Yahoo Autos SUVs and Trucks Kept US Average Fuel Economy Down Last Year
The average fuel economy of vehicles in the U.S. didn’t improve at all last year, Toyota may be rethinking its electrification strategy and the fate of Stellantis’ Illinois Jeep Cherokee plant could be in EVs. All that and more in this edition of The Morning Shift for Tuesday, December 13, 2022.
1st Gear: Treading Water
Sure there are more EVs on the market than there have ever been, but they still comprise a small percentage of overall sales volume. In the meantime, people are buying bigger vehicles — crossovers, SUVs and pickup trucks. Despite technological advancements they’re still not as efficient as cars, partially because they keep getting heavier. So it’s little surprise that average fleet fuel economy in the U.S. didn’t improve at all in 2021, per new data published by the Environmental Protection Agency and reported by Reuters.
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The U.S. Environmental Protection Agency said on Monday the fleetwide real-world average was 25.4 miles per gallon in the 2021 model year, the same as in 2020. The EPA estimates the 2022 fleetwide efficiency average will rise to 26.4 mpg.
Automakers are meeting rising vehicle emissions requirements in part through using credits earned in prior years or by buying excess credits from rivals.
Chrysler-parent Stellantis had the lowest fuel economy among all automakers at 21.3 mpg in 2021, while General Motors was 21.6 mpg and Ford Motor at 22.9 mpg.
The three U.S. automakers had the lowest fleet-wide fuel economy of 14 major car companies, while EV manufacturer Tesla led all automakers with the equivalent of 123.9 mpg.
Subaru, Kia and Nissan followed Tesla as the most efficient brands. That Detroit’s Big Three are bringing up the rear of the pack shouldn’t surprise anyone, as they started purging their passenger cars about four years ago. Stellantis had to buy plenty of credits to make up for all those Hellcats, Demons and TRXs:
The report showed Stellantis led all automakers in buying emissions credits and acquired 102.6 million megagrams of credits in the 2021 model year, while Tesla (TSLA.O) sold 72 million. General Motors purchased 28.3 million credits and Mercedes Benz (MBGn.DE) while Honda (7267.T) sold 50.5 million credits and Toyota (7203.T) 38.9 million.
Automakers are failing to achieve annual 5 percent emissions cuts, choosing instead to market larger vehicles that are subject to less stringent fuel economy standards. That’s one of the big reasons every truck today, midsize or full-size, has four doors now, and why Ford couldn’t sell the Maverick without the hybrid option, as MotorTrend explained last year. The EPA projects that U.S. fleet MPG may go up by one next year, though — so at least that’s something.
2nd Gear: The Best Truck Ford’s Ever Made
Speaking of the good people over at MotorTrend, that’s what they called the F-150 Lightning, which took top honors in the publication’s 2022 Truck of the Year awards.
You can read their rationale on their website, but the crux is that the Lightning drives better than any F-150 before it, while also sliding into the market almost $20,000 below the next-least expensive all-electric competitor. That would be MotorTrend’s 2021 winner, the Rivian R1T. Like the R1T, the Lightning isn’t quite as capable as a gas-burning pickup, but MT doesn’t hold that against it:
In evaluating the F-150 Lightning, we must acknowledge Ford intended this specific model to do a slightly more limited range of jobs. Simply put, the Lightning is not intended to be a long-distance tow vehicle. This is not a failure of Ford engineering but rather a technical limitation of today’s battery technology and charging infrastructure that should improve. It’s a frustrating limitation because the Lightning’s instantaneous torque, regenerative braking, and improved ride and handling make it very good at towing heavy trailers—just not for as many miles as gas-powered models achieve.
On the flip side, the verdict is that buyers get a lot that ICE trucks can’t offer:
Pickup trucks, more than any other vehicle type, are typically bought for what they’re capable of doing should the need arise. They’re the ultimate multitool, able to haul people as comfortably as cargo and trailers. They commute as easily as they go off-road, move furniture as easily as they haul lumber. No serious truck owner is going to give up that kind of versatility just for the ease of refueling at home or the ability to hit 60 mph quicker.
The Ford F-150 Lightning doesn’t require those buyers to make big compromises. In fact, it means only that they not tow for long distances. In return, it offers a host of features no gas- or diesel-powered truck can match. Be it for the campsite, the job site, or the homestead, the Lightning offers up a world of new possibilities for truck owners all while saving them money at the pump and likely at the repair shop, too. It’s a bargain many are going to find exceedingly easy to live with.
The next few years of electric truck tit-for-tat between Ford, GM and Ram are going to be interesting.
3rd Gear: Toyota and EVs
Toyota needs to make sure the successor to the fine BZ4X is more than fine. To do this, it’s taking a little bit more time than it had planned. Courtesy Reuters, by way of Automotive News:
Toyota is expected to outline adjustments to its electric-vehicle strategy to key suppliers early next year, as it races to narrow the gap on price and performance with industry leaders Tesla and BYD, two people with knowledge of the work said.
The automaker is expected to detail the EV plan changes through early 2026, communicating the adjustments to major suppliers, the people said on condition of anonymity as the information is confidential.
Toyota has been looking at ways to improve the competitiveness of EVs being planned for this decade, in part by speeding up the adoption of performance-boosting technologies for planned EVs, from electric drive systems - including motors - to the electronics that convert power from the grid to energy stored in batteries and more integrated heating and cooling systems, the people said.
The changes, however, might include delays to some of the EV development programs originally planned for the three-year period, one of the people said.
The big shift in strategy may result in the premature death of the company’s e-TNGA platform — a version of its core architecture for gasoline-burning cars with tweaks to make it suitable for electrification. Toyota is considering killing e-TNGA, which is just three years old, and fast-tracking a replacement exclusively devoted to EVs. But that’ll still take time.
And so Toyota remains in the difficult position of having to play catch up with its EV repertoire. It probably doesn’t help that the new Prius, which will come as either a traditional or plug-in hybrid, looks way more futuristic and appealing than either the BZ4X or the Lexus RZ.
4th Gear: Jeep Cherokee Plant May Have a Future
However, that future definitely won’t be in building the Cherokee. Belvidere Assembly in Illinois will stop production of the SUV at the end of February and possibly moving that line to Mexico. But Stellantis is assuring everyone that the Illinois plant isn’t necessarily shutting down — just going idle for now, until the company can figure out what to do with it next. From Automotive News:
The Illinois plant that builds the Jeep Cherokee is being shut down in early 2023, but Stellantis North America COO Mark Stewart on Monday said the factory still could have a future.
Stewart, during an event at a Detroit-area plant, said the automaker is “continuing to look at what we can do to repurpose that facility — but it’s idle, not closed.”
Stellantis intends to help workers at the Belvidere Assembly Plant who are being displaced find other positions within the company, Stewart said. The company last week said production will end Feb. 28, with layoffs of hourly and salaried workers there expected to last at least six months.
“We’re also working together with the UAW, and also with the state and local government, to make sure that folks that are on layoff find roles,” he told reporters. “We have many roles here in southeast Michigan and Ohio and Indiana as well, so that folks who want to go to another location during that time to work, those jobs will be available for those folks. It’s really important for us as well as to the UAW that we find roles for those people.”
Belvidere’s future could be in EVs, but it’d have to be retooled first. Conveniently, the Illinois legislature just approved expanding tax incentives to makers of electric vehicles, so there appears to be a path forward opening up for Stellantis, if it wants to take it.
5th Gear: Warren Buffett Keeps Selling BYD
It’s happened again: Berkshire Hathaway has dumped another million-plus shares of Chinese automaker BYD. Per Reuters:
Berkshire Hathaway, the investment company owned by Warren Buffett, has sold 1.33 million Hong Kong-listed shares of electric vehicle maker BYD for HK$267.69 million ($34.43 million), a stock exchange filing showed.
The sale lowered Berkshire’s holdings in BYD’s total issued H-shares to 14.95% on Dec. 8, down from 15.07%, according to a filing to the Hong Kong Stock Exchange on Tuesday.
This happened just a few weeks ago, and even before that, all while BYD is preparing its entry into the Mexican market. Together, Buffett’s firm has sold more than a quarter of its holdings in BYD in just five months. This is almost the only story you ever really hear about BYD anymore, which is strange because it’s not like the company is struggling.
Reverse: Spygate Comes to a Close
It was a different time, when Ferrari could win Formula 1 championships and McLaren, too, was really good. On this day in 2007 per Wikipedia, McLaren issued a press release fessing to acquiring confidential Ferrari documents — a transgression that would ultimately result in the team being stripped of its Constructors’ Championship points from the prior season and a $100 million fine.
On the Radio: Princess Nokia — ‘Versace Hottie’
Credit: Princess Nokia via YouTube
The Need For Speed Unbound soundtrack is really good.
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