Fuel efficiency rose in 2017, but shows signs of future decline

March 7, 2019

Fuel efficiency among new cars for 2017 hit a record high but appetites for less-efficient crossover SUVs and pickups among new buyers has slowed recent gains among automakers to increase their fleet averages, the EPA said in a report released Wednesday.

The average fuel efficiency among model-year 2017 new cars climbed from 24.7 mpg in 2016 to 24.9 mpg in 2017. Overall, Honda had the highest average fuel economy at 29.4 mpg. Mazda was second with 29 mpg and Hyundai came in third at 28.6 mpg. With their truck-heavy lineups, American automakers anchored the bottom of the list. Fiat Chrysler Automobiles was last at 21.2 mpg on average, while Ford and General Motors tied at 22.9 mpg. 

MORE: GM builds last Chevrolet Cruze, exits compact car market

Since 2016, FCA, Ford, and GM have largely jettisoned passenger cars in the U.S. to focus instead on profitable—and guzzling—crossover SUVs and pickup trucks. On Wednesday, GM built its last Chevrolet Cruze, which effectively pulled Detroit automakers out of the traditional compact sedan market in the U.S. for now. 

EPA Administrator Andrew Wheeler slammed the Obama administration's stringent fuel-economy and emissions standards, which call for about a 5-percent increase in fuel efficiency annually through 2026.

"There are legitimate concerns about the ability to cost-effectively achieve the Obama Administration’s standards in the near future," Wheeler said in a statement. 

The EPA and the Department of Transportation last year proposed looser fuel-economy regulations as part of the Safe Affordable Fuel Efficient Vehicles Rule that would freeze 2020 standards through the 2026 model year for cars sold in the U.S. 

A key component of the Obama-era rules currently in effect are credits that automakers can use, bank for the future, or even sell to one another. FCA was the first automaker to move away from cars when it dropped its compact and mid-size sedans, and it bought the most credits last year. FCA said last month that it paid $77 million in civil penalties for not meeting 2016 model-year requirements. 

BMW, Jaguar Land Rover, Volkswagen, and Mercedes-Benz parent Daimler also bought credits while Honda, Nissan, and Tesla sold the most.

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