truck fuel economy, NHTSA’s proposed standard will enable manufacturers to further retreat from their 2000 mpg levels. Inexplicably, the agency’s estimates for General Motors assume that they will not even achieve their 2000 level by 2007 – a full three years after the agency’s alleged fuel economy increase is put into effect.

According to NHTSA, decreases in light truck fuel economy for the Big Three domestic manufacturers (General Motors, Daimler/Chrysler and Ford) are in part due to their acquisition of other fuel inefficient vehicle fleets – such as Daimler/Chrysler’s acquisition of Mitsubishi and Ford’s purchase of Land Rover. NHTSA also states that the decrease in fuel economy levels is due to the manufacturers’ disproportionate production of high-consumption light trucks. Yet manufacturers’ plans to continue "super-sizing" gas guzzlers is no excuse for NHTSA to preemptively lower its expectations for future standards. Given the availability of technologies that could improve fuel economy today, there is no justification for manufacturers to backslide on fuel economy. Under the statute, NHTSA is required to set the standard at the "maximum feasible average fuel economy level" that manufacturers can achieve.

In 2000, the Big Three made promises, assuring the public that they would significantly increase their fuel economy for light trucks. Ford announced that it would increase the fuel economy of its SUV fleet by 25 percent over five years and General Motors and Daimler-Chrysler quickly echoed this pledge. If Ford did as promised and increased the fuel economy of its SUVs by 25 percent between 2000 and 2005, that action would net them a gain of 1.8 mpg for their entire light truck fleet by 2005. Once the threat of Congressional action on fuel economy faded, however, the companies backpedaled, in effect retracting these promises of fuel economy promises.

The new Federal numbers used to determine the 2005-07 light truck fuel economy standards are formulated as though the 2000 promises never happened. Using the manufacturer’s projected technological developments and costs, NHTSA estimated 2005, 2006, and 2007 fuel economy levels for the Big Three. In NHTSA’s estimate, Ford will actually decrease its fuel economy by 0.1 mpg between 2000 and 2005 and will only achieve 1.0 mpg increase by 2007. NHTSA estimates also show a decrease in General Motor’s fuel economy of between 0.2 mpg and 1.9 mpg from 2000 and 2007 and a mere 0.8 mpg increase for Daimler/Chrysler over the same period.

With no one watching the store, General Motors, Daimler/Chrysler and Ford will come nowhere close to fulfilling the increase in standards that would have resulted from Ford’s 2000 promise. Rather than challenging auto manufacturers to advance fuel economy, the agency’s proposal will hardly hold them to their 2000 fleet averages.

Light Truck Fuel Economy Standards, Manufacturer Averages, and NHTSA Estimates for 2001 and 2005-2007¹

*Italicized figures represent NHTSA's estimates based on manufacturers' projections.

¹ Sources: NHTSA’s proposals and estimates from "Light Truck Average Fuel Economy Standards Model Years 2005-07," December 16, 2002; 2000 and 2001 figures from Automotive Fuel Economy Program: Annual Update Calendar Year 2001: NHTSA, September 2002; Ford’s 2000 pledge change mpg increase from Union of Concerned Scientists page http://www.ucsusa.org/news.cfm?newsID=303 (visited 1-6-002).

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