The Illusion of Miles Per Gallon...

So you're looking to buy a new car, eh? You've got two options: You could replace your five year old Honda Civic that gets about 35 MPG with a brand new one, which gets about 45 MPG; Or you could replace your old handy pick-up truck that gets 15 MPG with a new pickup that gets about 20 MPG. You want to do your part to help the environment and save as much money as you can. 

Well, this one seems like a no brainer. By replacing your Civic you gain 10 MPG as opposed to the 5 MPG you'd get from the truck, plus you don't want to replace an inefficient truck with another one that's inefficient. Your choice is obviously the best for both the environment and your wallet, right?

Wrong, according to researchers at Duke University (go Blue Devils!). In an article released in a 2008 issue of Science, titled The MPG Illusion, the researchers argue that using MPG as a measure of fuel efficiency is flawed and that its use could have serious implications for car buyers and public policy.

The basis of their argument is that when you measure fuel efficiency in MPG, it is not a linear improvement, but rather a curvelinear improvement (see the figure below). So contrary to popular belief, an improvement in efficiency from 15 MPG to 25 MPG, is not equally effective as an improvement from 90 MPG to 100 MPG. In fact, the former upgrade is actually far more effective when it comes to reducing gas consumption.

As you can see in the graph, as you increase your MPG, the rate at which you decrease your gas consumption decreases significantly. For example, when comparing the amount of gas used per 10,000 miles, an increase in MPG from 42 to 48 would only result in a decrease of 29.8 gallons. But with an increase of MPG from 16 to 20, you actually save over four times more gasoline: approximately 125 gallons.

Who would've thunk it?

In a series of surveys, the researchers found that the majority people assume the MPG measure is linear. The amount they'd be willing to pay for an increase in MPG from 30 to 40 is equal to the amount they'd be willing to pay for an equal increase in the lower range of MPG. In actual fact, the value of the vehicle increases a lot more with an increase at the lower levels of MPG.

The researchers recommend switching the formula around. Instead of measuring distance over volume, you can measure volume over distance: GPM. In Canada, it is fairly standard to use Litres per 100 km as a measure (although a hefty majority of people still use MPG).

Too often, people have made car buying decisions based off inaccurate linear thinking and have undervalued the small improvements in the lower range of MPG. So yes, we should switch to a common measurement like L/100 km or GPM, but we should also focus many of our overall efforts on improving the efficiency of those vehicles at the lower end of the MPG range rather than pouring millions of dollars into transitioning a 50 MPG car into a 52 MPG car. 

Many thanks to my cousin for sending me the article.