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.”
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.