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Carmakers Want Relief from Tough 2025 Mileage Mandate

Feds set to issue mid-term review of 54.5 mpg target.

by on Jul.05, 2016

Cheap gas makes it harder to justify spending money to improve mileage, CAFE critics contend.

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.

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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.

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Support Building for Obama Mileage Compromise

Industry, labor, political and environmental leaders lending support in advance of White House announcement.

by on Jul.28, 2011

The typical passenger car would have to deliver 56.2 mpg by 2025, but trucks would get slightly less.

While details are being withheld until tomorrow’s formal White House announcement, there’s a growing consensus building for the apparent compromise on the nation’s future fuel economy standard – one potentially major opponent signaling it is ready to sign on.

Reports that Toyota would oppose the proposed increase in the U.S. Corporate Average Fuel Economy, or CAFE, standard “are not accurate,” Group Vice President Bob Carter tells TheDetroitBureau.com. “Toyota is not going to fight the administration’s proposal.”

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Separately, a well-placed company official said it would be a self-destructive move for “the Prius company,” to try to scuttle the compromise that is expected to call for passenger cars to meet a 56.2 mile per gallon mandate by 2025.  To bring the industry onboard, President Obama apparently accepted a reduced 54.5 mpg target for pickups and other light trucks.

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White House Paring Back 2025 Fuel Economy Goal

Administration betting automakers, environmentalists can agree on 56 mpg compromise.

by on Jun.27, 2011

By compromising at 56 mpg, the White House hopes to develop consensus for new fuel economy standards.

While consumers may be demanding big increases in automotive fuel economy, the Obama Administration has apparently bowed to industry pressure as it prepares to set new mileage standards reaching out to 2025.

The White House reportedly has advised automakers and industry trade groups that it will look to boost the Corporate Average Fuel Economy, or CAFE, standard to 56.2 mpg.  That’s a big jump from the 37.5 mile per gallon target now in place for 2016, but significantly lower than the 62 mpg goal that the Environmental Protection Agency had originally been considering for the next bump in CAFE.

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The roughly 10% cut in the 2025 standard now under consideration reflects the changing political fortunes in Washington; indeed, the Republican-controlled House of Representatives has largely dismissed concerns about global warming, one of the factors that had led the EPA to consider a 62 mpg figure. Automakers, meanwhile, have been loudly arguing that this number could price most new car buyers out of the market and lead to sharp declines in industry earnings — and jobs.

But even the GOP and auto industry officials seem to recognize the mood of an electorate frustrated by this year’s near-record run-up in fuel prices — and worried by forecasts gas might soon nudge $5 a gallon.

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62 MPG Standard Could Add $10,000 to Cost of New Car

New study warns of sales collapse, loss of jobs.

by on Jun.15, 2011

To save fuel American motorists might have to spend heavily on new automotive technology, warns a new study.

With federal regulators studying the possibility of raising the Corporate Average Fuel Economy, or CAFE, standard to as much as 62 miles per gallon, a new study warns that such a move could increase the cost of the typical American automobile by as much as $10,000.

The report, by Ann Arbor, Michigan’s Center for Automotive Research, or CAR, also warns that annual automotive sales could tumble by as much as 5.5 million units, with motorists choosing to hang onto their existing vehicles longer rather than pay a steep price hike that will be difficult to make up in fuel cost savings.  In turn, said the CAR study, that could cost as many as 265,000 U.S. jobs.

“The risk,” warned the new report, “is serious.”

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But the new report is sharply contrasted by another study released this week which found that it might cost as little as $2,000 to adapt to a 62 mpg study, largely by adopting new technology to improve the time-tested internal combustion engine, rather than trying to switch to more advanced battery or hydrogen propulsion systems.

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California, Federal Regulators Agree to a Single Mileage Standard

Final decision expected by September 1.

by on Jan.26, 2011

A formal proposal for the 2025 CAFE standard is expected by September 1.

Facing the prospect of opposition from the new, Republican-controlled House of Representatives, federal regulators recently announced a delay in setting out proposed new fuel economy standards – which many have expected to push as high as 62 mpg by 2025.

But at least one challenge to raising the numbers appears to have been overcome.  The Department of Transportation, the Environmental Protection Agency – and the State of California – have all agreed they will speak with one voice, rather than releasing their own proposals and then trying to work out a very public compromise.

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Whatever the number, the government agencies involved in updating the Corporate Average Fuel Economy, or CAFE, standard plan to make their unified announcement by September 1.

“By working together with EPA and the California Air Resources Board to develop standards for the next generation of clean cars, we can set a standard that works for automakers across the country,” said Transportation Secretary Ray LaHood.

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