With fuel prices the lowest they’ve been since the start of the Great Recession, automakers have seen a boom in demand for light trucks and performance vehicles. But while that might be good for the short-term bottom line, it could pose serious problems in the longer-term, as the industry struggles to cope with tough new fuel economy mandates.
Automakers have delivered significant improvements in fuel economy in recent years, but they’ve got a long way to go to meet the 54.5 mile-per-gallon target the federal government has set for 2025. Some industry insiders argue they can’t get there – at least not without pricing vehicles out of the hands of most consumers. The environmental community has countered that this is just a scare tactic and that manufacturers have shown they can deliver fuel-efficient products consumers can afford.
Both sides will have their eyes on Washington this week, the federal government finally expected to release a so-called mid-term review that could decide whether to ease back on the 54.5 mpg target if the goal is determined to be unreasonable.