Fuel economy in automobiles is the amount of fuel required to move the automobile over a given distance. While the fuel efficiency of petroleum engines has improved markedly in recent decades, (especially diesel engines that are now up to 45% efficient), this does not necessarily translate into better fuel economy, if larger and heavier vehicles are used, or if that efficiency is used to produce faster cars capable of higher rates of acceleration.
A modest improvement in fuel economy for a relatively inefficient vehicle can provide greater savings in terms of financial cost to the driver and environmental impact than a proportionately larger increase for a more economical vehicle. This is most intuitively demonstrated using the inverse scale - gallons per mile or liters per kilometer. If a driver who travels 15,000 miles (24,000 km) a year switches from a vehicle with 10 mpg to 12 mpg average fuel economy (0.10 gallons per mile to 0.083 gallons per mile), 250 gallons are saved. A similar 20% improvement in exchanging a 30 mpg for a 36 mpg (0.033 gallons per mile for 0.27) vehicle saves only 83 gallons for similar driving patterns. Because mpg and gas consumption are inversely related, mpg can cause illusions. Gallons Per Mile is more useful than mpg when comparing the gas consumption of different cars.
Fuel economy at steady speeds with selected vehicles was studied in 1973, 1984, and 1997. The most recent study indicates greater fuel efficiency at higher speeds than earlier studies; for example, some vehicles achieve better mileage at 65 than at 45 mph (72 km/h), although not their best economy, such as the 1994 Oldsmobile Cutlass, which has its best economy at 55 mph (29.1 mpg), and gets 2 mpg better economy at 65 than at 45 (25 vs 23 mpg). All cars demonstrated decreasing fuel economy beyond 65 mph (105 km/h), with wind resistance the dominant factor, and may save up to 25% by slowing from 70 mph (110 km/h) to 55 mph (89 km/h). However, the proportion of driving on high speed roadways varies from 4% in Ireland to 41% in Netherlands.
There were complaints when the U.S. National 55 mph (89 km/h) speed limit was mandated that it could lower, instead of increase fuel economy. The 1997 Toyota Celica, got 1 mpg better fuel-efficiency at 65 than it did at 55 (43.5 vs 42.5), although almost 5 mpg better at 60 than at 65 (48.4 vs 43.5), and its best economy (52.6 mpg) at only 25 mph (40 km/h). Other vehicles tested had from 1.4 to 20.2% better fuel-efficiency at 55 mph (89 km/h) vs. 65 mph (105 km/h). Their best economy was reached at speeds of 25 to 55 mph (see graph).
The Energy Tax Act of 1978 in the U.S. established a gas guzzler tax on the sale of new model year vehicles whose fuel economy fails to meet certain statutory levels. The tax applies only to cars (not trucks) and is collected by the IRS. Its purpose is to discourage the production and purchase of fuel-inefficient vehicles. The tax was phased in over ten years with rates increasing over time. It applies only to manufacturers and importers of vehicles, although presumably some or all of the tax is passed along to automobile consumers in the form of higher prices. Only new vehicles are subject to the tax, so no tax is imposed on used car sales. The tax is graduated to apply a higher tax rate for less-fuel-efficient vehicles. To determine the tax rate, manufacturers test all the vehicles at their laboratories for fuel economy. The U.S. Environmental Protection Agency confirms a portion of those tests at an EPA lab.
Ideally, a car traveling at a constant velocity on level ground in a vacuum with frictionless wheels could travel at any speed without consuming any energy beyond what is needed to get the car up to speed. With ideal regenerative braking, this energy could be completely recovered. In real-world conditions, energy is lost in a number of ways: engine efficiency, aerodynamic drag, rolling friction, braking, losses in the transmission, air conditioning, electrical systems
Source: Wikipedia (All text is available under the terms of the GNU Free Documentation License)
For more information (background, pictures, experiments and references):
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Fuel Economy in Automobiles