My theory is that all the car manufactures use this method to slow us down a little, which helps the car last longer and increase the gas mileage a bit.

I remember my moms 1959 Olds. It used some kind of twist speedometer. That thing was off 5 or 6 mph. That car always seemed slow till we clocked it using the mile markers ever mile at 60. Dad never did take it to get the mechanical plastic gear in the transmission changed out that would have fix the problem.

The ones in today's cars are probably from the front axles. They may be magnetic or infrared sensors sending pulses to the ecu. Then electronic from the ecu to the speedometer.

The police and highway patrol cars, Crown Victorias use a calibrated speedometer. In the old days a not to busy cop would go out on the road or highway and run a constant speed so you could see just how far off your speedometer was. Today they don't have the time.

Radar trailers - We have one just south of town right before the 40 mph zone. I doubt that trailer has been calibrated in a long time. My TCH at 45 read 43/44. It's usually only 1 mph slow at 45 and 2 mph slow at 60. I prefer using the mile markers, one minute at 60 or two minutes at 30. Seems like it takes 65 seconds or was it 70 seconds when driving at 50 mph. A fun thing to do on a very straight highway with thin traffic. I wait till the mileage post just crosses my right windshield bar.

 

In addition (if I understand the laws of physics) it can't possibly be 'accurate', since the speed is based (I believe) on the tire rotations. A 20" tire travels further than a 19" one does in each rotation. Further, and I know that this is minutia, but a new tire has more tread than and old one, as well, temperature will cause the tire to either expand or contract, creating further variances in the distance traveled with each rotation. These variances could easily subtract an inch or more of travel distance per rotation. A one inch difference in diameter is a 3.14" difference in distance traveled per rotation. With a 20" tire rotating over 1000 times per mile, the difference adds up, the 19" tire travels 230 feet less with the same number of revolutions.
I got straight A's in high school physics, but in 33 years, forgot almost all of it, so if I'm wrong...


For your entertainment... http://www.miata.net/garage/tirecalc.html


But I'll repeat my main concern...litigation. If these cars were found to be underreporting the actual speed, a (sleaze bag) lawyer would easily be able to pin a multi-billion dollar class action lawsuit on them for the harm they caused the consumer, that is, causing them to unwittingly speed and be subjected to fines, penalties and life threatening driving. "Your honor, I never would have sped. I always do the legal limit. It's the corporate greed that caused me to speed! Let's levy a fine on them to 'teach them a lesson'!" (or at least, that's how it goes in the US court system).