Print 70 comment(s) - last by jimhsu.. on Jul 27 at 3:56 PM

Concession would make fuel economy standards easier for large trucks  (Source: Dodge)
Concession would reduce the yearly increase rate for new standards for large trucks and SUVs to 3.5% per year

The Obama administration wants to significantly increase the CAFE standards that govern fleet wide fuel economy for automakers. The problem is that there is a huge amount of backlash from those in the automotive industry. The backlash is so far keeping the Obama administration and automakers from coming to an agreement on proposed fuel economy standards moving into the future.

The Obama administration has put a concession forward in an effort to woo the Big 3 automakers to agree to the economy standards. The concession would see the makers of big trucks and SUVs forced to move to the higher fuel economy standards at a much slower rate than makers of cars and light SUVs. Hopes are high that the agreement between the Obama administration and the Big 3 will be made by early next week. 

Washington wants the CAFE requirements to be set at 56 mpg by 2025. The concession would allow the Big 3 to adopt the CAFE standards for the larger, gas guzzling vehicles, at a rate of 3.5% per year rather than the 5% annual improvement rate that the Obama administration wants for light trucks, cars, and light SUVs.

CAFE standards are currently targeting 35.5 mpg fleet wide by 2016 and that number will grow to 56 mpg by 2025 under the proposed regulations. The final rules are hoped to be ready by September.

However, automakers outside the Big 3 are not happy at all about the proposed concession. Carmakers that do not produce large SUVs and trucks see the concessions as giving the Big 3 an unfair advantage. The companies feel that the concession would encourage consumers to buy less efficient vehicles. 

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RE: I see SUVs selling very well
By kraeper on 7/15/2011 3:07:06 PM , Rating: 5
If gas prices go up, people buy more efficient cars. No legislation is required. If people buy more efficient cars, automakers make more efficient cars to compete with eachother. Again, no legislation required.

RE: I see SUVs selling very well
By nolisi on 7/15/11, Rating: -1
RE: I see SUVs selling very well
By 91TTZ on 7/15/2011 4:49:27 PM , Rating: 5
Great idea, let's not prepare businesses who rely on heavy, expensive, inefficient vehicles to run operations. Let's pretend like they can all afford to replace their fleets all at once.

Markets are customer driven. If customers demand something, supply will meet the demand. When the oil crisis hit in the 1970's, automakers initially had no fuel efficient vehicles. Within a very short period of time they were making small, fuel efficient vehicles because the market demanded it. With the cost of fuel so high, the manufacturer who could make the most fuel efficient cars made the most profit. Eventually, the fuel shortage ended and gas became cheap again. Suddenly, customers demanded larger vehicles. The small efficient vehicles were still available but they no longer sold well because customers wanted something else.

That's how business works.

RE: I see SUVs selling very well
By Samus on 7/16/11, Rating: -1
RE: I see SUVs selling very well
By Mr772 on 7/16/2011 9:34:25 AM , Rating: 1
We agree with you too. We have the population enslaved with debt and we now run/own the governments too and pretty much the world. The currency depreciation, I wouldn't worry about that either if I were you - it's not like you can do anything about it.

Thanks for your support,

~The Bankers~

RE: I see SUVs selling very well
By knutjb on 7/17/2011 9:21:12 PM , Rating: 3
Otherwise we'd all still be driving death traps without catalytic convertors that get 10mpg. But they'd also only cost $4000... You weigh the benifits and I'm sure you'll reconsider. Having a $20,000 safe car that is quiet, doesn't pollute much and gets 40mpg is far better than the $4000 alternative.
In the mid 1920s Henry Ford saw many friends lose their lives in car accidents. The 1927 Model A Ford had safety glass, an all metal body and wheels.
In the mid-fifties Ford had a padded dash and, hold on, seat belts as an option but few bought them.

Perfect vehicles, no but the manufacturer did it long before the nanny state dictated contradictory single-minded regulations. That is force very high MPG & safety standards before all material development and costs allow for any profit margin, gotta stay in business too.

Your "only the government can do it" ideology is mostly misplaced. When most people are shown the reason for such products, i.e. crash footage with and without safety devices few willingly go without. Oversight on manufacturer claims, yes. Dictating the market place, really?...

BTW If you ever had the chance to go into a junkyard in the 70s-80s you would not have found many burnt Pintos but you would have found many burnt Datsuns and Toyotas. I saw them there.

RE: I see SUVs selling very well
By tastyratz on 7/19/2011 9:19:25 AM , Rating: 1
Dare I play devils advocate and mildly agree with you even though it will get me rated to oblivion for the opposing view?
The issue argued is that the market dictates consumer need by demand. This is true unfortunately this is not ahead of the curve. Look at how pathetic we let cafe standards remain for how many years then all of a sudden this is a hot button to ramp things up once consumers demanded it. Had this been a government concern and a very slow reasonable gradual requirement till now we might have found ourselves there.

At this point the government is pushing too hard for too much too soon too late. We should have been looking at these thins YEARS ago and seem to think we can legislate them out of thin air. I do not support the recent hard cut cafe standards and I think American standards are keeping us from getting MANY of the great vehicles perfectly good for the rest of the world, but I do believe some regulation is needed to continue the trend, just a lighter hand. People live in the now, but manufacturers take YEARS to develop. The issue is with the size of the market, and OP is right. We would probably still drive unsafe polluting cheap cars and have no choice about it because it would be manufacturer dictated.

RE: I see SUVs selling very well
By Philippine Mango on 7/16/2011 1:11:52 AM , Rating: 2
You would hope, but I think the issue people have is that they fail at economics and their priorities are all screwed up. I mean when you have people paying $0.20, $0.30, $0.50 per kilowatt hour and you tell them straight up that if they replace this bulb here, refrigerator here or their swimming pool pump with something more efficient, that it will PAY FOR ITSELF in a years time or less and still won't do it, you know there is something wrong. Instead, they will only replace the items when it actually breaks, and not at the point when it is no longer cost effective.

RE: I see SUVs selling very well
By mindless1 on 7/16/2011 5:06:00 PM , Rating: 3
It's because they aren't dumb. There's always a tradeoff of some sort whether it be inferior lighting, higher up front cost, vanishing profit once you account for the interest on the money spent, general longevity of the replacement goods, repairability of replacement goods, etc, etc.

Further, it is wasteful to throw away something that still works. There was energy, time, natural resources spent on the replacement product.

I don't know about you but I'm not paying remotely close to $0.30, let alone $0.50 per KWH. I'd buy a natural gas generator if electrical prices were so steep. In the end we need to quit thinking greedily and look at the bigger picture. Our energy needs ARE GOING UP, the only sane solution is to ramp up nuclear plant production.

Once we do that, we can gracefully transition to new products that conserve energy once they have matured into being as reliable as those they are replacing.

RE: I see SUVs selling very well
By jimhsu on 7/27/2011 3:56:48 PM , Rating: 2
A wise man once said that all societal problems - fossil fuels, poverty, war, hunger, etc -- can ultimately be reduced to a problem of energy. Energy production, energy distribution, name it. Ironically energy conservation also falls into that same category.

"So, I think the same thing of the music industry. They can't say that they're losing money, you know what I'm saying. They just probably don't have the same surplus that they had." -- Wu-Tang Clan founder RZA

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