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Automotive News & Views Has CAFE reached the end of its usefulness?
507 messages, Last post on Oct 27, 2009 at 11:49 AM
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Replying to: nippononly (Apr 02, 2009 8:43 am) I wrote about my experience 2 summers ago in an earlier post. I was visiting one of the caverns in Virginia and they had a small auto museum next door. They had models from the beginning of the era through the 40's and 50's. The interesting thing is some of the cars built in the 20's and 30's got 20+ mpg. I'm sure that was at a constant speed on flat land but it leads me to believe that maybe we have gotten all we can get out of the internal combustible engine. I would think we would be farther along 80 to 90 years later. |
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Replying to: kdhspyder (Apr 02, 2009 8:24 pm) The Zeta-based cars are not body-on-frame. They use a rear-wheel-drive layout, but they also use unibody construction. Same with the Chrysler 300 and Dodge Charger and Challenger. kdhspyder: The vehicles you noted as being the strengths of the D3 are in fact their weaknesses. The muscle cars do create a buzz in enthusiast circles. Agreed. But when those 12 enthusiasts buy their vehicles the vehicle maker is left with a near empty plant that can't be filled because the huge majority of the population has no interest whatsoever in these dinosaurs. The D3 can't make profits by being specialty boutique builders of low volume muscle cars. That was a luxury for a different time in the 70s when they dictated the market. Now the buyers dictate the market. The Mustang was selling over 100,000 units annually. It has only recently dropped in sales because Ford is getting ready to unveil a new one and the market for ALL vehicles is down (Toyota is offering incentives on the Prius). The Pontiac G8 is a sedan; it's not a "muscle car." It can be used as a family hauler. The G8 flopped because: a. GM hasn't bothered to promote it; and b. it is being sold as a Pontiac, which is a dying brand. It should have been sold as a Chevrolet, which would have given it a much larger dealer body and immediate tie-in with Chevy's trucks and the Corvette, not to mention the upcoming Camaro. kdhspyder: In the meanwhile over the last 25 or 30 years we've saved billions of gallons of fuel not burned up and kept $25 to $50 Billions here at home instead of donating it to Big Oil, Saudi princes, Venezuelan dictators and Iranian terrorists. All the while during those years especially in the 90s GM was raking in $Billions in profits. Making vehicles more economical only makes them cheaper to drive, as long as gasoline prices stay low (which they did until very recently). Gasoline use continued to climb. It was only within the last year that gasoline consumption actually dropped. The average annual mileage per vehicle in the U.S. climbed from under 10,000 miles in the early 1970s to over 12,000 miles by 2006 (the latest year for which I could find figures). Even that trend is deceptive - there are more vehicles per household. So more people are driving, which results in fewer miles being added to an individual vehicle every year, but still ups the overall number of miles driven (and amount of gas burned). The total number of miles driven had continued to increase until the double whammy of $4-a-gallon for unleaded and the collapse of the housing bubble reversed the trend last year. kdhspyder: Now what was bad about CAFE again? It didn't work, and it also caused some unintended side effects (namely, the shift to trucks and SUVs after the death of large, rear-wheel-drive passenger cars).
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Replying to: grbeck (Apr 07, 2009 12:19 pm) The DOT did a Vehicle Miles Travelled study from the late 70's through 2001. As you noted the average driver drove just under 10000 miles at the beginning. By 2001 the average driver was driving about 14000 miles annually. But again as you noted there are far more drivers on the road now. New vehicle production in the late 70s was 10 MM units annually. Before the recent crash it was running at 16 MM units annually. The average fuel economy of the fleet pre-CAFE was 12+ mpg. Now in 2007 it's 25 mpg. If CAFE had not be instuted there would have been no 'stick' to force the vehicle makers to offer more fuel efficient vehicles. As shown by their recalcitrance to push fuel economy over the last 25 yrs, the D3 have never been on board until the last 12 months. If there was no CAFE we likely would still be driving the vehicles of the 70s getting 12+ mpg. However we benefit from CAFE by the fact that now the fleet which is probably three times as large as in 1970 is also twice as efficient. In this last statement is the genius of the whole concept that the detroiters and naysayers refuse to understand. The math is clear. 1970 10 MM units x 10000 mi driven / 12 mpg = 8 Billion gallons used for that MY 2007 16 MM units x 14000 mi driven / 25 mpg = 9 Billion gallons used for that MY The number of vehicles has increased by 60%; the miles driven has increased by 40% but the fuel used has only increased by 12%. That's success. IF...CAFE had never been implemented our increased population and increased number of drivers and increased distances driven would mean that in 2007... 16 MM units x 14000 mi driven / 12 mpg = 18.7 Billions of fuel that would have been used with no CAFE regs in place. But that's only one year. Nearly 10 Billions of gas saved. CAFE has been in effect for 25 years!! 20 years have been at current levels. If we consider that the total US market is 2/3 USED and 1/3 NEW each year that means that the savings are tripled. In fact there are about 250 MM units on the road now in the US. All of these 250 MM units are more efficient due to CAFE. Clearly the numbers support the continued success of CAFE, whether the D3 hate it or not. It's been good for the country.
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Replying to: kdhspyder (Apr 07, 2009 5:32 pm) I totally disagree. I don't see how you can say CAFE did much of anything. It was the oil embargo of 1973 that got people to looking for better fuel economy. Then the super high gas prices of the early 1980s catapulted the high mileage imports into the arena raising the overall average mileage. The two largest auto maker were still building and selling mostly gas guzzlers. My 1988 GMC PU was a 3/4 ton 4X4 that got about 14 MPG. My 2005 GMC hybrid PU which was a 1/2 ton 2WD got 15-16 MPG. I don't consider that an improvement. CAFE is and has been a total waste of tax payers money. Just like all the rest of the programs Congress has cooked up to pad the pockets of their lobbyist friends.
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Replying to: kdhspyder (Apr 07, 2009 5:32 pm) That is pure conjecture. The swing to smaller vehicles began in 1965. Imports were increasing in sales, and intermediates were displacing full-size cars even before the first fuel crunch in late 1973. Even compacts experienced revived sales in the early 1970s (after declining throughout most of the 1960s). People were seeking improved fuel economy even before the first fuel crunch. kdhspyder: If there was no CAFE we likely would still be driving the vehicles of the 70s getting 12+ mpg. However we benefit from CAFE by the fact that now the fleet which is probably three times as large as in 1970 is also twice as efficient. This is not supported by sales trends at that time. People were moving from larger cars to smaller ones even before the first fuel crunch. Note that the Vega, Pinto and Gremlin debuted during 1970, or three years BEFORE the Arab Oil Embargo hit in late 1973. Detroit felt the need to respond to increasing small car sales. The swing to smaller cars was well underway by the late 1960s (we'll ignore the quality of Detroit's responses). kdhspyder: Clearly the numbers support the continued success of CAFE, whether the D3 hate it or not. It's been good for the country. I've read the Congressional debate surrounding CAFE, which gives insight into the intent of the law. The goal was to REDUCE oil consumption and cut oil imports. Gasoline usage is at record levels, and oil imports have increased since the late 1970s (when CAFE went into effect). Clearly CAFE has failed in its original mission.
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Replying to: gagrice (Apr 07, 2009 5:47 pm) You cannot tell me that this has not been worthwhile. That's HUGE money staying here in this country every year. It may not stay in your pocket because of your choice of vehcles but when you consider 250 MM vehicles on the road as a nation we benefit enormously. Your two examples indicate the recalcitrance of the D3. But because of this refusal to adjust by embracing fuel economy they find themselves in the condition they're in. Karma.
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Replying to: grbeck (Apr 08, 2009 6:08 am) It's not conjecture. We ( all three of us ) have lived through these times. We know that the D3 have fought tooth and nail to find ways not to comply with CAFE or to stop it ( they succeeded for 15 yrs ) or to find loopholes through it. I understand the marketing reasons for this especially with low fuel prices in the 90s and the seeming endless supply of oil. But the national good was ignored as was their corporate health. Gagrice's two trucks are perfect examples of the D3's refusal to get with the program. This refusal to look into the future has killed two out of the three largest vehicle makers in the world. The swing to smaller vehicles began in 1965. Imports were increasing in sales, and intermediates were displacing full-size cars even before the first fuel crunch in late 1973. Even compacts experienced revived sales in the early 1970s (after declining throughout most of the 1960s). People were seeking improved fuel economy even before the first fuel crunch. Began. But there was no serious effort by the D3 to participate. When fuel dropped back to $1 a gallon all through the 90s the D3 abandoned all efforts to compete in the fuel efficient small cars in favor of the quick buck with SUVs and trucks ( Cavalier and Sunfire vs Civic and Corolla ). kdhspyder: If there was no CAFE we likely would still be driving the vehicles of the 70s getting 12+ mpg. However we benefit from CAFE by the fact that now the fleet which is probably three times as large as in 1970 is also twice as efficient. This is not supported by sales trends at that time. People were moving from larger cars to smaller ones even before the first fuel crunch. Note that the Vega, Pinto and Gremlin debuted during 1970, or three years BEFORE the Arab Oil Embargo hit in late 1973. Detroit felt the need to respond to increasing small car sales. The swing to smaller cars was well underway by the late 1960s (we'll ignore the quality of Detroit's responses). It's supported by history and actual data over the last 25 yrs. This is the job of major companies and governments, to look into the future and see what is likely for the company's health and survival and for society's welfare. In the late 70s and 80 and all through the last 15 yrs the D3 have ignored the signs and fought to return to the 70s. It has killed them in the end. If there were no CAFE throughout the last 25 yrs we'd still be driving the technology of the 70's ( Gagrice example again ) in all our vehicles not just trucks. kdhspyder: Clearly the numbers support the continued success of CAFE, whether the D3 hate it or not. It's been good for the country. I've read the Congressional debate surrounding CAFE, which gives insight into the intent of the law. The goal was to REDUCE oil consumption and cut oil imports. Gasoline usage is at record levels, and oil imports have increased since the late 1970s (when CAFE went into effect). Clearly CAFE has failed in its original mission. This was uncharted territory back in the 70's. Like now much of the rhetoric is political to catch the attention of the populace and the news; "Independence from Mideastern Oil Producers". But in a less emotional and cooler analysis the lawmakers had to face the real possibility that oil might run out at some time. No one except a few visionaries, considered harebrained alarmists, thought that Peak Oil was anything more than a theory. But DOT did commission the VMT study to which I referred in the other post in order to study driving patterns and thus fuel consumption from the late 70s to 2001. The EIA now publishes an annual report on usage and supplies. It's clear now that we are walking a dangerous line between doing as we please and potentially parking our vehicles for extended periods for lack of petro-fuel. The numbers I mentioned from the VMT study combined with the CAFE numbers clearly show how much money we've saved over the last 25 yrs. It's hundreds of $Billions. The reasoning for the new CAFE 35 in 2020 is not to 'Free Us from Middle Eastern Oil" as the headlines might have read in the 80s. The only way to do that is to stop using petro-fuel for vehicles. Electric power and bio diesel are the only ways to 'free us'. What CAFE 35 recognizes is that for the next 30 yrs or so we will still be using petro-fuel primarily to power our vehicles. But soon that fuel will be so scarce that we ( each of us or the various governments ) will have to ration out the supplies to each user. When that rationing occurs who will be the first to agree to park their vehicle for a week or a month or to retire it forever? Somebody will have to do without. Right now our population is 305 MM people. There are about 250 MM 'eligible' drivers and there are about 250 MM vehicles on the road right now. In 2030 we will have a populatin of about 400 MM people. At the same rate of 'eligibles' there be about 325 MM drivers at that time. Even if our individual VMT don't change from the current 15000 annually that still means that we will need 30% more fuel in 20 years then we use today. Or.... all the vehicles can be 35% more efficient across the board. This is a national security and public safety issue primarily; i.e. keeping us all driving, keeping the military fueled, protecting our economy and keeping us all from killing each other at the pump.
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Replying to: kdhspyder (Apr 08, 2009 6:58 am) The idea that we would all be driving around in 12 mpg vehicles without CAFE ignores trends that were underway before the first fuel crunch. Small cars were growing in popularity BEFORE 1973. People were seeking more economical cars before the first fuel crunch. You need only to look at the sales trends from the middle of the 1960s. Big cars were declining in market share. The growth was in small, imported sedans, ponycars (until they got too big and powerful by chasing the muscle car market - then sales collapsed, which further proves the point) and intermediates. Many people were demanding smaller cars before the first fuel crunch. A lot of them were already upset about the "economy" of the standard-size Detroit cars. kdhspyder: It's supported by history and actual data over the last 25 yrs. This is the job of major companies and governments, to look into the future and see what is likely for the company's health and survival and for society's welfare. In the late 70s and 80 and all through the last 15 yrs the D3 have ignored the signs and fought to return to the 70s. It has killed them in the end. If there were no CAFE throughout the last 25 yrs we'd still be driving the technology of the 70's ( Gagrice example again ) in all our vehicles not just trucks. This ignores the impact that the imports have had on the market since the 1970s. They were the main drivers of technological changes in the market, and their presence was completely independent of CAFE. kdhspyder: But the national good was ignored as was their corporate health. Gagrice's two trucks are perfect examples of the D3's refusal to get with the program. Many people who bought large cars simply switched to large trucks, because CAFE killed them. Are GM, Ford and Chrysler supposed to not make a type of vehicle just because some people think it uses too much gas? Both Toyota and Nissan entered those markets, too - also note that, as of last year, Toyota sold MORE trucks, SUVs and large vehicles (meaning Camry and above) than smaller cars (and that includes the Scions). kdhspyder: This refusal to look into the future has killed two out of the three largest vehicle makers in the world. What killed Chrysler was Daimler looting the company, and skimping on new models to the point that they were hopelessly uncompetitive (Sebring and Avenger). What killed GM were several factors: a refusal to get serious with the UAW about bringing labor costs (including work rules) into line with the transplant operations; a refusal to realize that the old Sloan "stairstep" model of branding was dead; and a refusal to realize that it was behind the competition in critical areas of interior quality and control of noise, vibration and harshness (what we call "refinement"). A Prius clone or a Cobalt that gets 40 mpg would be nice, but neither would have saved GM or Chrysler. Big pickups and SUVs kept GM alive to this point. Without them it probably would have gone under in the early 1990s (GM almost filed for bankruptcy in 1992-93). Making more fuel-efficient vehicles wouldn't have saved GM. Note that Toyota is offering incentives on the Prius, and the Fit is piling up on dealer lots, too (my local Honda dealer has at least six, along with three of the new Insights). Even if the Cobalt and Aveo were as good as the Civic and Fit, they wouldn't be enough to keep GM in business. CAFE can only ensure that the manufacturers make vehicles that obtain a certain mileage figure. It can't ensure that said vehicles will be attractive, refined, fun or desireable. A look at a 1976 Chevette or 1982 Cavalier - both built in response to CAFE - should be proof enough of that one... kdhspyder: The numbers I mentioned from the VMT study combined with the CAFE numbers clearly show how much money we've saved over the last 25 yrs. It's hundreds of $Billions. The rationale for CAFE keeps changing. Originally it was supposed to end the dependence on imported oil and reduce gasoline usage; when it didn't do that, the rationale was that without it we'd be using even more gasoline, because otherwise every new car would only get 12 mpg. That ignores trends that have been underway since the 1960s, so now CAFE is supposed to save us money. That would certainly be nice. Except, of course, that the technology needed to make vehicles that get 35 mpg and provide the same levels of comfort, refinement and safety may drive up the price of vehicles to the point that no net savings will be realized. So those savings are hardly guaranteed. kdhspyder: But in a less emotional and cooler analysis the lawmakers had to face the real possibility that oil might run out at some time. No one except a few visionaries, considered harebrained alarmists, thought that Peak Oil was anything more than a theory. Were they the same ones who said that we would be paying over $5 a gallon for unleaded by this time? I paid $1.99 a gallon last night... kdhspyder: But soon that fuel will be so scarce that we ( each of us or the various governments ) will have to ration out the supplies to each user. When that rationing occurs who will be the first to agree to park their vehicle for a week or a month or to retire it forever? Somebody will have to do without. Rationing has nothing to do with "shortages" and more to do with making sure the politically connected get what they want at the old price. If the price goes higher, people will have to adjust. If they can't afford, they will do without it, or drastically reduce their use of it. Last year provided the perfect example. Gas prices rose, and gasoline usage dropped, as did the number of miles driven...all without any change in CAFE. If gasoline does become scarce, it will become more expensive, which, in turn, will encourage pumping more difficult-to-access reserves, more use of alternative energy sources and more conservation measures (carpooling, trip consolidation, use of mass transit, etc.). As shown by the past year, CAFE is completely irrelevant to those trends.
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Replying to: grbeck (Apr 08, 2009 8:53 am) I don't have any trust in the 'goodness' of industry to do the right thing for society. Industry should not have improving society as it's first goal, profitability should be the first goal. As such the D3 were ( in the short term ) absolutely right to try to maximize profits and ignore CAFE as much as possible. That's capitalism. But for the long term health of the various companies and for the betterment of society industry 'should' be looking long term. Obviously they haven't. But luckily for us the government has a longer view. We will need at least 30-40% more fuel available to us by 2030. It's got to come from somewhere or a lot of us will have to do without. The petroleum industry says that the easy oil, the low-hanging fruit, is all but gone. While there's plenty left it's all in remote areas where it's going to cost a lot to bring it to the pump. Or we all can do without to some amount or other. Again who's going to volunteer to be the first to sit at home or to take mass transit? Your shortterm view on the price of fuel today is indicative of the very common 'forest and trees' syndrome. It's what got the D3 in the mess they're in presently. Absent the economic crash this year I viewed fuel prices as increasing by $.50 a gallon annually out into the future. I don't see anything except the current lack of business demand around the country that dissuades me from this long term outlook. At some time we will recover and we will start back to work with minimal unemployment and our appetite for fuel will take off again, with booster rockets. At that time $4 and $5 per gallon fuel prices will return. Then we will again be facing annual increases of $.50 a gallon as fuel gets tighter and tighter. So I ask again, 'Who will volunteer to be the first to park their vehicle, stay at home or take mass transit?' With a larger population, more drivers and more vehicles on the road we must have 30-40% more fuel for our needs....or we can drive vehicles that are 30-40% more efficient. Will industry do this on its own? Not until it sees demand and money to be made. With a 5+ yr design cycle and multiple products involved by the time industry sees the demand it will be too late for society. That's where government steps in. 1. Make the national fleet more efficient by 2030 to keep everyone driving 2. Mandate fuel rationing 3. Mandate against single person vehicles 4. Mandate against drivers of certain ages ( none >75 or <18 ) Allowing industry to 'react as demand dictates' is as bad as 'let the markets decide' in our financial crisis. When the crisis hits it's too late.
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Replying to: kdhspyder (Apr 08, 2009 11:20 am) I implied no such thing, and please note that the Vega, Pinto and Gremlin all debuted in 1970, BEFORE CAFE was enacted. The domestics were attacking the small car market before CAFE was enacted. (Whether they were good efforts is another matter, but there is no evidence that CAFE has resulted in the production of GOOD vehicles.) Even Ford had made the decision to downsize the original Mustang to create the Mustang II prior to the first fuel crunch. The market was moving to smaller vehicles before the Arab Oil Embargo. That doesn't mean that people were going to immediately abandon Cadillac Fleetwood Broughams and LTD Broughams, but it shows the direction the market was already heading. kdhsypder: The two examples of half-azzed efforts to bring smaller more fuel efficient vehicles to market, the Chevette and Cavalier, show this lack of involvement. You claimed that higher mileage vehicles would have forced the production of more attactive and economical vehicles, and thus prevented GM and Chrysler from reaching the point of bankruptcy. The Cavalier and Chevette prove that mileage standards cannot force a company to make attractive cars - only economical ones. That is not enough to prevent bankruptcy. kdhspyder: But for the long term health of the various companies and for the betterment of society industry 'should' be looking long term. Obviously they haven't. But luckily for us the government has a longer view. Except that GM and Chrysler are still basically bankrupt, which means that CAFE didn't do much good in preventing that one, and Toyota now can't sell Priuses without incentives, so merely making high-mileage cars is obviously not enough to boost sales. kdhsypder: We will need at least 30-40% more fuel available to us by 2030. It's got to come from somewhere or a lot of us will have to do without. The petroleum industry says that the easy oil, the low-hanging fruit, is all but gone. While there's plenty left it's all in remote areas where it's going to cost a lot to bring it to the pump. Which will initially be reflected in the price...and please note that there is no proof that all of our additional energy needs will be met with petroleum. kdhspyder: Your shortterm view on the price of fuel today is indicative of the very common 'forest and trees' syndrome. It's what got the D3 in the mess they're in presently. Absent the economic crash this year I viewed fuel prices as increasing by $.50 a gallon annually out into the future. I don't see anything except the current lack of business demand around the country that dissuades me from this long term outlook. The price of gasoline was declining before the current economic crash. It was based on a commodity bubble and the resulting speculation, not any true shortage in supply. kdhspyder: At some time we will recover and we will start back to work with minimal unemployment and our appetite for fuel will take off again, with booster rockets. At that time $4 and $5 per gallon fuel prices will return. Then we will again be facing annual increases of $.50 a gallon as fuel gets tighter and tighter. I recall similar predictions in 1975 and 1982...didn't work out that way. Gasoline was supposed to hit $3 a gallon by 1985 (in 1980s dollars). Although I don't doubt that gasoline will eventually hit $4 a gallon. Of course, if, in 1980, someone had told me that, in 2009, a brand-new Civic would cost $20,000, and a decent house would cost between $180-200,000 in the area where I live, I would have said, "No one will be able to afford one!" Because I made the common mistake of forgetting to account for increases in income and purchasing power.
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