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[Source: Wall Street Journal]
Photos Copyright ©2009 Sam Abuelsamid / Weblogs, Inc.

Reynolds explains that Toyota can sell big fuel-guzzling vehicles like the Tundra and Lexus LS because it also sells efficient vehicles like the Yaris and Corolla. While this is partly true because the fuel efficiency of the small cars does offset the higher consumption of the bigger vehicles when calculating the company's fleet average, there is more to the story. Toyota's big trucks have not been nearly as commercially successful as any of their domestic competitors. As a result, the penalty isn't nearly as big to offset. This is even more true for Nissan. Lexus' LS also sells in comparatively small numbers, with only 20,255 units moved in 2008.

The author does give due credit to Ford for its upcoming Fiesta and Chrysler for the Fiats it will soon sell, but goes on to trash General Motors for the upcoming U.S. market Cruze, a car which no one has driven yet. This is certainly disingenuous, since there is no guarantee that the Fiats will be any better than GM's offerings. We've driven the Fiesta and it's a great little car and the new Focus will likely be very good as well.

While the current Aveo leaves a lot to be desired, it's at the end of its life-cycle and will be replaced by the end of next year with a new American-built car. The Aveo replacement may be joined by the even smaller Spark, which should help matters.

The main point of Reynold's treatise is a complaint about fuel economy standards being an ineffective means to influence fuel consumption. To a large degree, he's correct as CAFE has limited influence unless fuel prices rise. Simply controlling what's supplied by automakers does not guarantee consumers will buy more expensive, fuel efficient vehicles. Reynolds advocates adjusting the taxes on fuel to make it equal on ethanol, gasoline and diesel at 24 cents a gallon.

While taxes could be adjusted, they will need to go substantially higher than Reynolds' suggestion if they're to have any real impact on consumer behavior. Thanks to Reuven for the tip!