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Some government officials warn that pushing manufacturers to produce EVs will take away access to cheaper hybrids, diesels. Tesla Model S pictured above.  (Source: Tesla Motors)
All lawmakers in Washington aren't behind Obama's proposed CAFE standards

One of President Obama's many focuses these days seems to be ensuring that the U.S. has less dependence on foreign oil than it has today by time he leaves office. The Obama administration has been working hard with states and automakers to come to agreement on the CAFE regulations that will govern the required fleet wide fuel economy figures in the future.

The final standard that Obama is wanting forces a fleetwide average fuel economy of 54.5 mpg by 2025. That doesn't count heavy-duty trucks though; those types of vehicles have separate fuel economy standards to adhere too. This week, John D. Graham, who headed the Office of Information and Regulatory Affairs from 2001-2006, said that the Obama administration is overstating the benefits of the 54.5mpg fleetwide average.

Graham also criticized the plan to give automakers credits for building electric vehicles and failed to take into account the impact of generating the electricity the vehicles use. Graham also claims that Obama is overstating the long-term benefits of the increased fuel economy standards and is forecasting higher fuel prices than what the Energy Information Agency is predicting.

Graham is not alone in making claims that the CAFE standards aren't going to do what the Obama administration is claiming. Rep. Darrell Issa (R, CA), Chairman of the House Oversight and Government Reform Committee, went so far as to claim that giving double credits to automakers for EVs is akin to "fudging the numbers." Issa claims that automakers might be forced into building EVs at the expense of clean diesel or hybrid vehicles.

Starting in 2017, automakers will be able to use credits on EVs for less efficient vehicles in their fleet. Rep. Mike Kelly (R, PA) went so far as to say the 54.5mpg requirement would harm consumer choice and put the future of private transportation at risk.

"We're picking and choosing what people are allowed to drive and not drive or purchase," Kelly warned.

Graham echoed that statement, adding, "[One key issue for regulators] is whether the quest for more energy savings will inadvertently hurt consumers by causing vehicle manufacturers to produce cars and trucks that do not satisfy customer preferences for vehicle size, performance and/or safety.”

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RE: Bad
By Keeir on 9/16/2011 2:15:08 PM , Rating: 3
Errr... its very different.

An Airbag, or any discrete safety regulation, is a usually an on/off regulation. This creates a fair and even playing field and relatively small market distortion.

But its worth noting that in the United States, only 2 front airbags are required, and in the United Kingdom, no airbag is required provided the car passes certain safety standards.

Yet the Nissan Versa Sedan, the cheapest new car I can think of, comes standard with 6! airbags. Far exceeding the US base requirement. Hmmm... how can that be? The Nissan Versa also far exceeds the US safety requirements in many key area... because it wants to score highly on publically availible safety tests which are funded by the Government and Private Insurance.

Yet again, in the case of Airbags, regulation does not seem to create a significant addition. Consumer demand for the safest cars drive even the most basic cars to exceed the current US requirements. The original laws were just an attempt to steal credit by politicians.

With CAFE its even murkier. CAFE attempts to regulate the types of cars consumed by fining the producers of said cars.

Face with CAFE and a country that wants to consume large cars, trucks, etc, I might be tempted to produce large numbers of cheap fuel efficient cars at nearly no profit a unit in order to allow me to sell large numbers of high demand cars for a large profit. This was the stradegy of nearly every US car company!

Thanks CAFE for bringing us the SUV/CUV! Thanks CAFE for making it more profitable to sell one SUV than 10 small cars! Thanks CAFE for making it undesirable to make a quality/expensive small car!

CAFE comes with a whole host of unintented consquences and doesn't really acchieve it fundamental purpose. It you can't do something good or helpful, it might be better to do nothing at all.

"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer

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