Electric Cars' MPG Conundrum


The mega-mileage hype surrounding the Chevy Volt and Nissan Leaf points to problems with performance ratings on new car technologies

General Motors made a lot of noise Aug. 11 with the announcement of a 230-mile-per-gallon city fuel-economy rating for its Chevrolet Volt extended-range electric car. Not to be outdone, Nissan (NSANY) said its Leaf electric car gets an equivalent of 367 MPG.

This one-upsmanship by the two automakers probably just confused any would-be buyers of these cars, which will both hit the market later next year. It also raises serious questions for the government and car companies: How will federal regulators rate the efficiency of the newest-tech cars, and how will the automakers use that data to market them? Neither number is likely to match up the real fuel-economy performance for either car, since Volt buyers will all drive it differently and Leaf drivers won't even use gasoline.

To see how unhinged MPG becomes as electricity takes a bigger role under the hood, look at the Chevy Volt. The Volt will always drive using its electric motor and will only employ a small gasoline engine to recharge the vehicle's 400-pound, 16-kilowatt battery. In the city, where the car uses its braking system in stop-and-go traffic to recharge the battery, the Volt will almost never need the gasoline engine. Because the Volt can go 40 miles before needing a charge, the 60% of drivers who cover less than 30 miles a day may never use the gasoline engine. "For some people, the fuel economy could be infinite," says James N. Hall, principal of 2953 Analytics, a Detroit-area consulting firm.

City vs. Highway Mileage

Still, the Volt may use some gasoline in city driving, so the government's methodology gives it a 230 MPG city rating. But out on the highway, a Volt driver may use less braking and may floor the accelerator. And when they run the air conditioner, the battery drains even faster, requiring even more gas-engine recharging. GM insiders say the Volt could get less than 50 MPG under those conditions. At the moment, it looks like the Volt will be assigned a combined city/highway rating of 124 MPG, though the feds haven't certified any of these ratings yet. But how will carmakers get that across in advertising, while alerting shoppers that some of them will do far worse, and some much better?

"This car is different," says Tony Posawatz, vehicle line director for the Volt. "In the future, is MPG really the best measure? That's the question."

It's a question that hasn't really been visited in more than 50 years. Mileage ratings date back to when gasoline companies, namely Standard Oil Co. of New York and Mobil, began holding a cross-country car race called the Socony Mobil Economy Run. The winner's performance was measured in miles per gallon. Carmakers who fared well used to brag about their MPG results. That has been the standard performance-efficiency measure for cars ever since, Hall says.

But now the industry is being forced to ponder new possibilities for measuring a car's energy use, environmental impact, and cost of travel.

In Europe, some countries measure carbon dioxide output per kilometer driven, but that doesn't tell the consumer anything about the cost of driving the car. GM suggests measuring cost per mile, which could be used for any kind of car, be it powered by battery, hydrogen fuel cell, ethanol, natural gas, diesel, or gasoline. The Volt costs about 2¢ per mile, Posawatz says. A typical compact car would cost 12¢ per mile when gasoline sells for $3 a gallon.

But that measurement raises thorny issues as well. California residents pay more for electricity than people in most other states. So their cost will be different. Even gasoline prices vary by locale, Hall points out, so it will never be an easy number to use. "The problem is there is no national number for the cost of electricity or gasoline," he says.

Measuring Up

You could measure energy used per mile. But then you would have to convert electricity used into an equivalent in gallons of gasoline or vice versa, Hall says. And you need to educate consumers on what those new numbers mean. It's a big communication problem for carmakers and the feds.

There will be other marketing issues for carmakers, too. For example, BMW's Mini E takes four to six hours to charge if the owner has a 220-volt charging system, but it needs 24 hours on a 110-volt system. And as for range, the Leaf can go 100 miles on a charge in the city, Nissan says, but it will go far less on the highway and if the driver has a lead foot and likes an air-conditioned cabin.

The government already measures a mileage equivalent for electric cars, the number that regulators may assign for the purposes of calculating compliance with Corporate Average Fuel Economy, or CAFE, rules. That's how Nissan came to brag about its 367 MPG number for the Leaf. (Every carmaker must hit a fleet average of 23.1 MPG for the trucks they sell and 27.5 MPG for cars. The standards go up starting in 2011.) Sales of the Volt and Leaf will help the CAFE performance for GM and Nissan fleets.

The Leaf's pumped-up MPG figures mean something if you work for the National Highway Traffic Safety Administration, which measures CAFE, or if you're a government compliance manager at a car company. But for consumers looking to compare performance across different vehicles, and among various technologies, the numbers won't mean a whole lot. The challenge for Washington and the carmakers: Find a measurement that does.

Welch is BusinessWeek's Detroit bureau chief.

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