U.S. Consumers Steer Away From Most-Fuel-Efficient Vehicles, May FEI Shows

Vehicles with a 30-plus mpg rating on Ward’s Fuel Economy Index lost 23.5% of their year-to-date market share in the year’s first five months.

John Sousanis, Director, Information Content

June 11, 2010

2 Min Read
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U.S. consumers are shying away from purchasing the industry’s most fuel-efficient vehicles, according to Ward’s analysis of light-vehicle sales through May.

Vehicles earning a rating of more than 30 mpg (7.8 L/100 km) on the Ward’s Fuel Economy Index accounted for 10% fewer deliveries in the year’s first five months, compared with like-2009.

Against a backdrop of increasing sales of light vehicles, high-efficiency cars lost 23.5% of their market share, dropping from nearly 4% year-ago to 3% in 2010.

Related document: Ward’s Fuel Economy Index:

Some models, particularly hybrid-electric vehicles, have held ground. Sales of Toyota Motor Corp.’s segment-leading Prius HEV, for example, rose 28.7% through May.

The Prius accounted for 1.2% of all LV deliveries in the first five months on the Ward’s FEI. (Certain large light-duty trucks and vans do not receive Environmental Protection Agency fuel-economy ratings and are not included in the Index).

However, deliveries of the Toyota Camry Hybrid tumbled 40% in the period, likely giving up sales to the newest-generation Prius.

Similarly, while American Honda Motor Co. Inc.'s Civic Hybrid sales plunged nearly 77% through May, the auto maker’s resurgent Insight HEV made up some of the ground, with sales jumping 61%.

Deliveries of Nissan Motor Co. Ltd.’s Altima Hybrid also have been robust, up some 42% in the first five months. Nevertheless, with the exception of the Prius, hybrids remained small-volume sellers.

The blame for the downward trend in high-efficiency-vehicle sales goes to non-hybrid players in the segment, such as the Honda Fit, down 19.7% through May, and Toyota Yaris, down 38.3%. The 63% drop in Smart Fortwo deliveries also drove the poor results.

Together, such vehicles accounted for 1.5% of the LV market on the Ward’s FEI in like-2009. This year, they made up a mere 0.9% – effectively wiping out gains made by hybrids in the 30-plus-mpg strata of the Index.

Despite falling demand for the most-efficient-vehicle class, plus a slight uptick in sales of the least-efficient vehicles – earning an FEI rating of 15 or less –the industry’s overall year-to-date rating was up 0.8% to 22.3 in May.

Indeed, vehicles in the 20-plus mpg (11.7 L/100 km) to 30 mpg made up 59.4% of all U.S. LV sales in the first five months, compared with 56.6% in like-2009.

With the nation’s economy improving and the threat of gasoline prices nearing $4 per gallon seemingly remote, consumers clearly have backed away from small cars, at least in the short term.

And while auto makers plan to launch numerous new products in this class in the not-too-distant future, Ward’s data suggests near-term increases in industry fuel efficiency likely will come from technological advances applied to popular midsize vehicles rather than a decided shift in consumer preference for smaller cars.

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About the Author(s)

John Sousanis

Director, Information Content, WardsAuto

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