by Jeremy Cato
I am road testing two very large vehicles this week, both equipped with the kind of fuel-saving technologies for which consumers are willing to shell out extra bucks.
2005 Honda Odyssey Touring. Photo: Grant Yoxon. Click image to enlarge
The 2005 Ford Five Hundred sedan, a huge four-door that rides higher than other passenger cars and has room in the trunk for eight sets of golf clubs, has a smallish 3.0-litre V-6 engine mated to a Continuously Variable Transmission or CVT. At a hefty 1,730 kg curb weight, this Five Hundred achieves 12.4 city/8.5 highway (L/100 km). Not bad for a large car.
The seven-passenger Honda Odyssey minivan parked beside it has an engine system that deactivates three of the six cylinders when the power isn’t needed – say, if you are cruising along on a very flat highway. Very slick with a payoff in fuel economy which is better than the Five Hundred: 12.0 city/7.7 hwy.
And that even though the boxy Odyssey weighs a lumpy 2,095 kg and has a 255 horsepower engine versus the Ford’s 203. In fairness, I should say Ford officials argue the efficiencies of the CVT give the Five Hundred the performance of a 250 hp V-6.
Neither Ford nor Honda will disclose exactly how much their fuel-sipping gizmos cost – how much they add to the sticker price. But both the Five Hundred ($32,045-$38,845) and the two Odyssey models equipped with Honda’s Variable Cylinder management (VCM) technology ($38,900-$46,900) are competitively priced against rivals. That said, you can be sure Honda and Ford built the cost of fuel efficiency into the sticker some way or another.
Nonetheless, consumers are showing a greater willingness than ever to spend extra money on not only CVTs and cylinder deactivation systems, but on a variety of features and systems designed to improve fuel economy. According to a Harris Interactive survey released last month, consumers say fuel-saving technologies are the advanced technology they would most likely pay extra for when they purchase their next vehicle.
“The fuel economy issue is at the forefront, and we’re close to a tipping point with some of these consumers,” says Scott Upham, senior vice president of Harris Interactive’s automotive and transportation research group.
Upham, of course, is talking about American consumers, Harris being an Internet market research firm based in Rochester, New York. It is interesting, almost shocking, to see fuel economy register with Americans who have for a decade conducted a flaming love affair with massive sport-utility vehicles (SUVs) and other gas-swilling trucks. The Harris poll, in fact, found that many of the 14,000 drivers surveyed are extremely interested in high-tech “green” transportation.
“There is very intense consumer demand for enhanced fuel economy technologies, such as hybrid vehicles, clean diesel technologies, and eventually the fuel cell option,” he says.
Those surveyed claim they are not just paying lip service to the Sierra Club or Greenpeace, either. For instance, consumers are willing to pay US$1,674 above the purchase price of the vehicle for hybrid electric technology and US$1,260 over the purchase price for a fuel cell vehicle.
Clean diesel is also of great interest. According to the survey, buyers would be willing to spend an extra US$667 for diesels running on low-polluting and carbon dioxide-neutral bio or synthetic diesel fuels refined from feedstocks such as soy, biomass or the like.
All of which is very interesting. Gasoline-electric hybrids are only now just becoming somewhat common in dealer showrooms, although the floor of the recent Detroit auto show was littered with hybrids to be sold in the future.
Meanwhile, no regular consumer can buy a fuel cell vehicle at all today, though almost a decade ago several fuel cell companies and car manufacturers promised them by 2005. True, several manufacturers are now testing fuel cell cars in fleet usage (e.g., Ford in Vancouver and Honda in Los Angeles, but we are years and years away from fuel cells going mainstream).
Not so for all the other technologies in which consumers are showing interest. In the Harris survey, respondents were asked to rate about 50 new-vehicle technologies in 13 categories, ranging from ride and handling to telematics (two-way vehicle communication systems), audio and entertainment.
While the fuel-saving technologies emerged prominently as a cost issue, safety technologies ranked highest in terms of influencing a new vehicle purchase – high enough, in fact, for consumers to say safety technologies would sway them to purchase a particular vehicle over a less well equipped competitor.
“Safety of the family is at the forefront,” Upham says. “They (consumers) feel it should be on the vehicle, and they feel the carmaker should include it as standard equipment.”
Among the safety technologies which in consumers’ minds separate one vehicle from another are rollover protection, pre-crash sensing technology (which readies the vehicles’ safety systems for an expected crash), smart airbags, stability control to prevent skids and fishtailing, advanced lighting and blind spot detection devices.
Most of this safety technology is already available on a substantial number of new models, or is coming to the marketplace within the next two years. They include lane-departure warning systems to alert drivers of a drift off course and airplane-like “black boxes” created to log driving activity.
Again, according to the J.D. Power and Associates Automotive Emerging Technologies Study (which measures consumer familiarity and interest in new car technologies), buyers are willing to pay for more safety gizmos and gadgets – to a point. That point is less than US$1,000. Beyond that, buyers become quite reluctant.
But because so many of the emerging safety technologies rely more on software and microchips than expensive hardware, fancy materials and costly precious metals, the price tag of tomorrow’s significantly safer car is becoming less likely to break the bank of the average buyer.
Those who answered the Harris Interactive survey offered their own perspective on price. They said they’d be willing to pay an extra US$626 for pre-crash sensing, US$601 for electronic stability control and US$601 for radar-enhanced collision warning.
All these devices share a common thread, as do most of tomorrow’s safety technologies: they aim to help drivers prevent crashes rather than merely survive them. At a recent Society of Automotive Engineers (SAE) symposium titled “Electronic Active Safety Systems – How far can we go?” the emphasis was on crash avoidance rather than crash survival.
It appears so-called active safety systems which target the root causes of wrecks are the new frontier. The long-term goal is to prevent accidents from occurring at all.
Eventually, the auto industry’s safety efforts should converge at a point where active safety features such as rollover-preventing stability control combine with passive safety tools such as air bags and crumple zones to dramatically reduce the incidence of automotive injuries and fatalities.
Clearly the trends revealed in collision statistics are encouraging, and they in part reflect a dramatic improvement in the robustness of vehicles designed to protect passengers in accidents combined with the arrival of injury-preventing airbags and anti-lock braking systems which give drivers more control to steer out of trouble in slippery conditions.
Since 1983, even as the number of Canadian drivers has increased to more than 21 million, collisions and casualties have been trending downward — from 3,623 fatal collisions and 157,000 injuries in 1983, to 2,595 fatal collisions and 156,902 injuries in 2002, the last year for which figures are available from Transport Canada.
Of course, a variety of factors and initiatives are responsible for the downward trend, and there is no question that among them is a major improvement in vehicle safety. For instance, during the 1990s airbags and anti-lock brakes started to go mainstream and today they are commonplace.
As this decade unfolds, look for a new crop of high-tech safety devices to reach into all parts of the new-vehicle market, especially in the most affordable, high-volume segments under $30,000. A growing public appetite for safety behind the wheel, not to mention the demands of a competitive market cluttered with more than 250 different models, means most sophisticated safety gadgets will no longer be the preserve of luxury vehicles alone. Automakers see safety as a differentiator, a way to attract buyers to their brands.
Other factors are also coming into play. The price of computer chips and software continues to drop, making such sophisticated electronic gadgetry as radar-enhanced cruise control vastly less expensive. In addition, government regulators have turned their attention to finding ways to help drivers avoid accidents, not just survive a crash. Thus, regulators around the world are now looking at crash-avoidance technologies such as lane-departure warning systems and advanced cruise control.
And the cost? According to Siemens VDO Automotive in Troy, Michigan, the total value of electronic systems per vehicle is projected to rise from about US$2,250 in 2000 to US$3,870 in 2010 – a 58 per cent jump in one decade. Auto analysts expect the US$125 billion global automotive electronics business to grow significantly over the rest of the decade, as more of these do-dads go mainstream.
But it is clear that buyers will absorb only so much of the cost, and they will balk entirely at paying for devices with no perceived value. J.D. Power’s Emerging Technologies Study warns that consumers tend to be most interested in add-ons such as parking aids and lane-departure warning systems. They are less interested in increasingly powerful options such as the system sold in Japan on the Toyota Prius which is designed to actually park the car itself, without a driver behind the wheel.
For consumers, as always the challenge will be to separate the valuable high-tech devices from the fluff. This is not always easy. Sometimes the best devices are sold exclusively on the most expensive models. For example, Honda’s fuel-saving VCM technology is available only on the two most expensive Odyssey models.
Another common practice is to offer desirable features only as part of a larger options package. For example, if you want to buy radar laser cruise control for a Lexus LS430, you must order a larger package of options such as the $5,500 Premium Package that also includes perforated leather seats with heating and air conditioning up front, along with laminated side class and an automatic door closer.
Similarly, Infiniti’s lane departure warning system for the 2005 FX45 is sold only as part of option packages ranging from $7,900-$8,900. It is not a stand-alone option, though it clearly has value: a camera mounted near the rear-view mirror detects lane markings and warn drivers with a buzzer when they get too close to the centre line or the edge of the road.
The consumer challenge will only get more difficult as these useful but sometimes pricey devices proliferate in the market. Take adaptive cruise control. It was available on just three 2001 models; about two dozen offer it today. Parking aids such as the Jeep Grand Cherokee’s Parksense rear backup system ($350) were available on perhaps 30 models three years ago, compared to more than twice that number today.
The wary buyer will benefit from knowing what these devices do and what they offer. Then, the challenge is to measure the value against the price tag. Alas, car buying is only going to get more complicated.