The Fuel-Efficient SUV Is No Jumbo Shrimp

The Fuel-Efficient SUV Is No Jumbo Shrimp
A Range Rover on the assembly line
Photograph by Simon Dawson/Bloomberg

Remember when the SUV was king and then it wasn’t? It rules again. Carmakers that have long shied from high-riding off-roaders—(brands such as Rolls-Royce, Jaguar, and Mini—are close to building SUVs of their own.

This may come as a surprise to some. If you cast your memory back, the fuel-price spikes of the last decade, peaking in 2008, were supposed to drive a stake through the heart of the SUV. If that wasn’t enough, the financial crisis of the same year was supposed to be the finishing move of all finishing moves: Witness the death of GM’s Hummer division as evidence that the days of fat tires and thirsty V8s were coming to a close.

Why then, five years later, are we talking about a new raft of SUVs? Because cars got more efficient. The last few years have seen a sea change in the kinds of engines autos use. Larger, heavier V8s are increasingly being displaced by engines that are smaller and more efficient, but just as powerful.

If you wanted to buy a Range Rover back in, say, 2007, the car came with a 4.4-liter V8 that put out 300 horsepower and got an EPA combined rating (city and highway) of 14 miles per gallon. Shop for a new Range Rover today, and the base engine is now a supercharged 3-liter V6 that puts out 340 horsepower and gets 19 miles to the gallon. That doesn’t make the Range Rover a Prius, but it’s still a 36 percent increase in fuel efficiency.

And that’s with a gasoline engine. Go diesel, as with Audi’s Q5, which you can get with a 3-liter turbocharged diesel, and the combined EPA rating jumps to 27 miles per gallon. That’s 1 mpg better than Audi’s hybrid option, which is also available.

Carmakers have more to play with when it comes to the engines they put in cars. Add to that lighter materials such as high-strength steel and aluminum, engines that shut off when the car isn’t moving, and cylinder-deactivation systems, and there’s lots of things to tweak when it comes to reducing a car’s fuel consumption. That’s before you even get into plug-in hybrids, which can reduce a car’s reliance on gas to almost zero, in some situations.

What hasn’t changed is what Americans—and, increasingly, Chinese—like to drive: bigger cars. We like to sit high-up. We like the safety those things imply, and we like the idea, even if we never take advantage of it, that our cars could drive over hill and dale if needed. With better engines and other technologies, that doesn’t seem to be changing all that soon.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE