{"id":39850,"date":"2011-06-15T09:33:32","date_gmt":"2011-06-15T13:33:32","guid":{"rendered":"http:\/\/www.thedetroitbureau.com\/?p=39850"},"modified":"2011-06-15T09:33:32","modified_gmt":"2011-06-15T13:33:32","slug":"62-mpg-standard-could-add-10000-to-cost-of-new-car","status":"publish","type":"post","link":"https:\/\/thedetroitbureau.com\/2011\/06\/62-mpg-standard-could-add-10000-to-cost-of-new-car\/","title":{"rendered":"62 MPG Standard Could Add $10,000 to Cost of New Car"},"content":{"rendered":"
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To save fuel American motorists might have to spend heavily on new automotive technology, warns a new study.<\/figcaption><\/figure>\n

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.<\/p>\n

The report, by Ann Arbor, Michigan\u2019s 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.\u00a0 In turn, said the CAR study, that could cost as many as 265,000 U.S. jobs.<\/p>\n

\u201cThe risk,\u201d warned the new report, \u201cis serious.\u201d<\/p>\n

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News, Reviews and More!<\/figcaption><\/figure>\n

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.<\/p>\n

The new CAR study appears to assume that more advanced technologies would be needed to meet future mandates, such as the 62 mpg standard the EPA is considering for 2025, which would mark a more than 60% jump from the current 37.5 mpg target set for 2016.<\/p>\n

\u201cConsumers will shun these technology costs by holding onto their used vehicles longer, especially if fuel prices are low,\u201d perhaps around $3.50 a gallon, the CAR study stated, \u201cresulting in lower sales and a loss of automotive employment. Over 260,000 jobs may be lost if the highest mandate is passed and fuel prices stay.\u201d<\/p>\n

The 62 mpg standard would require an annual improvement in fuel economy of around 6%.\u00a0 Regulators are under pressure to scale back, if not abandon the mileage standards entirely, and are looking at lower numbers, possibly in the range of 47 mpg.<\/p>\n

But even if the U.S. holds off on boosting CAFE, the industry won\u2019t be entirely off the hook.\u00a0 European bureaucrats are taking an even more aggressive approach.\u00a0 The Continental concern is global-warming CO2, and they are expected to mandate a sharp reduction in the emission of that gas. Since CO2 production is directly linked to fuel consumption, however, the Europeans may effectively demand an increase to somewhere around 100 mpg.<\/p>\n

The new CAR study runs in conflict, meanwhile, with another new report prepared by the Boston Consulting Group.\u00a0 (<\/em>Click Here<\/span><\/a> for the full story.)<\/em> <\/strong>While CAR warns vehicle prices could surge by as much as 28%, the BCG analysis projects that by 2020 the cost of meeting new fuel economy mandates in the U.S. would add only about $2,000, or about 7% of today\u2019s typical vehicle price.\u00a0 That could readily be made up by owners in terms of fuel savings, especially if gas prices rise, as many analysts anticipate.<\/p>\n

The BCG study contends advanced gasoline engine technologies, such as direct injection and turbocharging, can achieve significant gains, minimizing the need for a wholesale switch to electric propulsion.\u00a0 In fact, the consultancy anticipates that all forms of battery-based vehicles will capture barely a 15% share of the worldwide automotive market by 2020.<\/p>\n

The huge gap between the two studies was not lost on various industry watchers.\u00a0\u00a0 On one extreme, conservatives used the CAR data to warn against the Obama Administration\u2019s proposed mileage hikes.\u00a0 But the Union of Concerned Scientists countered that the Michigan group\u2019s report was little more than \u201cpropaganda\u201d for those who prefer the status quo.<\/p>\n

The CAR study explored the expansion of automotive safety standards as well as increased mileage regulations, and cautioned that new mandates will increase the cost of a car by $1,500 by 2025.<\/p>\n","protected":false},"excerpt":{"rendered":"

A new study warns the typical motorist may face a $10,000 price hike, by 2025 to cover the cost of more fuel-efficient vehicles, which could slam demand for new cars and cost hundreds of thousands of jobs. More from TheDetroitBureau.com.<\/p>\n","protected":false},"author":2,"featured_media":38102,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","footnotes":""},"categories":[8],"tags":[],"make":[],"post-state":[],"category_old":[151],"acf":[],"_links":{"self":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/posts\/39850"}],"collection":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/comments?post=39850"}],"version-history":[{"count":0,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/posts\/39850\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/media\/38102"}],"wp:attachment":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/media?parent=39850"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/categories?post=39850"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/tags?post=39850"},{"taxonomy":"make","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/make?post=39850"},{"taxonomy":"post-state","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/post-state?post=39850"},{"taxonomy":"category_old","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/category_old?post=39850"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}