In lifted 4WD trucks using much larger tires, owners say they often see a decrease in fuel economy. This leads me to wonder, how does tire size (specifically, outside diameter) affect efficiency?
In my way of thinking, a wheel/tire having a larger OD than stock would result in fewer engine RPMs at a given speed (say 60mph). Conversely, using a wheel/tire having a smaller OD than stock would increase engine RPMs at the same speed, thereby leading to more fuel consumption.
Am I on track?
It's got to do with physics.
A larger, heavier wheel equates to more rotating inertia, unsprung mass and rolling resistance that the engine has to work against during acceleration.
More work → more load → more fuel.
Breakdown of the effects
The rotating inertia and mass of a tire is:
Rolling resistance will increase with a tire's weight.
Larger wheels increase the frontal area of the vehicle, increasing the drag forces that the engine has to work against. Also, higher ground clearance caused by larger wheel diameter increases air vortices below the car, causing a higher coefficient of air resistance.
While it is true that the outer diameter affects engine RPM at any given speed (and gear), the impact on fuel economy is secondary to the impact of change in inertia. See this question on brake-specific fuel consumption BSFC for more information.
