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EPA Reportedly Wants 25% Cut in Fuel Economy

Revised Trump plan would freeze CAFE at 2020 level.

by on Apr.30, 2018

The EPA's mileage rollback is coming just as gas prices start to surge. Critics warn automakers of a backlash if the numbers reach previous highs.

The EPA and NHTSA are expected to propose cutting the current federal fuel economy mandate by nearly 25% while also revoking the State of California’s ability to set its own tougher standards.

Embattled EPA Administrator Scott Pruitt has repeatedly signaled a desire to roll back the rules set under the Obama Administration that current target a fuel economy average of 54.5 mpg by 2025. Reports based on sources at the environmental agency indicate that would drop to 41.7 mpg, the figure that the phase-in of the Obama rules would have reached by 2020. There would be no further increase, under the proposal, until 2026.

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That has triggered an outcry from consumer and environmental groups, but an even more controversial piece of the EPA draft memo would forbid California from taking steps on its own to effectively neuter the rollback. Under current law the state can set tougher tailpipe rules than the EPA and other states can adopt California’s guideline, something that could effectively require automakers to stick with the current CAFE rules.

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Study Finds Strong Support for Keeping Mileage Rules Among Key Auto Suppliers

EPA expected to announce CAFE revisions by April 1.

by on Mar.22, 2018

The auto industry is waiting anxiously to see if and how the Trump Administration rewrites the current Corporate Average Fuel Economy mandate.

The Environmental Protection Agency is expected to announce revisions to federal mileage rules by April 1, but while a number of automakers are hoping to see a sharp cutback in the standards a new study finds key automotive suppliers hoping the Trump Administration will let the rules stand as they are, ramping up to 54.5 miles per gallon by 2025.

After completing a mandated mid-term review just before leaving office, the Obama Administration decided to maintain that target. But soon after President Donald Trump entered the White House, his EPA chief Scott Pruitt said he would revisit the Corporate Average Fuel Economy mandate, appearing to side with auto industry critics who complained CAFE was set to price many buyers out of the new car market.

Enviro-News!

The debate has led to an unusual split between automakers like Ford and General Motors, who want to roll back the rules, and a number of auto suppliers who support the 54.5 mpg target, according to several reports, including a new study by CALSTART, a California-based consortium aimed at developing clean transportation technologies.

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CAFE Rollback Wouldn’t Bring Much Change to Product Plans, Says Ford President

The big impact is likely to be on Ford’s sales mix.

by on Apr.11, 2017

Ford President Joe Hinrichs reveals the new Police Responder Hybrid at a New York preview.

President Donald Trump’s executive order reopening the “mid-term review” of federal fuel economy mandates will likely have a much smaller impact than critics have feared, according to a top Ford Motor Co. executive and other industry leaders.

Even if that review did lead to a rollback of the 54.5 mpg Corporate Average Fuel Economy, or CAFE, standards set to phase in between now and 2025, said Ford’s President of the America Joe Hinrichs, the maker’s long-term product plans are largely already in motion. If there’s any change, it will be in Ford’s sales mix.

The Inside Story!

“With the typical industry product cycle, which is five to six years, what’s we’re going to launch is already in the pipeline,” said Hinrichs, during the unveiling of a new hybrid police cruiser ahead of the annual New York International Auto Show.

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Automakers Look for Options, Weigh Costs Under Trump

Carmakers, car buyers, car workers might all feel the impact.

by on Jan.27, 2017

Pres. Donald Trump signing an Executive Order. He plans to enact a 20% Mexican tariff.

The increasingly contentious battle between the Trump Administration and Mexico could lead to some significant collateral damage, notably including both carmakers and car buyers.

With the Mexican government rejecting a White House demand to pay for a border wall, President Donald Trump now wants to not only negotiate the North American Free Trade Agreement but impose a 20% tariff on good imported from south of the border. After making extensive use of NAFTA to set up a network of manufacturing operations in Mexico, automakers could be among the hardest hit.

Beyond the Headlines!

But there is, for now, widespread disagreement about how to respond to the Trump plan. Japanese automakers Nissan and Toyota say they are looking for ways to increase U.S. production. Ford’s CEO, after meeting with the new president this week, is rejecting the idea of building any new U.S. factories. Meanwhile, Fiat Chrysler’s chief executive says it may be time to rethink the possibility of a merger with domestic giant General Motors.

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Trump to Meet with Detroit CEOs on Tuesday

Plenty of room for deal-making.

by on Jan.24, 2017

Will Trump use the carrot, the stick, or both, during his meeting with Detroit's Big 3 CEOs.

With an assortment of global leaders set to visit the White House in the coming weeks, President Donald Trump will first take time to meet with the CEOs of the Detroit Three automakers in the Oval Office this morning, and it’s expected there will be plenty on the agenda.

Trump has put a lot of emphasis on the auto industry since launching his campaign in 2015, notably taking shots at the largest of the two domestic makers for importing cars from Mexico. He has threatened to enact a “big border tax,” according to a tweet fired at General Motors earlier this month, scuttled the Trans-Pacific trade pact and advised both Mexico and Canada of his plan to renegotiate the NAFTA deal.

Breaking News!

While industry officials worry about the impact of new trade barriers, they’re also hoping to get a sympathetic ear from the new president on a variety of their own concerns, including corporate taxes and government regulations like the tough Corporate Average Fuel Economy, or CAFE, mandate the EPA reaffirmed in the final hours of the Obama Administration.

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