The Case of the Missing High-Mileage Car

How would you like to drive from New York to Los Angeles with just one stop for gas? It seems incredible and wonderful, but it can happen. In late 2010, the Volkswagen Passat BlueMotion set a new world record for the “longest distance traveled by a standard production passenger car on a single tank of gas.” It travels 1,526.63 miles. It translates to a fuel economy of 75 miles per gallon.

Sweet! Only one thing — this passenger car is for the U.K. You can’t drive this car in the United States. We have a Passat, but it gets nowhere near this excellent mileage. Even stranger, many of the engines in these, which are driven all over Europe, are actually built in the U.S. The trouble is that it can’t jump through the regulatory hoops in the land of the free.

This fact was first brought to my attention by a video blogger who had been driving a van version of this amazing car in the U.K. He came home to ask his Volkswagen dealer about it. The dealer quickly informed him that this model is not allowed on U.S. roads. The Passat in Europe runs on a 54.1-fluid ounce common-rail four-cylinder engine. The standard in the U.S. is a 67.6-fluid ounce engine. For this reason and a few others, the version you can drive here gets 45 miles per gallon.

The blogger was furious as he reported this, and he further explained the absurdity. It seems that the emissions regulations are calculated based on a per gallon basis. The U.K. Passat does not pass because its emissions pollutants are slightly over regulation.

The blogger further pointed out the silliness: The car goes much farther than the American version on a single gallon, resulting in less overall pollutants. But that doesn’t matter, given the manner in which fuel-efficiency happens to be calculated. In the U.S., a car with low emissions could get 1 mile per gallon and pass, but one with slightly higher emissions couldn’t get through, even if it went 100 miles on a gallon.

Infuriating, yes. But because the video was widely circulated, the revisionists started getting to work to debunk the claim. One blogger called Volkswagen. The spokesman made several salient points. A gallon in the U.K. is actually slightly larger than in the U.S., thereby reducing the mileage disparity between the U.K. and U.S. models. Further, these 54.1 engines are actually not that popular in the U.S. market because Americans don’t really care that much about mileage. Finally, mileage is actually calculated differently in the U.K., so the cars aren’t quite comparable in this sense.

Now, that’s all very interesting, and provides an interesting corrective, but it begs the critical question: Can this record-breaking, high-mileage car be sold in the U.S.? It would appear that the claim of the original video blogger stands: It cannot. You might want this car. VW might want to sell it. Europeans love it. But we, as Americans, are not permitted to buy it, and VW is not permitted to sell it. Regardless of the details, these are facts. The VW spokesman was really just talking around the point, as all corporations do when they are confronted with the awfulness of regulations.

The original blogger suggested conspiracy. But then, there is Hanlon’s razor: Never attribute to conspiracy what can easily be explained by stupidity. Regulations are inherently stupid because they presume the perpetuation of an existing technology and production model. They can never account for change or improvement.

No matter how you write them, no matter how smart you are, there will come a time when the intended results of all regulations will reverse themselves. They will inhibit, rather than advance, progress. They will degrade, rather than improve, products. They will block, rather than inspire, technological improvement. This is an unavoidable fate, no matter how smart the regulators are.

In a private market, rules and standards adapt to change. This is because private parties get that the point of a rule or standard isn’t the rule or standard but the results. The point is to achieve results. If the exact reverse of the point is observed, the rule is changed over time. In this way, private markets are flexible in ways that government regulations can never be.

Let’s raise a point about another incredible and wonderful thing: the flying car. It appears that the Terrafugia “roadable aircraft” is finally going into production and might be available for purchase sometime next year. It has recently been subjected to vast media attention, and that’s all to the good.

Now, one might suppose that the journalism on this car would focus on what an amazing thing this really is, how it takes us a step toward the Jetsons’ world, how it might make a contribution to unclogging highways and so on.

But no, that’s not what the stories have been about. It seems that the major “work” that has gone into the engineering behind this flying car has nothing to do with making it amazing for you and me. It is all about the endless government regulations that have stood in its way. The bureaucrats, not the consumers, rule the day.

Imagine: It’s hard enough to build a car that complies with regulatory bureaus. It’s hard enough to build an airplane that complies with the mandates of regulatory bureaus. It appears to be darn near impossible to make something that complies with both! It has to pass emissions tests, crash tests, navigation tests, design tests, mileage tests and a million other tests. Then there’s the problem of licenses for the drivers and fliers and the compliance with airport and road regulations. What a nightmare! It seems that the bulk of the energy of the company has been spent on this.

The actual reality of the flying car has been around since the 1930s. It keeps being revived again and again. What’s making it flounder? The problem is that this innovation is neither fish nor fowl from the point of view of government bureaucrats. Therefore, they don’t know what to do with it.

The results are, quite frankly, rather disappointing. The Terrafugia is a small plane with foldable wings so that you can drive it around. That’s it. There will be no levitating out of traffic. There will be no landing in your driveway. You have to drive it like a car to the airport, and then take off, fly, land and drive home again. That’s kind of cool, yet it raises the question: Why not just park your car and hop in your airplane?

You have to have a wild imagination to see the world that would exist were it not for government controls. These controls wreck innovation. They deny us access to seeming utopias. They kill the entrepreneurial spirit and set society back. They thwart progress and forbid us from working toward a future that is better than the past.

We will never know what we are missing so long as we continue to allow government to throw the whole of society into a regulatory thicket. Life is pretty amazing, true, but it could be far more so. Instead, we suffer in ways we don’t know. This is the big, horrible picture.


Jeffrey Tucker

The Daily Reckoning