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Automakers claim new fuel economy ratings will put hundreds of thousands out of work  (Source: Business Week)
Supporters of increased efficiency standards claim the numbers are inflated

The battle between the auto industry and the federal government over changes to fuel economy regulations is exploding. Lawmakers in Washington want to impose much more efficient standards on future vehicles that could see a fleet wide fuel economy average of 62 mpg in effect by 2025.

Some in the automotive industry argue that the costs to reach the lofty 62 mpg fleet wide average will be much higher than the cost of burning more fuel in less efficient vehicles for consumers. Automakers have previously claimed that the costs would have a dire impact on the industry.

new study by the Center for Automotive Research has been published and the study claims that the rise in efficiency standards by 2025 to 62 mpg could add up to $9,790 to the cost of a new vehicle and will reduce sales by 5.5 million units. The report also claims that the resultant price increase would force a reduction of 260,000 automotive industry jobs due to reduced demand for vehicles by consumers.

On the other side of the battle, those pushing for the increased efficiency standards claim that the tech needed to meet the efficiency standards would only add $770 to $3,500 to the price of a new vehicle.

David Friedman, deputy director of the Union of Concerned Scientists' Clean Vehicles program and supporter of the new efficiency mandate, said, "The Obama administration should ignore this industry-advocate propaganda piece and focus on setting the strongest vehicle efficiency and global warming pollution standards based on credible scientific analysis."

President and CEO of the Union, Jay Baron, says that the main difference in cost between the industry and government studies depends on how much the price of the technology will come down over the next 15 years.



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So what
By Smilin on 6/15/2011 2:23:03 PM , Rating: 3
Ok, I'll buy the doomsday scenario and believe the $10k**

So what?

That's 15 years out:
Go look at auto prices from 1996.
Go look at your income in 1996.
Now make your own wild assed prediction of fuel prices in 2025.

Wrap it all up and yes, things will be more expensive but not by much.

**(for argument sake only...Automakers are doing some pretty incredible stuff today with just the classic non-diesel ICE. Both interested parties here have fed us a load of crap about CAFE in the past and I think the truth is probably somewhere in the middle)




RE: So what
By RussianSensation on 6/15/2011 2:44:48 PM , Rating: 2
Inflation has outpaced wage growth for most people in the last decade (or more). As a result, real wages have actually declined. So in fact, things only get more expensive with time relative to your wage. The reason your standard of living is largely improving is primarily a result of innovations in the technology and medical fields. However, if you were to compare the cost of modern education, food, energy, etc. they have all become many times more expensive relative to today's average earnings.


RE: So what
By Smilin on 6/15/2011 3:17:13 PM , Rating: 2
You assume I'm not outrunning the rest of the pack.

There will be 9 billion people on this planet pretty soon. A greater and greater percentage of them will be poor. Overpriced food will be more of a concern than an overpriced car.

The point regarding increased standard of living because of technology is an interesting one. While my powertrain might go up $10k do you still think they'll be charging $2500 for a built in entertainment and NAV system?


RE: So what
By surt on 6/15/2011 4:10:58 PM , Rating: 2
No, a nav/entertainment system will run $5k by then, but it will project holograms of your driving route and holographic movies.


RE: So what
By Smilin on 6/15/2011 4:14:06 PM , Rating: 2
hehe that will be the fancy one. Todays one will be the ghetto equivalent of manual roll down windows and cost $5.


RE: So what
By GuinnessKMF on 6/15/2011 2:44:58 PM , Rating: 2
So what you're saying is that if the government kept its hands off regulating the fuel efficiency requirements of vehicles the free market would turn out in such a way that it would make economic sense for the auto-makers to make their vehicles fuel efficient on their own?

Weird how that works out.


RE: So what
By Smilin on 6/15/2011 3:11:59 PM , Rating: 2
If you oversimplify things I say to the point where they have little meaning then they won't be hard to debate. Good tactic so long as you don't get called on it.

The market is focused on the now and has no regard for the future. It will *begin* to generate more fuel efficient vehicles *after* there is a demand for them. If it takes 10 years to develop suitable technology then the consumer will just have to deal with without it for that long.


RE: So what
By GuinnessKMF on 6/15/2011 3:17:31 PM , Rating: 2
I like to make fun of big companies too, but you honestly think they aren't already developing new systems with fuel efficiency in mind?

They just won't bring them to market until they're economically a net gain, so the OP arguing that it will make economic sense to have fuel efficient vehicles by then is not a pro or a con on regulating standards.


RE: So what
By Smilin on 6/15/2011 3:36:04 PM , Rating: 3
They are thinking of what will sell, not fuel efficiency. When the two align then progress gets made.

*More* progress gets made when you point a gun at them.

Checkout progress on MPG over the last 60 years. Efficiency will wallow with no improvement unless one of two things happens: The govornment regulates or an oil crisis of some sort happens.

The problem: When a crisis happens there is a delay in relief while the market turns like a big boat to the new direction. Our auto industry knows peak oil will happen but their customers aren't thinking that far into the future so there isn't a demand do do anything.

History shows the automakers suck at predicting crisis-based demand. Honda and Toyota (that came from where the market demanded more efficiency) came in and kicked the big 3 in the balls during the 80s. Flash forward 30 years and did they learn a lesson? Lot after lot full of marked down Hummers during $4/gal gas... nope, they didn't.

Regulation or crisis. One is proactive, one is reactive. The first one sucks. The second one sucks worse.

The only thing that wouldn't suck is just having cheap gas forever.. and unicorns.


RE: So what
By Smilin on 6/15/2011 3:41:57 PM , Rating: 2
PS: I don't like having to "point a gun at them". Really I don't.

You don't always like what's good for you though.

My daughter hates taking an allergy med so I have to armtwist every !#$ morning to make it happen. It sucks. She hates it; I hate it. But... come noontime if she hasn't then she'll come running to me asking for it then be miserable while she waits for it to kick in.

I'm not a huge analogy fan but I hope that helps explain my view some.


RE: So what
By Spuke on 6/16/2011 12:34:54 AM , Rating: 2
quote:
I'm not a huge analogy fan but I hope that helps explain my view some.
Your first explanation was good.


RE: So what
By Reclaimer77 on 6/16/11, Rating: -1
RE: So what
By mindless1 on 6/15/2011 3:00:25 PM , Rating: 2
I suspect you don't understand what they mean. They aren't suggesting cars in 2025 will cost $10k more than they do now, rather than they will cost $10k additional cost over what they would have risen to by 2025.

You are acting as though this isn't a big increase but it is! Did you think if car costs go up it won't trickle into other markets and the cost of everything doesn't go up too by an additional amount over what it otherwise would have due only to normal inflation?

I do agree the truth is probably somewhere in the middle, one camp claims $770-3,500 (averages out to $2,135) and the other claims $10k. The middle is then ($2135+10000)/2 = $6,068

One thing is clear, the nonsense has to stop. IF enough people want to pay extra for these vehicles, that's called a market niche and an automaker can choose to make vehicles that will (or won't) sell in this market segment. If there aren't enough potential buyers, it's a clear sign the public does not want them and so, the will of the public should be reflected by the actions (or lack thereof) of the government in ceasing this madness.

Let technological merit sell itself IF it is worth the cost. Cramming things down peoples throats based on some ana!ized ideals about fuel economy won't make a difference, in the grand scheme of things we will run out of oil to meet demand eventually, whether it happens on one particular date or 20 years later isn't very significant in the grand scheme of things. Our reduction in oil consumption is trivial compared to world wide use for other purposes and especially increase in use by emerging countries.


RE: So what
By Smilin on 6/15/2011 4:12:28 PM , Rating: 2
quote:
I suspect you don't understand what they mean. They aren't suggesting cars in 2025 will cost $10k more than they do now, rather than they will cost $10k additional cost over what they would have risen to by 2025.


I get it but I have no choice but to be a bit loose with their assumptions. WTF does $10k mean? You mean if I have a $9000 car getting 50mpg that it will double in price to reach 61? Or do you mean a $70k car with 10mpg will get 51mpg improvement for *only* $10k?

See what I mean? The number is utter bullshti without any context. Numbers are so easy to lie with.

quote:
You are acting as though this isn't a big increase but it is! Did you think if car costs go up it won't trickle into other markets and the cost of everything doesn't go up too by an additional amount over what it otherwise would have due only to normal inflation?

That's a pretty big improvement in efficiency so no, I don't think $10k is that much. Do I think it would trickle elsewhere in the economy? Complicated question. Lemme kinda dodge and pose some different ones: If the US could make a big investment now then run the whole economy with ultra low cost energy later do you think it would put us at an advantage? Do expensive efficient vehicles remain expensive after economies of scale are reached? Do other components in the car not drop in price to compensate (I'm looking at you, $2500 headrest DVDs !@$#!)

I'm not a believer that the free market can fix everything. I just believe it's the best system we have. In fact I kinda side with that CEO of Shell Oil in this regard. We're going to run out of oil. When that happens there will be a scramble to keep the gears of the world turning. It would be best to plan ahead and avoid the scramble. The free market is not capable of making this transition smoothly left all on it's own.

quote:
Our reduction in oil consumption is trivial compared to world wide use for other purposes and especially increase in use by emerging countries.

We're still the #1 consumer for now but China will overtake soon. I think it would be best if China (and others) are utterly F*cked when the oil runs out while we chug along using solutions we sacrificed to develop today.

I know there are tree hugging socialists out there. I'm not one. Nor am I some 'murrican who thinks I can just gobble up the worlds resources because I'm free to do what I want.


RE: So what
By FITCamaro on 6/15/2011 4:25:46 PM , Rating: 2
quote:
I think it would be best if China (and others) are utterly F*cked when the oil runs out while we chug along using solutions we sacrificed to develop today.


If we invest in the RIGHT solutions, we won't have to worry about much change or running out.

Biofuels (algae based diesel or gasoline) can replace fossil fuels for vehicles. Yes that doesn't help us for things like plastic and tires though.

And China can easily switch to electric since they have the resources to make the cars and don't have the hippies protesting nuclear power there.


RE: So what
By Nutzo on 6/15/2011 6:21:51 PM , Rating: 2
China is building hydro-electric plants, and will build nuclear as needed. No need to spend millions in studies just to have the approval overturned by some liberal judge at the last minute.



RE: So what
By Spuke on 6/16/2011 12:43:56 AM , Rating: 2
quote:
And China can easily switch to electric since they have the resources to make the cars and don't have the hippies protesting nuclear power there.
As their population grows and becomes more "involved" in their market, it will be harder and more expensive for them to switch. If they were smart, they'd skip oil and go for electric now. But they're going to be just as entrenched (probably more so) as everyone else. All IMO.


RE: So what
By mindless1 on 6/16/2011 3:45:20 PM , Rating: 2
I take it to mean something like, if the average price of a fuel economical car in 2025 would otherwise be $28,000, it becomes $38,000. That doesn't seem too excessive an estimate to me considering it would probably require electric power, motors and battery pack and the government can't subsidize cars forever.

The numbers don't add up from the big investment. The modest change in passenger vehicle fuel efficiency has to be weighed against total global oil consumption. The government is insisting on only a little more fuel economy but at great expense to achieve it. I mean only a little more compared to what it would be the expected achievement in 2025 w/o the mandates, based on historical engine efficiency improvements over the past decades, once you factor that the automobiles have crept up in size and weight.


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