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Car Buying

How to Compare New Car Fuel Economy


author photo by Nick Palermo May 2013

Fuel economy is an important consideration when choosing a new car. In fact, according to a recent study by J.D. Power and Associates, new car fuel economy is among the top five reasons buyers choose a specific vehicle, topping factors such as performance and safety. Drivers clearly want fuel-efficient vehicles, especially vehicles that drive more than average.

Check the Window Sticker

Fortunately for new-car shoppers, every window sticker lists Environmental Protection Agency (EPA) fuel economy estimates, along with an estimate of fuel expenses. But just beneath those figures is a paragraph of fine print, explaining some of the factors that can negatively affect fuel economy.

Still, taking some of the guesswork out of fuel economy can help new-car shoppers make a smart decision. The fuel economy information on the window sticker is a good baseline, but factoring in your driving habits will help you to understand what to expect from a new car. Once you have a single, customized estimate in miles per gallon for each car you're considering, you'll be ready to make a well-informed decision.

A fuel economy label lists city, highway and combined fuel economy estimates, along with an estimated annual fuel cost and a comparison of fuel costs over five years. For a more accurate assessment, you should estimate fuel economy for your driving style and vehicle, then determine the costs.

The combined fuel economy figure is the big, bold number you'll probably see first. It's also the most important, since most drivers spend some time in stop-and-go traffic and some on the open road. The combined figure is just a weighted average of the city and highway estimates, with a bit more emphasis on city driving. Unless you drive almost exclusively in heavy city traffic or only on long highway trips, start with the combined fuel economy estimate. Whether you use the city, highway or combined number, be consistent on each vehicle you consider.

Your Driving Style

After determining what kind of driving you're likely to do, think about how you drive. Some of the factors that can reduce fuel economy include quick acceleration, high cruising speeds, extreme weather or heavy loads in the vehicle. If one or two of these factors applies to you occasionally, make no adjustments. But if you routinely drive aggressively or expect your fuel economy to suffer due to another factor, reduce your estimates by two or three mpg. Again, be consistent.

On the window sticker, the estimated annual fuel cost uses the combined fuel economy estimate and the following assumptions: 15,000 miles per year and $3.80 per gallon for gas. This is another area where driving habits could significantly impact estimates. If you drive 7,500 miles per year, fuel will cost about half the estimated amount. So, it's important to know roughly how many miles you drive each year. Drivers who log the highest mileage annually have the most to gain from a fuel economy advantage.

Now that you've estimated your annual mileage and fuel economy for a given vehicle, you're ready to grab a calculator and determine fuel costs using some simple math. Divide your annual mileage by your estimated fuel economy. Multiply the result by $3.80, the per-gallon gas cost used in the EPA estimate. This equals your annual fuel cost in dollars.

You can apply the same formula to other vehicles to compare fuel economy and costs among them. Just be sure that all the vehicles you're comparing use the same kind of fuel. Vehicles that require premium unleaded, for example, will be pricier to fuel than ones that run on regular gas. To account for premium fuel, change the fuel cost estimate from $3.80 per gallon to $4.00 per gallon.

Have a Long Commute?

On the right side of the new-car fuel economy label is the relative fuel cost compared to the average new car. The figure is given in dollars saved or spent over five years, assuming 15,000 miles per year and 23 mpg for the average vehicle. This is another part of the label that can be misleading if you're driving habits don't match the assumptions. Rather than rely on the figure on the label, use your customized annual fuel cost to compare between vehicles.

To illustrate a comparison, consider a 4-cylinder 2013 Toyota Camry sedan versus a V6-powered 2013 Toyota Highlander crossover. The Camry's window sticker shows annual fuel costs of $1,900, while the Highlander's shows $2,650 per year. That's a significant difference of $750 per year, or more than $60 in extra fuel expense per month for the Highlander.

But at 9,000 miles per year, the premium for driving the bigger and thirstier Highlander diminishes. At 20 mpg combined, the Highlander costs $1,710 to fuel over 9,000 miles (9,000 miles per year divided by 20 mpg multiplied by $3.80 per gallon equals $1,710 per year.) The annual fuel price for the Camry drops to $1,221. That's a difference of only $489 -- significantly less than the $750 displayed on the sticker.

The disparity is even more severe when using window stickers' cost savings over five years. For the 15,000-mile-per-year driver, it shows a difference of $3,750; the Camry "saves" drivers $2,000 over five years, while the Highlander "costs" drivers $1,750 more than the average over the same period. But, for the 9,000-mile-per-year driver, the difference between the costs of fuel for the two vehicles is considerably less: $2,445 over five years.

Alternately, a high-mileage driver would find that the window stickers underestimate the cost savings offered by the Camry.

If you drive 15,000 miles per year on a combination of city streets and highways, live in an average climate and drive with a moderate style, you can use the combined fuel economy and cost estimates listed on a new car's window sticker with no adjustments. But if your driving habits differ significantly from this profile, take some time to customize your fuel economy estimates and comparisons. You'll make a more informed car-buying decision and avoid the surprise of unexpected fuel costs.

How to Compare New Car Fuel Economy - Autotrader