New car fuel economy hits record high in March

Ann Arbor, Mich. – Fuel economy for vehicles sold through the end of March hit an all-time high with the U.S. fleet averaging 25.1mpg. But automakers have a long way to go to reach economy standards in time for 2025 regulations.

Since 2007, fuel economy has shot up 21%, hitting record levels each year after decades of stagnation. But the growth rate isn’t nearly fast enough. On a compound annual basis, fuel economy has been growing only 3.2% per year, figures from the University of Michigan’s Transportation Research Institute show. During the 2008 model year, the average car got 20.8mpg. So far, the 2014 model year is averaging 25.1mpg.

Federal Corporate Average Fuel Economy (CAFE) regulations call for the full fleet to hit 54.5mpg by 2025, more than double the current efficiency. Those regulations offer several credits for things such as

changing coolants in air-conditioning systems and using ethanol-burning engines. Still, real-world fuel economy would have to hit about 42mpg to comply with the new standards.

Simply put, the current growth rate won’t get the auto industry to the finish line on time. The 3.2% growth rate would result in 35.4mpg by 2025. To get all the way to 42mpg, cars and trucks are going to have to get about 4.8% more efficient per year.

So expect more radical changes to vehicles such as Ford’s aluminum-bodied 2015 F-150 pickup, more hybrids, more electric cars, and more diesels over the next decade.

Source: University of Michigan Transportation Research Institute