A landmark case in the Victorian Supreme Court has set a precedent for government-mandated fuel rating label figures for more than 15 million new cars sold in Australia over the past 20 years.
The ruling could have far reaching implications for vehicle manufacturers whose customers cannot match real-world fuel consumption with fuel rating label estimates.
Two years ago, a consumer tribunal ordered Mitsubishi to refund the $39,500 purchase price of a Mitsubishi Triton ute because it used significantly more fuel than “misleading and deceptive” figures published on the vehicle’s fuel consumption rating label.
In June 2019, the Victorian Civil and Administrative Tribunal (VCAT) ruled against Mitsubishi and in favour of the customer, Mr Zelko Begovic, who had kept a log of his fuel use over an extended period.
Mr Begovic demonstrated his vehicle used significantly more than the official fuel consumption rating label data, which indicated the 2016 Mitsubishi Triton should be more efficient than his previous 2008 Mitsubishi Triton.
Tests by a Mitsubishi technician and an independent fuel economy expert also could not match the estimates on the Mitsubishi Triton’s fuel rating label.
Mitsubishi Australia appealed the VCAT decision and now, almost two years on, the Supreme Court of Victoria has also ruled in favour of the customer, finding the data on the labels “misleading and deceptive”.
However the Supreme Court of Victoria dismissed two other allegations and found Mitsubishi's fuel economy tests complied with the law and the customer vehicle at the centre of the dispute was not defective.
Fuel consumption rating labels became mandatory in Australia in 2001 and were designed to provide consumers like-for-like fuel use comparisons across various vehicles.
Since 2001, more than 15 million cars sold in Australia have been equipped with the labels which are displayed on a vehicle's windscreen at their point of sale.
Above: An example of a fuel consumption rating label on a Toyota LandCruiser on showroom display.
Fuel rating labels are still mandatory on all new cars sold today, although they can be removed once the car has been delivered to the customer.
However, fuel consumption rating labels do not use the word “estimate” to describe figures for city, highway, and average use. Instead, in fine print the label warns: “Actual fuel consumption … depends on factors such as traffic conditions, vehicle condition and how you drive.”
Fuel rating label figures are derived from laboratory tests (pictured below) so they can be repeated in identical conditions in different countries, rather than based on real-world driving scenarios.
However, over time, car companies have developed techniques to optimise fuel consumption results during the laboratory tests.
Independent analysis has shown the gap between fuel rating label figures and real-world driving figures has widened over the past two decades.
The difference between real-world fuel consumption and rating label figures was about 10 per cent in 2002, grew to 35 per cent in 2014, and in 2017 was projected to be 49 per cent higher than published claims by 2020, as manufacturers found ways to optimise laboratory tests.
In Europe, the automotive industry is in the process of moving to real-world driving fuel consumption data, which requires a portable laboratory to be fitted to a test vehicle while it is being driven (pictured above and below).
Australia still uses laboratory testing protocols mandated since July 2003, and there are no current plans to move to more accurate fuel economy rating labels.
“If this Supreme Court ruling is allowed to stand, then the Australian government will need to update its fuel economy test procedures,” said an automotive industry insider. “The car makers have done nothing wrong, other than conduct laboratory tests according to the current regulations.”
In 2017, the Australia Automobile Association (AAA) found real-world testing among a range of new cars were using “up to 59 per cent more fuel and emitting up to seven times the legal limit of some noxious emissions than indicated by laboratory-only tests”.
The AAA found real-world consumption was, on average, 21 per cent higher than the rating label claim figures on the 30 popular cars tested as part of the preliminary study.
At the time, AAA chief executive Michael Bradley said: “It’s becoming clear … the gap between laboratory results and real-world results is widening, meaning consumers and the environment are increasingly being ripped off.”
The two Mitsubishi Triton utes at the centre of Australia’s landmark legal dispute – the customer’s original 2008 model and the new 2016 model he bought as a replacement vehicle – displayed consumption rating label figures derived from laboratory tests, as with all new cars sold over the same period and to the present day.
Mr Begovic’s 2008 Mitsubishi Triton fuel rating label displayed an estimated consumption rate of 7.8 litres per 100km in highway use, while his 2016 Mitsubishi Triton fuel rating label displayed an estimated consumption rate of 6.8 litres per 100km in highway use, a 12.8 per cent decrease.
However, Mr Begovic found, in his experience, his 2016 Mitsubishi Triton delivered a 24 per cent increase in real-world fuel consumption compared to his 2008 Mitsubishi Triton.
Mr Begovic produced figures that showed his 2016 Mitsubishi Triton used an average of 12.44 litres per 100km in his driving routine, versus about 10 litres per 100km for the same driving routine in his 2008 Mitsubishi Triton.
Given the reduction in fuel consumption estimates on the 2008 versus 2016 fuel rating labels, Mr Begovic had expected his 2016 Mitsubishi Triton to use about 8.5 litres per 100km in his driving routine.
Further, the 2016 Mitsubishi Triton’s real-world fuel use of 12.44 litres per 100km compared to the 6.8L/100km claim for open road driving, the 9.0L/100km claim for urban driving, and the 7.6L/100km claim for a combination of urban and highway driving.
Last week, the Supreme Court of Victoria upheld the earlier finding of the Victorian consumer tribunal that the figures on the 2016 Mitsubishi Triton’s fuel rating label – affixed to the vehicle at the point of sale – were “misleading and deceptive”.
The Supreme Court heard Mr Begovic purchased the 2016 Mitsubishi Triton in part due to its reduction in the claimed fuel consumption versus his 2008 Mitsubishi Triton, and he had relied on the data published on the fuel rating labels when deciding to buy the vehicle.
In addition to fuel rating labels, historical fuel economy data claims are also published on the Australian government's Green Vehicle Guide website.
VCAT had earlier found Mr Begovic’s 2016 Mitsubishi Triton “used more fuel” than the 2008 Mitsubishi Triton “in the same driving conditions” – even though the labels claimed that the 2016 model was “more fuel-efficient than the 2008 model”.
Last week, Supreme Court of Victoria judge Tim Ginnane found the customer’s 2016 Mitsubishi Triton was not defective and Mitsubishi had complied with the law and had not manipulated fuel economy laboratory tests, dismissing two of the three original judgments made by VCAT.
However, Justice Ginnane upheld VCAT’s verdict that the information on the 2016 Mitsubishi Triton fuel economy label was “misleading and deceptive”.
Justice Ginnane said that because VCAT “erred in law” on two of the three allegations, “its orders terminating the contract and ordering the refunding of the purchase price could not be made”.
Mitsubishi Australia says it is considering its next course of action, whether to launch another appeal, or accept the findings.
A statement issued by Mitsubishi Motors Australia said the company “takes its obligation to comply with the law very seriously”.
“We were pleased to see that there is no suggestion that Mitsubishi Motors did anything other than to comply with the law when conducting the Government mandated fuel consumption tests it depends upon to publish like-for-like consumer comparison data on the Government mandated-fuel consumption labels,” the Mitsubishi statement said.
“We are taking further advice regarding our options (in this matter). In light of that, it is not appropriate for Mitsubishi Motors Australia Limited to comment on this matter further.”
In the original VCAT hearing two years ago, Mitsubishi argued Mr Begovic had fitted accessories to the vehicle such as a canopy, a “shade cloth style mesh to the front grille”, and switched to all-terrain tyres rather than highway tyres, which Mitsubishi claimed could have an impact on fuel consumption.
VCAT found Mr Begovic – who had collected 19 fuel receipts and kept a log book from January 2017 to May 2018 – “presented as an honest witness who gave his evidence unguardedly and without exaggeration”.
The VCAT hearing also heard evidence from independent vehicle emissions expert, Andrea Winkelmann, who at the time had 25 years’ experience as an automotive engineer, having previously worked for Ford and Holden.
Ms Winkelmann at the time worked for independent vehicle emissions firm ABMARC in Australia – which specialises in real-world fuel economy tests and assessed 30 popular cars on behalf of the AAA in 2016 and 2017.
According to tests by ABMARC, Mr Begovic’s Mitsubishi Triton used 26.6 per cent more fuel than claimed on the rating label in the “combined” cycle, 17.8 per cent more fuel than claimed on the rating label in the “urban” test, and 36.8 per cent more fuel than claimed on the rating label in the “extra-urban” test (also known as highway driving).
Ms Winkelmann described the anomalies between real-world consumption of Mr Begovic's 2016 Mitsubishi Triton and the fuel consumption rating label estimates as “unusual and excessive”.
In back-to-back tests ordered by VCAT in August 2018, a Mitsubishi technician also could not match the Mitsubishi Triton’s fuel consumption rating label figure.
Court documents reveal Mr Begovic drove a pre-determined route for two of the three tests, and the Mitsubishi technician completed the route in Mr Begovic’s car once on the same route.
The vehicle returned a consumption average of 8.5L/100km from all three tests, which was higher than the 6.8L/100km estimate on the rating label for highway use, higher than the 7.6L/100km estimate on the rating label for city and highway use, but less than the 9.0L/100km estimate on the rating label for urban-only use.
For these tests, Mr Begovic’s 2016 Mitsubishi Triton was refitted with original highway-terrain tyres rather than the all-terrain tyres that had been fitted by Mr Begovic.
Independent testing has shown off-road tyres can affect fuel consumption by up to 20 per cent. However, even with the original tyres, real-world testing showed the 2016 Mitsubishi Triton used more fuel than claimed on the consumption rating label.
The official fuel rating label figures for the most recent update to the Mitsubishi Triton – released in 2019 after Mr Begovic commenced legal action – were higher than the official fuel rating label figures for his 2016 Mitsubishi Triton.
Mitsubishi says the increased fuel consumption rating label figures for the subsequent 2019 Mitsubishi Triton update (pictured below) were due to additional weight and a change in the aerodynamics of the vehicle's bodywork, which are used to determine the parameters for the laboratory tests.