Another Reason GM (GM) And Ford (F) Can’t Sell Cars: Fuel Mileage

September 27, 2007 by Douglas A. McIntyre

GM (GM) can cut all of the costs it wants to, and get a world class contract with the UAW. And, Ford (F) can follow suit. But, if they can’t sell cars, over time it will not matter.

In the current world of high fuel costs and a sinking feeling about the economy, most drivers probably look at fuel-efficiency when they buy a car.

The Environmental Protection Agency came out with its new rankings for fuel use. No one should be surprised that Honda (HMC) and Toyota (TM) were at the top of the list. Across its model line Honda’s averaged 22.9 mpg and Toyota 22.8.

Over at GM, the mpg average was 19.4 and at Ford 18.7. The head of Ford did run part of Boeing (BA) where the mpg for the airplanes is low, so it may take him some time to get around to the notion that cars have smaller engines than jets do.

Chrysler did poorly with an average mpg of 18.3.

The Japanese fleets which are about 20% more fuel-efficient than the Americans. That’s too big a spread.

Douglas A. McIntyre