B. Data Base Used

CAFE recaliculations were performed for the 1979
through 1982 model years.1 The 1981 model year was the last
model year for which we had a complete CAFE data base at the
time of the analysis. The 1982 model year was partially incom-
plete, missing final CAFE data for AMC and Chrysler. In order
to reduce the complexity of the analysis, only the top ten
sales manufacturers' CAFE's were examined. They account for
approximately 95 percent of U. S. sales. These manufacturers
are American Motors, Chrysler, Ford, General Motors, Honda,
Nissan, Toyo Kogyo, Toyota, Volkswagen, and Fuji. Separate
CAFE standards apply to the categories of passenger auto-
mobiles, 2-wheel-drive trucks, and 4-wheel-drive trucks.
Therefore, those categories were examined for each of the ten
manufacturers.

For the mileage accumulation trend analysis, data
were available for the 1976 through the 1983 model years. This
data ‘base consisted of all passing valid tests used to support
certification, fuel economy labeling, and CAFE's. The vehicles
generating the data were emission-data vehicles, fuel economy
data vehicles, and running change vehicles. This amounted to
about 33,000 data points.

Iv. Results
A. Mileage Accumulation Trends

Figures 1 and 2 illustrate average test vehicle
mileages for the 1976 through the 1983 model years. As can be
seen from the overall trend line, the average mileage of vehi-
cles when tested has generally increased over these years.
Although the average test mileage for these years was only
approximately 4,500 miles (only a 500-mile increase over the
1975 baseline), nearly 20 percent of the test mileages were in
the 5,000- to 10,000-mile range. The impact of these higher
mileage vehicles is not necessarily indicated by their pro-
portion in the total population. Their impact on CAFE is

1. CAFE standards went into effect in the 1978 model year;
however, EPA records for that year are not readily accessible
and may not be analytically compatible with subsequent model
years.


710-

B. CAFE Impacts

The results of the CAFE recalculations for the 1979
through 1982 model years are shown in Tables 1 through 3. Each
table represents a CAFE category and lists the mpg offset from
high test vehicle mileage for each manufacturer and model year.
For the latest available complete model year (1982) the pas-
senger automobile overall sales-weighted CAFE offset is 0.18
mpg. For two-wheel drive light-duty trucks the 1982 offset is
0.44 mpg, and for four-wheel drive light-duty trucks, the 1982
offset is 0.19 mpg.

Table 1

Passenger Automobiles

[CAFE original ~ CAFE adjusted!

(mpg)
Manufacturer 1979 1980 1981 1982
AMC 0.01 0.01 0.27 0.01
Chrysler 0.06 0.07 0.27 0.25
Ford 0.18 0.11 0.09 0.20
Fuji 0.06 0.14 0.04 0.03
GM 0.21 0.26 0.50 0.23
Honda 0.05 0.01 0.01 0.14
Nissan 0.02 0.02 0.01 0.01
Toyo Kogyo 0.00 0.00 0.01 0.02
Toyota 0.00 0.07 0.00 0.02
vw 0.07 0.02 0.01 0.01
Sales Weighted Average: 0.17 0.18 0.29 0.18

Table 1 shows the passenger automobile CAFE offsets
for each manufacturer. The overall averages for the 1979
through 1982 model years appear to be fairly constant except
for the 1981 model year average. Looking more closely at the
sources of the 1981 increase, Table 1 shows that three manu-
facturers, AMC, Chrysler, and GM, accounted for virtually all
of the 1981 offset. GM, in particular, had nearly double the
offset of either AMC or Chrysler, and since the overall aver-
ages are sales-weighted, the high GM offset had a strong
influence on the average value. However, in the 1982 model
year, AMC and GM significantly reduced their offsets to values
closely in line with the 1979 and 1980 model years. In


5600

5400

5200

5000

4800

4600

4400

4200

4000

3800

-7-

Figure 2

rF ee Overall
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a-aA WwW
rF ©O--—© Nissan/Toyo Kogyo/Toyota/Fuji
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n n 1 n 1 i i” iz
T q T T v T T T
76 77 78 79 80 81 82 83

Model Years


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5200

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4800

4600

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4200

4000

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Figure 1

Overall
AMC

Chrysler

Ford
GM

76

77 78 79 80

Model Years

81

82

83


Figure 3
5600 + —~+ EDV's
O---O R/Cts
~--+ — FEDV's iN
s4o0 L _
/ \
/ \
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4200 y
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4000 +
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1 1 | 4 1 |. 1 |
T T v ~ T ms T T
76 77 78 79 80 81 82 83

Model Years


EPA Report No.:
EPA=AA-CPSB-83-04

Technical Report

The Effects of Test Vehicle
Mileage on Corporate Average
Fuel Economy Calculations

November, 1983

NOTICE

This is a technical support report for regulatory action and

it does not necessarily represent the final EPA decision on
regulatory issues. They are intended to present a technical
analysis of issues and recommendations resulting from the
assumptions and constraints of that analysis. Agency policy
constraints or data received subsequent to the date of release
of this report may alter the recommendations reached. Readers
are cautioned to seek the latest analysis from EPA before using
the information contained herein. .

U. S. Environmental Protection Agency
Office of Air, Noise, and Radiation
Office of Mobile Sources
Certification Division
Certification Policy and Support Branch
2565 Plymouth Road
Ann Arbor, Michigan , 48105


qi2-

Table 3

Light-Duty Trucks, 4-Wheel Drive

(CAFEoriginal ~ CAFEadjusted!

(mpg)
Manufacturer 1979 1980 1981 1982
AMC 0.00 0.00 0.09 0.02
Chrysler ee 0.08 0.13 0.16**
Ford ** 0.22 0.24 0.30**
GM . * 0.34 0.34 0.18
Nissan *e 0.00 0.03 0.00
Toyota ** 0.00 0.00 0.00
Sales Weighted Average: ialal 0.18 -16 0.19

** - See 2-wheel drive trucks for combined 2-wheel drive and
4-wheel drive results.

Tables 2 and 3 show the 1979 through 1982 CAFE
offsets for the two light-duty truck classes. These classes
are more difficult to analyze because some manufacturers in
some model years elected to combine the two-wheel drive (2WD)
and four-wheel drive (4WD) vehicles into one CAFE class.
(These occurrences are indicated in Tables 2 and 3.)

The overall 2WD averages widely fluctuate over the
1979 through 1982 model year span. This fluctuation appears to
be caused primarily by GM's offset fluctuation over that
period. In particular, the overall 1982 2WD average of 0.44
mpg was due to GM's offset of 0.81 mpg which is more than twice
any other manufacturer's offset. As with the passenger car
class, Volkswagen and the Japanese manufacturers exhibited
virtually no offset due to test vehicle mileage accumulation,
whereas the domestic manufacturers were usually in the 0.15 mpg
to 0.35 mpg range.

The 4WD class (Table 3) showed much the same pattern
as the 2WD class concerning domestic manufacturers versus the
Japanese manufacturers, although there were only two Japanese
Manufacturers in this class. However, AMC showed virtually no
offset for its 4WD trucks. Overall, the offsets for this class
tended to be lower than in the 2WD class, and GM did not exhibit
the same fluctuations as they did in the 2WD class. (In fact,
GM showed a significant offset drop in 1982 for this class.)


-1l-

contrast, for 1982, Ford exhibited an increase in tneir offset
after showing decreases for the 1979 through 1981 model years.
Given these fluctuations in offsets over these years, there
does not seem to be a clear trend of increasing or decreasing
offsets for any domestic manufacturer.

As reflected in the mileage accumulation trends
(Figures 1 and 2), the domestic manufacturers have consistently
exhibited higher passenger automobile CAFE offsets than the
foreign manufacturers. The exception to this is VW, which is
actually a domestic manufacturer but shows consistently very
small offsets as do the Japanese manufacturers. All of the
Japanese manufacturers had negligible offsets for all model
years for passenger cars, except for Honda which showed a
significant increase for 1982. This increase is also reflected
in Honda's mileage accumulation trend (Figure 2).

Table 2

Light-Duty Trucks, 2-Wheel Drive

[CAFEoriginal - CAFEadjusted]

(mpg)
Manufacturer 1979 1980 1981 1982
No No
AMC 0.30 Vehicles Vehicles 0.00
Chrysler 0.01** 0.13 0.08 0.16**
Ford 0.23** 0.34 0.34 0.30**
GM 0.19** 0.36 0.14 0.81
Nissan -  0.00** 0.00 0.07 0.01
Toyo Kogyo 0.00** 0.00 0.00 0.00
Toyota 0.00** 0.00 0.01 0.01
vw 0.00** 0.00 0.00 0.00
Sales Weighted Average: 0.16** 0.29 0.19 0.44

** - Combined with 4-wheel drive trucks as a manufacturer
option.


dependent on the sales fraction they represent in a manu-
facturer's product line. Thus, these mileage data only serve
the purpose of illustrating the trends toward higher test
vehicle mileages since 1975, but do not accurately reflect CAFE
impacts.

On a manufacturer-specific basis, Figures 1 and 2
also illustrate individual manufacturer trends and compare
general manufacturer positions. Domestic manufacturers,
particularly General Motors and Ford, test their vehicles at
significantly higher mileages than the foreign manufacturers.
General Motors, Ford, and Chrysler also have tended to increase
their average test mileages over those model years. American
Motors tended to look more like the foreign manufacturers until
1982 when they exhibited a drastic increase in average test
Mileage. In general, with the exception of Honda, foreign
Manufacturers do not appear to have made an overall effort to
test at higher mileages. Their averages have remained at near
the 4,000-mile baseline through the years. It appears that
Honda has greatly increased test mileage in 1982 and 1983.

Average test mileages of each of the previously
described vehicle types are plotted by model year in Figure 3.
It can be seen that on an overall average, FEDV's test mileages
increased rapidly until the 1980 model year, then dropped off.
It is not clear why this peak occurred, but from Figure 1 it
appears to be heavily influenced by General Motors. (However,
the General Motors peak is also unexplained.) Running change
vehicles have exhibited a steady rise in test mileages, also
exhibiting a slight peak in the 1979 model year. As expected,
the EDV test mileages remained steady at around 4,000 miles,
until the 1983 model year. For the 1983 model year, new rules
took effect that allow manufacturers to test EDV's at any mile-
age. Although this was originally intended to save manufac-
turers money by running them at less than 4,000 miles, average
EDV mileage data indicate an increase in mileage, presumably
to obtain a fuel economy advantage. This increase in overall
average EDV test mileage was nearly entirely due to the in-
creases of American Motors, Chrysler, and Honda for 1983.
(General Motors had a small increase of 200 miles over 1982.

To summarize the test mileage trends, the over-
all trend from the 1975 baseline of 4,000 miles had to
increase test mileage. The domestic manufacturers have
tended to accumulate significantly more miles than the for-
eign manufacturers. Manufacturers appear to be using the new
flexibility to test EDV's at higher mileages beginning in
the 1983 model year, as evidenced by the increase in average
EDV test mileages between the 1982 and 1983 model years.


III. Data Analysis
A. General Methodology

The basic approach used to quantify the CAFE credit
attributable only to test vehicle mileage was to adjust test
results generated at over 4,250 miles to the 4,000-mile level
and evaluate new CAFE's. These were then subtracted from the
original CAFE's to obtain the mileage credit for each manu-
facturer and each CAFE class.

The equation used to factor test results to the 4,000-
mile level was developed as part of a proposed fuel economy
rulemaking (FR 26698, June 9, 1983), in which EPA proposed the
equation to adjust test values generated from vehicles at over
6,200 miles, for labeling purposes only. This same equation
was implemented in the October 13, 1981 rulemaking, applying it
to emission-data vehicles at over 6,200 miles (FR 50498, October
13, 1981). The equation is as follows:

FE4,000m = FEp [0.969 + 0.842 X 1075 (m)j-1
Where: FE4,Q00m = Fuel economy data adjusted to
4,000-mile test point

FEyp = Tested fuel economy value

The equation was derived by examining mileage effects
on fuel economy within the fuel economy and certification data
base for the 1977 through the 1981 model years. A detailed
report on this derivation is attached and is titled, "The
Effect of Vehicle Mileage Accumulation on Tested Fuel Economy."

For each CAFE category, individual test results that
went into the original CAFE calculation were factored (adjusted
to the estimated level at 4,000 miles) if the vehicle that
generated the results had accumulated more than 4,250 miles.
The CAFE was then recalculated with the adjusted test results
using the same sales distribution as the original CAFE calcu-
lation. The fuel economy “mileage credit" is the original CAFE
value minus the adjusted CAFE value, for each model year,
Manufacturer, and CAFE category.

Summary statistics were also derived for average test
vehicle mileages in order to illustrate trends in mileage accu-
mulation. These are illustrated in Figures 1 through 3.


-3-

2. Certification running change vehicles:

These are treated the same as emission-data
vehicles, but are used to demonstrate compliance for design
changes made after original certification. There has generally
been no mileage limitations on these vehicles, except that they
be stabilized. However, historically, running change test
vehicles averaged 4,000 miles. Unlike emission-data vehicles,
data from running change vehicles are not factored for mileage
accumulation over 6,200 miles.

3. Fuel economy data vehicles:

These are vehicles used specifically for
generating fuel economy data. These vehicles may, for example,
have originally been emission-data vehicles, running change
vehicles, or development vehicles. These too must be stabi-
lized, but there is an upper limit of 10,000 miles accumulation.
EPA allows up to 10,000 miles on FEDV's so that manufacturers
can make increased use of the vehicles by repeated reconfig-
uration and retesting. In providing this greater test mileage
flexibility, EPA did not intend nor expect that the fuel
economy data would become biased so as to decrease the repre-
sentativeness of label values or the stringency of the fuel
economy standards.

D. To the extent that manufacturers now use test
vehicles for fuel economy testing that have accumulated greater
than 4,000 miles, their CAFE's will be higher than they would
have been if the 4,000 miles had been adhered to since 1975.
This increase is not due to design improvements that are re-
flected in actual in-use reductions in fuel consumption.
Therefore, manufacturers may be getting false credit in their
CAFE's due to a technical loophole.

E. Average FEDV mileages have increased since 1975. For
all manufacturers, the average FEDV mileage was 4,900 for the
1983 model year (non-sales weighted), and peaked at 5,500 miles
in the 1980 model year. Although this does not appear to be a
significant increase over the 4,000-mile 1975 baseline, there
was a wide variance in the test mileages for each model year
(standard deviations of 950 miles to 1,600 miles). A signi-
ficant amount of tests were conducted at mileages much greater
than the average. Since CAFE is a sales-weightea average, the
CAFE benefit from high-mileage test vehicles depends upon the
sales representation of the test vehicle as well as the mile-
age. This report quantifies that benefit.


~2-

I. Purpose

The purpose of this analysis is to estimate the annual
CAFE credit manufacturers obtain by testing vehicles at greater
than 4,000 miles accumulation.

II. Background

A. A vehicle's fuel economy performance usually improves
with mileage accumulation due to the gradual reduction in fric-
tion between various drivetrain parts. This improvement is
most rapid during the initial "break-in" period of the vehicle
(the first few thousand miles) and gradually levels off at
higher mileages (twenty thousand to thirty thousand miles)
before eventually declining in fuel economy at very high mile-
ages due to losses in engine efficiency.

B. In 1975, Congress passed the Energy Policy and
Conservation Act (EPCA) which mandated a 100 percent improve-
ment in vehicle fuel economy by 1985. The baseline used for
this improvement standard was the EPA fuel economy data base
using the 1975 test procedures. This data base consisted of
emission test vehicles that were required to be at 4,000 miles,
+ 250 miles. Thus, any general increase in average CAFE test
vehicle mileages over 4,000 miles will result in CAFE benefits
due only to test vehicle mileage effects.

Cc. Data from several different types of test vehicles go
into the CAFE calculation. These vehicle types along with
their mileage restrictions are as follows:

1. Certification emission-data vehicles:

These are test vehicles used to demonstrate
compliance with emission standards to obtain initial certi-
fication. Prior to the issuance of certification cost
reduction regulations on October 13, 1981, emission-data
vehicles were required to have 4,000 miles (+ 250 miles)
accumulated at the time of testing. The new regulations now
allow emission-data vehicles to have accumulated any mileage,
as long as it is greater than a minimum mileage for vehicle
stabilization, established by the manufacturer. However, if an
emission-data vehicle accumulates more than 6,200 miles, the
fuel economy results must be factored back to the 4,000-mile
baseline.


-13-

In summary, for the four model years where we have
been able to recalculate CAFE's, the CAFE offsets vary greatly
between manufacturers. However, domestic manufacturers tend to
account for virtually all of the overall offsets. Except ina
few cases, the CAFE offsets show no definite model year trends.
However, our average vehicle test mileage data for the 1976
through 1983 model years indicates a general trend of increasing
test vehicle mileage accumulation.