The term Malaise era refers to a period in the U.S. automotive industry from roughly the early 1970s through the early to mid 1980s, characterized by malaise: poor products and a generalized industry unease^[1] — an era of profound adjustment as the U.S. automotive industry adapted to meet wholly new demands for more fuel-efficient, safe and environmentally responsible products.

Following the 1950s and 1960s — the unregulated decades when the U.S. automotive industry could prioritize unrestrained horsepower,^[2] size and styling — the Malaise Era arose after the Clean Air Act of 1963 began to codify a legislative response to serious national car-generated air quality concerns, and Ralph Nader's 1965 Unsafe at Any Speed galvanized attention on U.S. automotive safety issues — calling for a range of safety features from critical occupant protection to car bumpers that could enable low-speed impact without damage to safety systems.^[3] With an average fuel economy across passenger cars from 1969-1974 of 13.5 mpg_‑US (17.4 L/100 km),^[4] the period coincided with the industry's dependence on inexpensive foreign oil and spiking international fuel prices, culminating with the 1973 oil crisis.

In response, the U.S. federal government introduced successively more comprehensive emissions, fuel efficiency and safety standards ^[5][6] — which for the first time required huge automotive engineering investments in effectively new disciplines — testing the industry's ability to adapt.^[7]

As a hallmark of the era, with automotive design budgets dominated by huge pragmatic investments in fuel efficiency, emissions controls and safety programs, the engine power of prominent sports and muscle cars of 1960s was decimated — and manufacturers often relied heavily on egregious badge engineering,^[8][9][10] and expedient styling tropes — all in stark contrast to prior decades of unbound automotive power and styling. The era also highlighted the U.S. automotive industry's vulnerability to penetration by foreign manufacturers versed in the design of more space and fuel efficient designs — and more quick to adapt.

When Ford introduced the Granada in 1975, it emphasized the padded vinyl roofing, opera windows, tufted velour interiors with imitation wood accents and stand up hood ornaments of its ostensible luxury — but used a platform dating to the austere 1961 Falcon and offered a power-to weight ratio 48.46 lbs per hp, and a breathtakingly slow 0-60 time of 23.15 seconds.^[11]

Recalling President Jimmy Carter's 1979 Malaise Speech, in which he discussed the oil crisis and a wider "crisis of confidence" within the United States, the term was coined by Murilee Martin writing for the website Jalopnik in 2007,^[12][13] has been in regular use since at least around 2012,^[14][15][16] and has been widely cited by news agencies and automotive sites, including Car and Driver,^[17] Consumer Guide,^[18] Forbes,^[19] Fox News,^[20] Hagerty,^[21] Hemmings Motor News,^[22] Motor Trend,^[23] Popular Mechanics,^[14] Road & Track,^[24] Vanity Fair,^[16] and the New York Times.^[25]

Though emissions and safety requirements had been first introduced in 1967, Phil Greden, a writer for Jalopnik,^[1][26] contends the era spanned specifically from 1975 with U.S. government bumper regulations; to 1983, when the Ford Mustang saw a significant performance increase after almost a decade of low performance.^[27][28]

Catalytic Exhaust Converter

Prominent U.S. 5-mph bumpers on a 1977 Mercedes-Benz 450 SLC

At the close of 1970, President Richard Nixon signed a series of amendments to the Clean Air Act into law.^[29] The amendments established the National Ambient Air Quality Standards (NAAQS), New Source Performance Standards (NSPS); and National Emissions Standards for Hazardous Air Pollutants (NESHAPs), and overall significantly strengthened federal enforcement authority, all toward achieving aggressive air pollution reduction goals. The amendments mandated a 90% reduction in hydrocarbons, carbon monoxide, and nitrogen oxides by 1975, relative to the 1970 standards, and instructed the Environmental Protection Agency—formally founded just that month—to implement these standards.^[30][31][32]

The technology did not exist to meet these requirements in a fashion that would also allow practical engines to continue making the same horsepower. The simplest way for manufacturers to meet these highly ambitious emissions cuts was to reduce power outputs in their vehicles – so, starting in 1971, horsepower ratings for many American automobiles began to markedly drop. It is important to note that a substantial part of these drops were merely on paper, caused by a concurrent legal change in the manner in which engine power was measured – shifting from gross to net horsepower (aligning the U.S. to the rest of the world in this respect) – which resulted in lower values although no change was made to the vehicle.^[33][34] For example, the 350 cu in (5.7 L) L48 engine of a 1971 Chevrolet Corvette was rated at 270 (gross) horsepower, but the identical engine was rated at 200 (net) horsepower in 1972.^[35] However, emission-driven detuning resulted in notable real power cuts, starting from the 1971 model year. These changes were initially due to a reduction in compression ratios to allow engines to run on lower octane unleaded gasoline rather than fuel using dangerous and polluting lead additives (a move taken initially by General Motors, but which all other major American automotive manufacturers adopted).^[36][37][38] Many automotive manufacturers dropped horsepower ratings from their advertising, using cubic inch engine size instead.^{[citation needed]}

More significant power reduction effects were caused by the adoption or increased use of emissions control procedures such as secondary air injectors (often called "smog pumps"), exhaust gas recirculation, retarded ignition, and thermal reactors. For example, Pontiac’s 455 cu. in. V8 peaked at 310 net horsepower in 1973, but was down to 200 net hp in its last year of use, in 1976. As these changes were legislative in nature rather than the result of voluntary developments by American car companies, as well as aggressive in scope and with a rapid deadline, the emission control technologies used were hastily implemented and initially resulted in reliability issues, creating stalls and reducing fuel economy over and above power drops.^[30][31][32]

The new emission standards also spurred the deployment of the catalytic converter, added to almost all new vehicles from the 1975 model year onward, which in turn resulted in the increasing adoption of unleaded gasoline, as the converters could not function if leaded gasoline was used.^[31][39][40]

In addition to new environmental standards, new design standards had a significant effect as well. Starting in 1971, the National Highway Traffic Safety Administration (NHTSA) promulgated bumper regulations requiring specific bumper performance requirements in collisions from passenger vehicles (but not light duty trucks and motorcycles) at certain low speeds and angles. Specifically, this mandated the vehicle sustain no damage at 5 mph (8 km/h), at an exact bumper height. Except for Canada, no other nation adopted this mandate.^[41]

In 1982, the U.S. relaxed this rule to 3 mph (4.8 km/h) collision, where it remains.^{[41][42] [43][44]}

This increased bumper size and weight beginning with the 1973 model year, and these standards were further tightened for the 1974 model year.^[45][46]

The regulations specified bumper performance; they did not prescribe any particular bumper design. Nevertheless, similar to how emissions standards were tackled, automotive manufacturers often at first took the simplest path. ^{[citation needed]} Cars were equipped with bulky, unsightly, protruding bumpers to be compliant.^[41] This meant additional vehicle length and greater weight.^[47][48]

Bumpers today are designed very differently from those during the 5-mph bumper era, in that they are made of foam to avoid the weight of rigid steel bars at vehicle extremities, prioritizing occupant crumple zone protection over insurance claims.^[49]

The 1973 oil crisis caused a sudden and marked increase in the cost of oil and, by extension, gasoline. By the end of the crisis, in March 1974, the price of oil had nearly quadrupled, from U.S. $3 per barrel ($21 in 2023 dollars^[50]) to nearly $12 globally ($82 in 2023 dollars^[50]); U.S. prices were significantly higher.^[51] The result was a sudden switch in consumer taste from traditional domestic automobiles with high gas-consumption rates to more efficient compact cars.^[52]

The shift towards smaller, more efficient vehicles benefitted foreign manufacturers, who produced more of such vehicles. By 1975, 18.3% of U.S. sales were imported cars.^[53] American brands had their slowest year since 1962, selling just 7,050,120 cars in 1975. By comparison, they sold 9.6 million cars in 1973.^[53] The success of Japanese brands can be traced to the greater selection of compact cars and the development of technologies to improve fuel efficiency. For example, Honda's CVCC technology allowed its cars to pass emission standards without a catalytic converter.^[54]

Sales of larger domestic cars would rebound, but the 1979 oil crisis caused oil and gas prices to again increase significantly, doubling over 12 months, and there was a further shift in customer preference to smaller, more efficient vehicles.^[52]

The EPA began regulating for fuel efficiency in this period. The Corporate Average Fuel Economy (CAFE) standard was passed into law in 1975, requiring that the fuel economy of a manufacturer’s entire output of passenger car and light truck models be averaged into a miles-per-gallon fuel economy standard, which was then in turn used as the basis for further legislation. For example, in 1978 Congress mandated that manufacturers achieve a fleet average of 18 mpg by 1978, 19 mpg by 1979, and 20 mpg by 1980, rising to 27.5 mpg by 1985. Similarly, the 1978 Energy Tax Act levied a "gas-guzzler" tax to the sale of new vehicles that failed to meet CAFE standards, as an attempt to discourage the creation and purchase of inefficient vehicles.^[5][55][56] By the approximate close of the malaise era in 1983, average fuel efficiency for passenger cars had not met these targets, but had risen to 17.1 mpg_‑US (13.8 L/100 km).^[4]

The cumulative effect of these changes on the car lineups of American manufacturers was a series of redesigns and discontinuations of engine types and vehicle models and an overall lowering of performance. Ford, General Motors and Chrysler also called upon their European divisions who had the necessary expertise in designing smaller, more fuel efficient vehicles, and in some cases adapted their European designs for the US market. Ford for instance, imported the 1970 Mercury Capri and its first generation 1978 Fiesta, whilst GM leveraged its Opel division to design the sub-compact/compact T-body and J-body platforms. Chrysler opted to bring entire models drawn from its European subsidiaries Rootes and Simca, respectively the 1972 Plymouth Cricket and the jointly developed Dodge Omni/Plymouth Horizon.

The first generation Mustang was cancelled after the 1973 model year, replaced with the Ford Mustang II, a platform which in its first year was over a foot shorter in length and some 800 pounds lighter, but also peaked at 105 net horsepower compared to the previous years' (already emission-reduced) maximum of 266 net horsepower.^[57][58] Some cars were redesigned to fit in entirely different automotive categories: the Mercury Cougar and the Dodge Charger were transformed from muscle cars to personal luxury cars for the 1974 and 1975 model years, respectively, while the Chevrolet Nova became a luxury-oriented compact. Chevrolet continued to offer its Chevelle, but discontinued its SS performance option after the 1973 model year,^[59] while the AMC Javelin, Dodge Challenger, Plymouth Barracuda, and Pontiac GTO were all cancelled entirely after the 1974 model year.

American automakers began introducing smaller, less powerful and more fuel efficient models to comply with new mileage requirements and compete against foreign manufacturers, particularly the Japanese offerings.^[60][61] Regardless, the sales of imports continued to climb. In 1978, GM sold over 5 million cars, but by 1982 they sold about 3.5 million, a decrease of 34.2%. Other American manufacturers saw similar losses; Ford sales fell 47% and Chrysler sales dropped 27% from 1978 to 1982. In the same years, Toyota sales increased from 441,800 cars to 527,128 cars, a 19.3% increase. Japanese automakers Honda and Datsun saw increases of 33.1% and 39.1% respectively.^[52] A year after the onset of the 1979 oil crisis, Japanese manufacturers surpassed Detroit's production totals, becoming first in the world. Indeed, the share of Japanese cars in U.S. auto purchases rose from 9% in 1976 to 21% in 1980.^[62]

As the industry adapted to new emissions, efficiency and safety demands and the fuel crisis receded, vehicle performance began to increase again as technologies matured: onboard computers, electronic fuel injection, three-way catalytic converter and modern oxygen sensors enabled greater raw performance and less hobbling emission controls.^[63] Writing for Hagerty, Rob Sass argues that the era ended between 1985—when American commercial sports cars such as the Ford Mustang and Buick Regal reached the 200 hp mark again—and 1987, when the U.S. national speed limit was raised from 55 mph (89 km/h) (a fuel-saving measure enacted in 1974^[64]) to 65 mph (105 km/h).^[63]

Numerous journalists have reflected on the reduced performance and perceived aesthetic deficiencies of cars offered to Americans in this era.^[65][66][67] One journalist described this period of automotive history as the "worst era in car design".^[68] Another journalist wrote that cars of this era were "bloated, underpowered, and uninspired".^[69]

Despite complaints against cars from this era and claims that they would never appreciate in value,^[70] select vehicles from the 1970s and 1980s started becoming more popular in the late 2010s.^[71][72] Their increase in popularity led to the creation of car shows dedicated only to cars from this era.^[73] According to the Hagerty Price Guide, these cars have recently seen the greatest increase in value when compared to other used cars: 82% of used cars saw no increase in price in 2018, but cars from the 1970s and 1980s increased in value by 24% and 38% respectively in the same year.^[71]

• Corporate average fuel economy