New Car Fuel-Efficiency Labels Mandated by EPA, DOT

The Environmental Protection Agency and Department of Transportation (DOT) have directed that cars and light trucks carry labels comparing estimated five-year fuel costs with those of the average new vehicle following industry opposition to adding fuel-economy letter grades to the window stickers.  The labels, which will include yearly fuel-cost estimates, must be affixed to passenger cars and trucks starting with model year 2013.  The new stickers will rate vehicles on a scale of one to 10 for smog and greenhouse-gas emissions.  “These new window stickers are a win-win” for car buyers and the auto industry, Transportation Secretary Ray LaHood said.  “They’ll help consumers make informed choices to save at the pump.”

Plug-in hybrids and electric vehicles must carry labels that specify how far a car can drive on electric power when charged.  The government decided to scrap plans for labels with letter grades after automakers, dealers and Congress said that consumers may avoid vehicles labeled with lower rankings.  Regulators abandoned the letter-grade proposal after being criticized by automakers and consumer tests indicating that some found the plan confusing, according to EPA Administrator Lisa Jackson.  “About half the people didn’t think the letter grade gave them all the information they needed,” Jackson said.  “And there was confusion that the letter grade was about the whole car.”

The labels will be quite detailed.  The estimated annual fuel cost is there, as are the standard miles-per-gallon figures for city and highway driving.  New features include the amount of fuel or electricity the vehicle will require to drive 100 miles, as well as the expected savings or cost of fuel over the next five years.  The miles-per-gallon range for same-class vehicles will be featured on the decals, as well as the highest fuel economy.  “The new labels…are the most dramatic overhaul to fuel economy labels since the program began more than 30 years ago,”  the DOT said.

The labels have some new features,  including a QR Code that allows smart phones users to access online information about how various models compare on fuel economy.  Consumers can enter information about their particular commutes and driving habits to get a more exact estimate of fuel costs.  The rule also finalizes new labels for electric vehicles and plug-in hybrids to convert the use of electricity to a miles-per-gallon equivalent — and to allow users to compare charging costs to gasoline use.  In 2010, the EPA approved interim labels for the electric Nissan Leaf and extended range electric Chevrolet Volt, which it categorizes as plug-in hybrids.

The Alliance of Automobile Manufacturers – the trade association representing Detroit’s Big Three automakers, Toyota and seven other automakers, praised the move and said the move complements labels between the federal government and California.  “Today’s announcement by EPA and DOT is a victory for consumers.  The average car buyer is a savvy shopper who gathers much information prior to buying a car, so the decision to go with informative MPG labels fits consumer needs well.  This label provides clear, visible data on fuel economy in a format consumers are already familiar with,” the group said.

Not everyone is happy with the move.  Dan Becker, director of the Safe Climate Campaign, said “The Obama administration caved to auto industry pressure and pulled the plug on a key consumer education proposal intended to help us determine which cars are cleanest.  This decision denies consumers clear information to help them make educated choices.”

The EPA created the new labels with the Transportation Department as part of rules adopted in 2010 requiring a 42 percent increase in average CAFE efficiency standards to 35.5 miles per gallon for 2012 – 2016 vehicles.  The agencies plan to require that 2017 – 2025 cars and trucks push efficiency goals to 60 mpg, a target automakers would likely resist.  Automakers, who supported the new labels, are retooling their production lines to meet government and consumer demands that they offer greater efficiency and cut pollution.