Alex Lipow, a public policy, telecommunications and fraud intern at NCL this winter, is taking a gap year after high school before starting college at Emory University in Atlanta, Georgia in the fall. In high school, Alex was actively involved in debate, Model United Nations, and student government. Alex has experience working as an intern in Congressman Steve Cohen’s office and as a fellow on President Obama’s re-election campaign.
A recent article written by Dave Hurst in Forbes discusses the discovery that some major auto manufactures intentionally over-reported the fuel economy of their cars. This in turn raised the reported average fuel economy of their entire fleets. According to Hurst, the EPA mandates that certain procedures be used to test the fuel economy of cars but relies a great deal on manufactures to conduct the tests themselves. The results of these tests are then used in advertising and are displayed on window stickers for consumer reference. The goal of this process is to give consumers the ability to compare cars sold by different companies based upon their stated mileage.
The EPA first audited Hyundai and Kia after receiving complaints about the accuracy of their reported fuel economy figures. The audits show that Hyundai and Kia exaggerated mileage data showing that some of their vehicles had reached 40 miles per gallon (mpg). In some cases, the fuel economy was exaggerated by as many as six miles per gallon. This practice appears to be widespread. A class-action lawsuit is pending against Ford for misrepresenting mileage numbers in its C-Max and Fusion hybrids and Honda was recently in court over mileage claims of its Civic hybrid.
When I first read Hurst’s article, I could not help but ask who is protecting consumers and holding corporations accountable for malfeasance like this? Reliable information is crucial to the buying process, whether it be homes, toasters or cars. When comparing vehicles, fuel economy is often one of the most important features consumers consider. If it is listed inaccurately, as in the instances described above, would so many people have bought these cars?
How has this misreporting become so widespread? One reason may be the relatively few resources the EPA dedicates to mileage testing. A 2009 Car and Driver article found, for example, that just 18 EPA employees are responsible for mileage testing. With such a small staff, the EPA is only able to test 200 to 250 vehicles per year, roughly 15 percent of the total number of new car models introduced in a given year. It may be time for the EPA to consider more closely monitoring mileage testing or levying sizable fines against companies that misreport mileage. At the very least the EPA should devote more resources to its own testing program so that it can protect consumers from this type of deceptive practice. Had regulators been able to supervise the testing and reporting of this information, consumers may have been able to make a better decision about the product they would have preferred to buy.