Talks between the automotive industry and
Washington continue as both sides try to come to an agreement that sees the
environmentalists in Washington and the Obama administration happy with the
CAFE standards over the coming years. The automakers are fighting for what they
consider a more realistic level of improvement in fuel economy they need to
build into cars each year.
Delegations from Michigan where much of the
automotive industry calls home have raised
concerns about the Obama administration's efforts to come to an
agreement. The delegation from Michigan wrote a letter to Washington claiming
that the proposed fuel economy standards aren't feasible. Automakers fear that
the costs of implementing the fuel economy increases will add enough to vehicle
prices to decrease sales and thereby force job
cuts in the automotive industry.
The letter written by the Michigan delegation
said, "With the Michigan unemployment rate standing at 10.5 percent, we
are unanimous in our concern about the consequences of an excessive proposal,
and we urge you to continue to work closely with U.S. manufacturers who have
the most at stake." The letter continued, "[Congress has urged the
White House to] sit down promptly and at one time with all three domestic auto
manufacturers and the United Auto Workers to work through an acceptable
So far, there has been no agreement between the
two parties. The proposed
fleet standard for 2025 is 56.2 mpg working out to about a 5% increase in fuel
economy each year from now until 2025. The Obama administration figures that
the cost of the tech needed to reach that kind of fuel economy will add about
$2,100 to the cost of each new vehicle. That number has been greatly contested.
Washington already took
a step back from the new fuel economy standards and the increase of
5% in fuel economy each year on light trucks by agreeing to hold trucks and
SUVs to only 3.5% increase each year from 2017 to 2021. Washington and
automakers are also trying to hammer out a deal on work trucks that would see less
quote: Same thing is true for car and truck engines. While the peak power output does negatively impact efficiency at cruise, it's not as big an impact as most people think.