CAFE: In the automotive world, its not your daily fix at the Starbucks drive-through, its an acronym that stands for Corporate Average Fuel Economy — and next year’s new CAFE standard is going to permanently change the cars we drive.
The United States enacted a CAFE standard in response to the OPEC oil embargo of the 70s, slowly raising the average fuel economy of passenger cars in the is country from 18mph in 1978 to 27.5 mph in 1990. After 1990, fuel got cheap, (in fact, adjusted for inflation, 1998 saw the lowest average price for a barrel of crude in the post-War era) and so 27.5 mph is still the average fuel economy of passenger cars sold today, in 2010.
The $150 a barrel peak in the summer of 2008 shook us out of our complacency, however, and the CAFE idea was dusted off, and put back in play with a vengeance. Next year, the CAFE rises from 27.5 mph to 30.2 mph. In other words, the average mileage of all the cars sold next year by each manufacturer will have to rise almost ten percent.
What’s that mean when the rubber hits the road? Three things: Electric, plug-in hybrid, and hybrid.
If you think the profusion of electric car that are newly here or just about to arrive — the Nissan Leaf, the Chevy Volt, the plug-in Prius, the Tesla — not to mention surprise electrification announcements from newly converted like BMW and Mercedes — is part of some global green zeitgeist, think again.
There’s lots of gas saving technologies out there: displacement-on-demand, dual-clutch transmissions, diesel-ification, carbon-fiber-fication, to name but a few. But the real big gains in average fuel economy over a whole line of vehicles — 10% gains — will most easily come if a good portion of those vehicles are 50 mph or higher. And the fastest way to get there, is via electrification. The real questionis — will consumers buy?
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