Behind the scenes, a stealthy push for fuel efficiency

Amid the flood of gas-guzzling SUVs still hitting the market, many automakers are also working toward improving vehicle fuel efficiency.

The speed of progress may be glacial, but the tone of auto-industry banter about the subject has taken on new urgency.

Since the World Trade Center disaster, "I find myself less willing to forgive any [vehicle] that gets one or two miles per gallon less than it should," says auto reviewer Jim McPherson.

While Americans fundamentally favor big, heavy cars, he says, reducing oil imports from the Middle East should have been a priority all along.

But developing cars that don't run on gasoline has become a priority for automakers this year, albeit quietly. California regulations require 2 percent of all vehicles sold in the state to be zero-emissions vehicles (ZEVs) starting in 2003. Automakers have sued the state, saying buyers don't want electric cars and calling the regulations too expensive.

But behind the scenes, the six largest automakers in California - Ford, General Motors, DaimlerChrysler, Honda, Toyota, and Nissan - are working fervently to design fuel-cell and electric vehicles they hope will meet the mandate.

The two main thrusts of this effort will be fuel-cell vehicles aimed at fleet sales to large companies, and neighborhood electric vehicles for resort and retirement communities. While fuel cells will be limited and expensive, neighborhood electrics are little more than golf carts for street use, with top speeds of 25 to 35 miles per hour. As such, they don't count as full-fledged ZEVs. But manufacturers earn credits toward the requirement by offering them.

All the US automakers have already bought small companies that produce neighborhood electric vehicles, hoping to amass enough credits to meet the requirement for the equivalent of 4,600 ZEVs in the first year.

Still, "it's encouraging that these vehicles are coming from real car companies," says Art Spinella, president of CNW Marketing Research in Bandon, Ore. With the backing of large US automakers, these ZEVs are more likely to last and turn a profit than past electric cars built by "tinkerers, dreamers, and assorted oddballs," he adds.

But when it comes to fuel-efficient vehicles, foreign brands are leading the way. Honda's Insight and Toyota's Prius have already proved the technical feasibility of hybrid-electric cars. So far they sell at a loss.

Meanwhile, Ford, Chevrolet, and Dodge have announced plans for hybrid SUVs to earn California credits in 2004, but are not promoting them when they may hurt the bottom line, says Bill Seltenheim, an analyst with AutoData in Woodcliff Lake, N.J.

Besides developing hybrids, automakers are working to boost efficiency in other ways, including diesel engines, direct fuel injection, and quieter four-cylinder models. But the biggest development is the proliferation of the continuously variable transmission.

The CVT seeks to marry the convenience of an automatic with the fuel efficiency of a manual transmission. It uses no gears, but rather a pair of pulleys that vary in size to create an infinite number of drive ratios.

CVTs aid efficiency for two reasons: They keep the engine operating at its most-efficient speed under all conditions, and the clutch doesn't waste the energy that a conventional automatic's clutch does when it changes gears.

A bit of history: The CVT first came to the United States in 1989 in the Subaru Justy, a tiny three-cylinder econobox that never sold well and was discontinued. Honda brought back the CVT in 1997 with the Civic HX, but some complain it is underpowered and unpleasant to drive. Last year, the success of the Toyota Prius proved an electric motor is the perfect complement to a CVT. (Look for more such drivetrains from Toyota in the near future.)

This model year, the number of vehicles with CVTs will triple. In addition to the Civic and Prius, the new transmissions will be available in the Honda Insight, Saturn Vue SUV, and Audi's A4 and A6 sedans.

Despite the improvements, analysts don't expect to see a major shift in American buying habits from SUVs to fuel misers this year. Gas in the US remains cheap compared with most places in the world. And even gaining several miles per gallon won't be all that much of a help to the average American's budget, except for people with unusually long commutes.

But in the face of higher national fuel economy standards, zero-pollution mandates, and potentially decreasing oil imports, manufacturers can't afford not to be able to build more fuel-efficient vehicles when the need arises.

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