By helping increase the number of ethanol-fueled vehicles, Ford Motor Co. and Chrysler Corp. also reap extra fuel-economy credits from the government.
Those extra credits are important because consumers' appetite for fuel-hungry trucks, sport-utilities and minivans apparently has dragged the Big 3's truck fleet corporate average fuel economy averages below the government standard of 20.7 mpg for the 1997 model year.
According to estimates from the National Highway Traffic Safety Administration, the Big 3 will miss the truck CAFE target for the 1997 model year.
The Big 3 have run out of credits from previous years to make up for the shortfall. But if an automaker's 1997 truck fleet CAFE falls under the limit, it has until 2000 to generate credits to make up for the deficit before fines can be imposed.
Chrysler will make all its 1998 minivans equipped with the 3.3-liter V-6 capable of running on E85 - a mixture of 85 percent ethanol and 15 percent gasoline.
By doing so, Chrysler can get as much as 6.6 times the minivans' combined city/highway fuel economy for CAFE calculations - even if the vehicle is always run on straight gasoline.
But just how much CAFE credit an automaker earns also depends on sales volume.
Chrysler's announcement in early June came after Ford unveiled plans to build 250,000 ethanol-burning vehicles over the next three to four years. Ford plans to build 50,000 to 60,000 Ranger pickups with the 3.0-liter V-6 engine in the 1999 model year, and also has plans for a flex-fuel version of the Windstar minivan.
If Ford had sold 50,000 flex-fuel Rangers during the 1996 model year, it would have added 0.35 mpg to the automaker's truck CAFE of 20.9 mpg, a spokeswoman said. Ford currently sells about 5,000 flex-fuel Taurus sedans a year, but that adds less than 0.1 mpg to its car CAFE.
Chrysler expects to build about 180,000 minivans with the flexible-fuel powertrain for the 1998 model year. In the 1997 model year, the 3.3-liter V-6 was the standard engine on the Dodge Caravan LE and Chrysler Town & Country SX and LX models.
Ford and Chrysler won't charge consumers extra for ethanol-burning vehicles, even though the fuel tank, lines and fuel pump are upgraded to stainless steel because of the corrosive fuel. Other changes to the vehicles include an in-line fuel sensor and a new engine control computer.
Representatives from both Ford and Chrysler stress that the flexible-fuel vehicles are part of the automakers' commitment to producing cleaner vehicles. Neither automaker is apologizing that the move earns extra CAFE credits.
'The government was faced with a chicken-and-egg situation, so it set up a deal,' said John Wallace, director of alternative fuel vehicles at Ford. 'This is not an incentive we just pulled off the floor. It's been on the books to break this infrastructure logjam, and we're doing it.
'We don't apologize for this. If Congress didn't want us to do it, why didn't they tell us?'
Use of ethanol-powered vehicles will help automakers meet U.S. standards for light-truck fuel economy. CAFE estimates in mpg, for 1997 model year:
Dom. car Imp. car Light truck
Chrysler 27.9 27.3 20.2
Ford 27.2 31.9 19.9
GM 28.1 31.5 20.4
Standard 27.5 27.5 20.7
Source: National Highway Traffic Safety Administration