Fuel Economy Rises for First Time in Months

Kia topped the WardsAuto Fuel-Economy Index for the first time, as new cars and light trucks sold in July combined for a 23.7 rating, a 5.3% gain over year-ago.

John Sousanis, Director, Information Content

August 16, 2012

2 Min Read
Fuel Economy Rises for First Time in Months

Despite falling fuel prices and increased truck sales, theWardsAuto Fuel Economy Index rose for the first time in four months in July, as market share shifted toward auto makers with higher ratings.

The average fuel economy of light vehicles sold in the U.S. rose to 23.7 mpg (9.9 L/100 km) in July, up from 23.6 mpg (10 L/100 km) in June. The index had declined in each of the previous three months, after attaining a record 24.1 mpg (9.74 L/100 km) in March.

The average price of a gallon of gasoline in the U.S. fell below $3.50, for the first time since January, but that seemed to have little short-term effect on the market.

Light trucks outsold cars for the first time since December. But both cars, at 27 mpg (8.7 L/100 km), and light trucks, at 20 mpg (11.7 L/100 km), registered higher index ratings in July than in the prior month, as sales shifted to more fuel-efficient segments.

Small cars accounted for 19.6% of light-vehicle demand in the month, the segment’s highest market share since April, while earning a 29.5 index rating.

Midsize cars grabbed their lowest share of the year, falling below 21% for the first time since January, though the segment’s 26.9 index rating was notably higher than June’s 25.6.

Cross/utility vehicles led all segments with a 24.3% share of the market, earning a 22.2 rating that tied the sector’s second-best showing on the index to date.

The index’s upward movement came as sales shifted from North America-based auto makers to Asia/Pacific-based companies.

General Motors earned its third-lowest share in history – 17.5% of LV sales – as Detroit auto makers collectively ceded 3.3 share points from June to July, while averaging 21.1 mpg (11.1 L/100 km).

Asian auto makers, with a combined index rating of 25.9, were the chief beneficiaries of the shift, grabbing 47.1% of the market, up nearly three share points from the prior month.

The Europeans accounted for 9.7% of sales, with an index rating of 23.0.

Kia topped the WardsAuto FEI for the first time, at 26.87 mpg (8.7 L/100 km), narrowly edging out Toyota, averaging 26.86 mpg (8.7 L/100 km) and South Korean sibling Hyundai, registering 26.8 mpg (8.8 L/100 km).

Volkswagen finished in the No.4 spot, leading all European auto makers at 26.7 mpg (8.8 L/100 km).

July’s index rating was a 5.3% improvement over year-ago’s 22.5, which came as Toyota and Honda struggled with extremely low inventories of some of their best-selling and most-efficient vehicles.

The industry year-to-date rating held steady at 23.8, up 4.6% from like-2011 and 13.8% better than the WardsAuto Fuel-Economy Index base of 20.9 established in fourth-quarter 2007.

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John Sousanis

Director, Information Content, WardsAuto

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