Friday, May 27, 2011

Pass/Fail on Grading Cars

New Car Labels for Efficiency, Emissions

~ The Environmental Protection Agency and the US Department of Transportation have released details on the new fuel economy labels for cars. While the addition of dollar costs and some kind of emissions information are good steps, the labels are not just stuck on the car, but remain stuck in the past.

New US DOT car efficiency label

The new labels are intended to provide information about the efficiency and impacts of different models. They continue the use of a prominent overall miles-per-gallon measure as well as variants for city and highway driving. Added are dollar figures that try to quantify actual costs, based on a gas price of $3.70 per gallon. Newly included are ratings that place each individual car model in a range based on its fuel economy, greenhouse gases and smog emissions.

The biggest problem with the labels is that they are designed for internal combustion engines that consume fossil fuels. Normalizing vehicles on miles-per-gallon clearly fails when considering plug-in electric vehicles and some of the hybrid vehicles, especially those, like the Chevy Volt, that are designed to only use gas beyond the range of the batteries. All-electric vehicles are added by imputing that they get 99mpg (equivalent). All of the large numbers on the label lack strong meaning for the vehicles of the future.

Using a fixed cost for gasoline is also lame, but perhaps unavoidable. The inclusion of a QR code is a smart addition, as it allows buyers to use their handheld devices to get cost information specific to their location.

The original plan, strongly opposed by car manufacturers, was to use letter grades from A (best) to D (worst). Such a system had the virtue of simplicity, but perhaps overly so; who would buy a car graded D or perhaps even C? Little wonder it was scrapped for something with lots of measures and enough ambiguity to allow consumers to convince themselves to buy anything they might otherwise want.

What's needed, especially with the QR code, is to standardize all vehicles on dollar cost per mile driven. Miles per gallon is just a proxy for cost per mile anyway, and cost is ultimately what matters. Including costs over 5 years based on 15,000 miles driven per year just muddies the picture, and making these figures only a comparison to the "average" vehicle further obscures the actual cost.

No comments:

Post a Comment