A new report from the Consumer Federation of America (CFA), entitled ,"Paying the Freight: The Consumer Benefits of Increasing the Fuel Economy of Medium and Heavy Duty Trucks," estimates that the average American household spends $1,100 extra on consumer goods and services every year to cover the costs of fueling heavy-duty trucks. According to the CFA study, increasing heavy-duty truck fuel efficiency by 50% would cut truck fueling costs and save the average household $250 per year on goods and services.
It should come as no surprise, therefore, that the vast majority of consumers surveyed favored requiring truck manufacturers to increase the fuel economy of large trucks to reduce fuel costs. According to the most recent results of the CFA’s ongoing poll of consumer attitudes towards vehicle fuel efficiency, 74% of respondents support the standards while just 25% oppose them.
CFA’s new survey also shows that, in spite of the strong desire to regulate the reduction of fuel use by big trucks, only 56% of Americans are actually aware of the impact that such fuel use has on their pocketbooks -- an expense passed on to consumers in the cost of goods and services.
The survey report spells out the particulars: “To demonstrate the economics of fuel cost savings, the EPA [U. S. Environmental Protection Agency] estimates that to achieve the 20% improvement in Class 8 vehicles by 2018, it could involve a technology cost of $6,215.19 While this is a substantial amount of money, it would improve the MPG of a typical truck from today’s 6.5 average MPG, to 7.8 MPG.
“Using typical miles per year and a conservative 4-year period, the investment of $6,215 will save over $43,000 after paying for the technology. For a truck operator, that provides a payback period of just over six months… This is a significant reduction in fuel consumption at a very low cost. While requirements for the next phase of fuel efficiency standards are likely to be more expensive, as this paper shows, the resulting benefits will be much greater. The bottom line: even with significant technology costs, because these vehicles consume such large quantities of fuel, the paybacks will be significant and rapid.”
So, assuming this 50% fuel efficiency project would be all in a day’s work for truck OEMs, would cutting fuel costs in half really deliver these consumer benefits? Sadly, the answer is probably not, according to Glen Kedzie, vice president of Energy and the Environmental Council for the American Trucking Associations. The notion that requiring more fuel-efficient trucks would translate into savings for consumers ignores the complexities of trucking economics, Kedzie told FleetOwner.
"Fuel usage is just one of many operating expenses we have to contend with," Kedzie said, citing the costs of driver pay, volatility in fuel prices, insurance premiums and equipment costs. Even the higher cost of new, fuel-efficient equipment would offset much of the financial benefits from better fuel economy he said.
Kedzie acknowledged that fuel economy is an importance concern for fleets given that 39% of a carrier's costs typically are related to fuel, but he said the CFA estimate ignores the fact that 99% of trucking companies are small businesses that can't necessarily afford to buy new equipment regardless of the payback. "Somebody has to write the check for those trucks. Increasing the bottom line comes at a cost that might put it out of reach for many operations." And while federal incentives certainly would help, it's dubious that a dysfunctional Congress would adopt them, Kedzie said.
CFA is submitting comments to the National Highway Traffic Safety Administration (NHTSA) calling on the agency to recognize: 1) consumers as a major stakeholder in the proceedings; and, 2) the consumer pocketbook savings and the positive multiplier effect that increasing consumer disposable income will have on the economy in calculating costs and benefits in the analysis.