Auto Labels: Grades Make Consumer Sense

Courtesy of EPA

EPA Label Option 1

This week, U.S. EPA proposed something that could change the way consumers spend car-buying dollars—labels that make sense.

For 30 years, the federal government has required new cars and light trucks on sales lots to carry labels that show consumers the miles-per-gallon performance of that particular car or truck model. These labels have been somewhat helpful, but they don’t provide as much information as this consumer, at least, would like.

Now the agency is preparing to improve the label performance. It has unveiled two proposed approaches. Both of the new labels would tell consumers how the vehicle stacks up against others for greenhouse gas emissions and other tailpipe pollution. Both of the proposed labels also report how much it costs to fuel the vehicle each year. Only one of the labels—dubbed Label Option 1 by EPA—provides two other very important pieces of information: It also tells how much a consumer will save in fuel costs over five years, and it provides a letter grade that reflects how the vehicle performs on tailpipe emissions and efficiency.

Think about how this grading system could affect you. You could shop for a car without bringing along back issues of Consumer Reports or reams of computer printouts about auto efficiency comparisons. You could quickly scan the field and go for the A and B cars and avoid the D vehicles that spew more pollution and will cost more to fuel.  If you do happen to want a bit more information than is available on the label, EPA has taken care of that too.  Each label contains a QR code that allows many smart phones to access a web page where buyers can compare cars and personalize estimates based on their own driving habits. Department of Energy also provides some really helpful information on its fuel economy website, fueleconomy.gov.

Great idea? We think so. But the auto industry is already complaining about the grading system, trying to compare it to childhood memories of failing or passing.

Courtesy of EPA

EPA Label Option 2

We think of this system as being more comparable to the grading system health departments have used for restaurants for years. You’ve probably noticed the placards. They protect diners from unhealthy food preparation practices and encourage high performing restaurateurs to keep up the good work.

Grades mean something. They’re easy to read and understand. They can steer you quickly toward a smarter car purchase. They are, in short, consumer friendly.

Some states already require cars and light trucks to carry information about pollution levels on their sales labels. EPA’s proposal significantly improves on that model.

You have a chance to weigh in on all of this. EPA is inviting everyone—not just policy wonks and auto industry representatives—to voice an opinion about the labels. The agency needs to hear from consumers who care about good value and a clean environment. The agency will be taking comments for 60 days, which means you need to submit your thoughts by the end of October.

The final version of the new label will be adopted by the end of the year, and the new label will appear on new cars and light trucks beginning in the 2012 model year.

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