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  (Source: dougburson.com)
The Alliance of Automobile Manufacturers asked that some credits be given to automakers that improve technology to meet 2012-2016 requirements

The Alliance of Automobile Manufacturers approached the Obama Administration earlier this week to request the use of credits to meet the proposed fuel efficiency standards.

Last year, major automakers, the state of California, and the White House agreed on the new Corporate Average Fuel Economy (CAFE) proposal that would boost fleet wide fuel economy to 54.5 mpg by 2025. The effort aims to reduce greenhouse gas emissions and lessen the country's dependency on foreign oil. The new rules also included a mid-term review to make sure that the 2021-2025 requirements are probable, which the Alliance of Automobile Manufacturers also addressed this week.

The Alliance of Automobile Manufacturers, which represents Toyota Motor Corp., Detroit's Big Three automakers and eight other automakers, has requested that carmakers obtain some credits for improving technology to meet 2012-2016 requirements set by the new fuel efficiency standards proposal instead of automakers only receiving credits if they are "in use in a minimum percentage of its overall fleet."

"Providing this program feature in the earlier years improves the usefulness of the credit program and encourages manufacturers to introduce the listed technologies sooner," said the Alliance of Automobile Manufacturers.

More specifically, the Alliance of Automobile Manufacturers would like automakers to obtain some credits for improving active grill shutters, start-stop technology, air conditioning and high efficiency lights for the 2012-2016 technology requirements.

The Alliance of Automobile Manufacturers also asked that the U.S. Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) explain the mid-term evaluation process as well as the specifics that will be reviewed. In addition, automakers want to know that the "timeline and procedures for assuring that the studies relied upon by the agencies are appropriately peer reviewed."

Automakers added that they shouldn't be held responsible for emissions from electricity generation from EVs.

"Automakers may now be called on to not only make an unprecedented investment into vehicles with lower emissions, but to also fill the void between this rulemaking and a comprehensive national energy policy," said the automakers.

The new rules are expected to save drivers $1.7 trillion at the pump, but the National Automobile Dealers Association (NADA) said last month that the new proposal could add as much as $5,000 to the sticker price of a new vehicle in 2025.

Source: The Detroit News



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consumer choice
By kattanna on 2/14/2012 12:15:57 PM , Rating: 2
the one thing that annoys me about this is that it is reducing choice. They are acting like everyone would be buying a new fuel efficient car if only they were available, but they are.

If peoples only concern was fuel efficiency, then people would only be buying prius style cars, yet they are not.

would I love a 54MPG V8 SUV, you bet. but its not possible due to basic physics.




RE: consumer choice
By Ringold on 2/14/2012 1:05:18 PM , Rating: 2
Meanwhile, while government micromanages the car industry, Navistar, entirely of their own according based on consumer desires and market forces, is starting to join others in building natural-gas powered engines for trucks, in coordination with an agreement with Flying-J and that other national truck stop chain (name escapes me at the moment) to start a mass deployment of nat-gas refueling terminals.

Googling for the news, I see the media is now attaching it to a tax break for nat-gas powered commercial vehicles Obama recently announced, but what I'd read prior suggested this was in the works before Obama jumped on the bandwagon (which really was just during his State of the Union).


RE: consumer choice
By Keeir on 2/14/2012 1:07:34 PM , Rating: 2
quote:
would I love a 54MPG V8 SUV, you bet. but its not possible due to basic physics.


When powered by a gasoline internal combustion engine.

(I agree completely. Once your have set the size and wieght of a car, it becomes really difficult to go past certain milestones. Using Otto Cycle engines, it difficult to see how the medium/large SUVs would ever be capable of more than 30 MPG on EPA testing)


RE: consumer choice
By Reclaimer77 on 2/14/2012 1:19:43 PM , Rating: 2
CAFE is an illegal and unconstitutional mandate. It needs to be stopped. The Federal Government has no right, whatsoever, to involve itself in matters of consumer choice.

You nailed it. They are essentially tell us what kind of vehicles can be made, thus which one we'll be able to purchase. That's an unacceptable use of Government power and influence.

This combined with the economy-killing subsidies for EV's are a clear and present threat to capitalism and the auto industry at large.


RE: consumer choice
By spread on 2/14/12, Rating: -1
RE: consumer choice
By Keeir on 2/14/2012 3:37:36 PM , Rating: 4
quote:
That's only something that GM can do. The company that pioneered planned obsolescence and the worst mass produced engines in the world.


What? Please explain how one company in a free market dicates consumer choice.

I'm also a little concerned about the inability to understand "planned" obsolescene.

Any product that can be made will wear out eventually. A company ensuring that thier product

A. Lasts at least as long as expected
B. Doesn't last (Cost!) significant more

Is doing the ethical thing. They are matching thier goods, services, and costs to customer expectations. Any company that doesn't plan the lifecycle of their products is well... not very well run.


RE: consumer choice
By x10Unit1 on 2/14/12, Rating: 0
RE: consumer choice
By Spuke on 2/14/2012 5:13:33 PM , Rating: 2
quote:
Why build a product that can last a lifetime when you can build something that forces the customer to buy again in a shorter amount of time that you can control(to a certain extent)?
I suppose on your planet, both of these products would cost exactly the same. Not going to happen ever. You're probably one of those idiots that thinks EV's will eventually cost $20k too. Also, as long as man makes something, it will ALWAYS break whether planned or not.


RE: consumer choice
By Keeir on 2/14/2012 5:24:38 PM , Rating: 2
quote:
You're probably one of those idiots that thinks EV's will eventually cost $20k too.


The Leaf is a ~36,000 dollar EV. I am sure you could strip it some more and make it essentially a 33,000 dollar EV. The Leaf's battery pack cost ~20,000 dollar in 2010 pricing. Therefore, without any other cost savings, if the battery now cost 7,000 dollars, then we would have the "20k" EV.

http://dukespace.lib.duke.edu/dspace/bitstream/han...

Its entirely possible for this to occur (albiet in 15-20 years) using an extrapolation of existing price reduction lines. Now I am talking 20k in 2010 dollars.


RE: consumer choice
By Black1969ta on 2/15/2012 1:53:53 AM , Rating: 2
price reduction timeline? last time I checked a 3 cent piece pf Bubble Gum was...25 cents! What? Where is the price reduction.
Initial price reduction of new technologies only occurs in the short term, as manufacturing sets up and facilities recover initial R&D and other acquirement costs. After that there is the slow, sometimes slower than others, but inevitable march of inflation.


RE: consumer choice
By Spuke on 2/15/2012 12:17:51 PM , Rating: 2
quote:
Its entirely possible for this to occur (albiet in 15-20 years) using an extrapolation of existing price reduction lines. Now I am talking 20k in 2010 dollars.
Seriously Keeir, now you're being ridiculous. Car prices have gone only UP. How does car pricing, especially using "new" tech and a fresh set of new government mandates, going to go down? That does NOT makes ANY sense at all and it NOT in keeping with reality (which is car prices continuing to RISE like it has been).


RE: consumer choice
By Keeir on 2/15/2012 2:06:50 PM , Rating: 2
quote:
That does NOT makes ANY sense at all and it NOT in keeping with reality (which is car prices continuing to RISE like it has been).


There are some problems.

#1. Car prices have steadily fallen. Yes fallen.

Fundamentally it doesn't make sense to compare absolute figures of prices. Inflation occurs. If you anchor prices to one year, say 2010, you'd discover that cars cost more in 1980-1990 and 1990-2000 and 2000-2009 then they do today.

http://www.usinflationcalculator.com/inflation/his...

For instance, between 1991 and today, there has roughly been 65% inflation.

A Civic CRX, HF, Base was 9,400... thats 15,500 in 2011 cash. An Si? 11,400 ... 18,800.

A Nissan Versa today? 11,000. Honda Civic seems to base around 15,500... and its a whole class above the CRX.

#2. The primary component in an EV in terms of cost is the battery. It comprises 60-75% of the cost of the Leaf for instance. Battery prices have fallen both relative to inflation and absolutely. That is simple fact. If battery prices continue to fall, then EVs will both relatively fall in price AND absolutely fall in price.

Consider that in 1996, EV-1 was estimated to cost upto 80,000 1996 dollars. A Leaf costs 35,000 in 2010 dollars. Thats a REAL ABSOLUTE price fall. It has already happened... which I tend to call reality.

#3.
I think the real statement should have been (your intention)

The price of a C-Segment EV will never be the same as a C-Segment ICE.

However following existing establish price falls in just one component (batteries) this is likely to occur within 15 years. IE, no new technology folks. Any new or improved battery technology could cause it to occur even faster, but that is of course uncertain.


RE: consumer choice
By Keeir on 2/14/2012 5:14:46 PM , Rating: 4
quote:
Here I will explain: If a product is planned to stop working/break after a certain time then the customer would be forced to buy another product. Why build a product that can last a lifetime when you can build something that forces the customer to buy again in a shorter amount of time that you can control(to a certain extent)?


And let me explain something.

If I buy a product from Company X that breaks/wears out in Y time that is 1/2 of expected time, when I go to replace it, I will be very tempted to buy Company Z's product instead of Company X. But of course if Company Z's product cost 1.5-2 times more the Company X, I probably would buy Company X's product again.

The truth is that any product has a cost versus durability curve. The more durable the product, the higher the cost. Reducing durability leads to lower cost, but reducing it too far leds to lost market share.

Many times customers place little to no value on durability that is significantly increased past a fixed point in time.

For example, If I had a cell phone that lasted 3 years and could sell it you for free with a 2 year contract versus a cell phone that lasted 5 years and could sell it to you for 100 dollars with a 2 year contract... most would take the free cell phone since the expected lifespan is 2 years. Is it wrong for the company then to plan a 3 year lifespan instead of a 5 year or a 10 year?

If a cell phone maker though made phones that barely lasted 1 year, it wouldn't be too long before people -stopped- getting the "free" cell phone.

Gosh isn't this what happened to GM? Didn't people start buying foriegn cars because they provided valued durability more than the cost increase? Didn't GM respond (eventually) by producing more and more durable cars?

quote:
I would be concerned as well if you don't understand what is now widely used concept.


At one point, most people widely thought the earth was flat.

Now there are many products I would be gladly willing to pay a premium to buy for longer lifespan. I am often unable to find these products at any price... but I am not angry at the company, it is the shortsightiness of my fellow consumers that drive the situation.


RE: consumer choice
By Keeir on 2/14/2012 3:49:22 PM , Rating: 2
quote:
CAFE is an illegal and unconstitutional mandate. It needs to be stopped. The Federal Government has no right, whatsoever, to involve itself in matters of consumer choice.


You left out ineffective, inefficient and political chicanery.

Fuel prices are far more effective than CAFE in promoting fuel efficient technologies.

http://en.wikipedia.org/wiki/File:CAFEStandard2.pn...

The government gets to "take" credit without the "blame" of additional costs. The government is given a new toy to play with to promote adgendas obscured from public view (read about how CAFE is calculated at the EPA if you wonder)


RE: consumer choice
By Spuke on 2/14/2012 5:15:17 PM , Rating: 2
quote:
Fuel prices are far more effective than CAFE in promoting fuel efficient technologies.
Bingo! What's funny is that todays fuel efficiency has nothing to do with CAFE and is all demand driven.


RE: consumer choice
By Reclaimer77 on 2/14/2012 9:50:32 PM , Rating: 1
quote:
You left out ineffective, inefficient and political chicanery.


Hey you know me. I'm right there with you on that.

I believe that the Constitution authorizes only two federal mandates ---

1. The federal government may require a state to nationalize its militia.

2. The federal government must require the states to have republican forms of government.

Compare that to the thousands and thousands of federal mandates placed on the States. Who are supposed to be sovereign.

I'm convinced this is our biggest problem. The mandates and the centralizing power effect they cause.


RE: consumer choice
By superstition on 2/15/2012 5:17:34 PM , Rating: 2
The Articles of Confederation sailed.

You're out of time.


RE: consumer choice
By JediJeb on 2/15/2012 5:59:58 PM , Rating: 2
Look at any governments over the centuries and you will definitely see that when each large empire began to centralize all of its power into one place under a small number of people, that empire began its decline from a relatively high peak.

Roman Empire, Colonial Brittan, Babylonian Empire, Persian Empire, Ancient Egypt, Soviet Union, and many others. Most began with a period of expansion under a popular leader, where the conquered territories were governed by local leaders. Then as time progressed the central government, usually by then in the hands of other leaders, begins to want more power and takes away the autonomy of the local leaders. Once the mandates of the central government no longer coincide with the beliefs and ideals of the citizens of the local governments unrest begins to rise. At this point the decline begins and almost always ends in the destruction of that empire. If the US keeps going the way it has, things don't look so good for our future.


RE: consumer choice
By Qapa on 2/19/2012 11:12:35 AM , Rating: 2
I understand that fuel prices is the easiest way to motivate consumer's demand for lower fuel consumption.

But it is also a complex matter, since people who can't afford that much, and may have gotten a car recently would have it's car value plummet, might have difficulties in maintaining it, and probably wouldn't be able to buy another... The same people, in the scenario where companies are improving the products, can keep their cars along with their expectations of cost of ownership...


RE: consumer choice
By jRaskell on 2/14/2012 1:22:55 PM , Rating: 2
I have yet to see the evidence supporting that claim.

You can currently still buy a high horsepower V8 sports car.
You can currently still buy a large/fullsize V8 SUV.

So long as a significant portion of the consumer market are interested in purchasing those vehicles, manufacturers will continue to build and sell them.

And while you'll likely never see either of those categories of vehicles obtaining 50+mpg, they'll both benefit from improved fuel mileage as a result of these mandates.

Of course, it's also true, as noted in the articles, that all these vehicles are going to come with significantly increased sticker prices as well.


RE: consumer choice
By Reclaimer77 on 2/14/12, Rating: 0
RE: consumer choice
By Keeir on 2/14/2012 3:41:57 PM , Rating: 1
You have an interesting viewpoint.

On one hand, you assert that the Free Market will fulfill customer desires, but in the same point you say the Free Market needs to be guided to fulfill customer desires. (And assert that its being correctly guided)

Interesting contradiction.


RE: consumer choice
By retrospooty on 2/14/2012 4:48:39 PM , Rating: 1
Seems pretty clear to me. He is saying that as long as people are buying the V8 SUV's etc. , the Auto makers will keep making them. At the same time, the smaller cars can be pushed to get better mileage.

There isnt an either/or mandate. Both can exist.


RE: consumer choice
By Keeir on 2/14/2012 5:01:13 PM , Rating: 2
Errr.. you seem to have the same problem.

See if you can follow.

The consumers want more fuel efficient technologies, therefore the government must intervene and push smaller more fuel efficient cars by mandate. But if consumers want larger less efficient cars, the free market will fight against a government mandate to provide them. WAH.

In one situation, the poster is trusting the free market.

In another situation, the poster is praising government intervention into the free market.

There doesn't seem to be a monoploy or externality (at least not shared by both) so having a different viewpoint on the same situation seems... well... hard to follow.

Now there may be other reasons like "Its socially responsible to drive smaller cars, so its perfectly alright for the government to force people to buy smaller/more fuel efficient cars than they actual want to purchase". I am fine with that as a position, its at least internally consistent. But it must be acknowledged as fundamental that the government is biasing people away from their normal choices and thus limited their choice. I am not sure how it could be described any other way.


RE: consumer choice
By retrospooty on 2/14/2012 5:25:44 PM , Rating: 1
Just breath man. it will all be OK.

I see it like this. At some point the endless spihon of gas will run short. it will likely be political, or possibly supply based, but at some point, demand will outdo supply and when it happens, prices will skyrocket, and the ecomony of the entire planet will crash, and crash hard.

If we aren't pushing these technologies, when it happens, we will be screwed. Not might be screwed, we will be screwed, all of us.

The free market cant/wont see that. The free market will buy V8 SUV's until a crisis happens. When the crisis happens, its way too late to start develpoing alternative tech. We need to develop now. So why not develop and live at the same time simultaneously?


RE: consumer choice
By Keeir on 2/14/2012 5:35:46 PM , Rating: 2
quote:
I see it like this. At some point the endless spihon of gas will run short. it will likely be political, or possibly supply based, but at some point, demand will outdo supply and when it happens, prices will skyrocket, and the ecomony of the entire planet will crash, and crash hard.


Any idea when this is going to occur? I mean, I am fairly sure we have seen predicted dates for "peak" oil come and go.

quote:
The free market cant/wont see that. The free market will buy V8 SUV's until a crisis happens.


No. The free market will purchase vechile capacites whoose understood long term cost is less than the long term value placed on the cars.

Believe it or not, the "Free" market responds very well to raising prices without CAFE interference.
http://en.wikipedia.org/wiki/File:CAFEStandard2.pn...

And the entire time your assuming I think CAFE is wrong (which I do, but that's beside the point). Even if you support CAFE, you absolutely have to admit that it interferes with consumer choice. That's the basis of CAFE! To force manufacturers to force consumers to choose certain models of cars. That was my original point and it remains such. It is dishonest to support CAFE and claim it doesn't interfer with consumer choice.

quote:
If we aren't pushing these technologies, when it happens, we will be screwed. Not might be screwed, we will be screwed, all of us.


So you can see the future? I've always had difficulty with arguement. More so today than at times in the past. There exists significant technologies that are just barely economically worse than current oil technologies. Oil Sands, Biofuels, EVs, PHEVs, and gasp Public Transportation come to mind. Not sure why hobbling ourselves today to potentially avoid a crises of which we don't know the magnitude is the appropriate response.


RE: consumer choice
By retrospooty on 2/14/2012 6:01:31 PM , Rating: 2
meh


RE: consumer choice
By Schrag4 on 2/14/2012 5:57:43 PM , Rating: 2
If by "crash hard" you mean we see it coming more than just a couple of decades away, then I'd agree with you. And of course if we have several decades to transition, the "skyrocket" in price that takes several decades to unfold will provide ample time for the free market to get us onto electric cars or whatever tech happens to shake out by then (we'll probably all be dead from old age by the time this happens after all).

Just breath man.


RE: consumer choice
By Spuke on 2/14/2012 7:00:18 PM , Rating: 2
quote:
So why not develop and live at the same time simultaneously?
You tell Keeir to breathe and then proceed to paint a doomsday scenario. LOL! Free market will see this because prices will continue to rise (like they have been) to the point where other technologies and pricing structures become feasible. This has ben happening. Nothing new here. When I was a kid I would not have guessed that the AVERAGE price of a new car would be nearly $30,000 in my lifetime AND we'd all be ok with it. LOL! I expected prices to rise, but not like that. Example: in 1984 a brand new Porsche 911 Carrera cost $30,000. Now it costs $80,000. How many people were removed from the new car market because of those increases? How many more will be removed because of future increases?


RE: consumer choice
By retrospooty on 2/14/2012 7:13:17 PM , Rating: 2
Its not a doomsday scenario. Its called planning. We know it wont last forever and we need to build better efficiency into our cars, as well as alternatives to gas entirely.

If we do nothing but build V8 SUV's and Hummers until it happens, its too late. Its quite simple really.

Whatever though. I really don't give a crap. I am not in favor of CAFE specifically, but at least can see why to try and that is all my post meant. Of course the govt. screws up anything it touches.


RE: consumer choice
By Keeir on 2/14/2012 7:27:37 PM , Rating: 3
quote:
If we do nothing but build V8 SUV's and Hummers until it happens, its too late. Its quite simple really.


But we don't. V8's are now the least produced engine (I4, V6, V8)

http://www.autoobserver.com/2011/10/four-cylinder-...

Consumers are constantly reacting to higher prices. GASP! And we didn't have to have the government force the manufacturers to artificially raise prices further on those nasty V8s!

quote:
Its called planning.


Not really. You made a bunch of random statements in support of sweeping policy actions. I am pretty sure its called rabble rousing.

quote:
I am not in favor of CAFE specifically, but at least can see why to try and that is all my post meant.


That is called being in favor of something, to think that it should be "tried" over available alternatives.


RE: consumer choice
By retrospooty on 2/14/2012 9:25:32 PM , Rating: 2
You need to get laid really badly dont you?


RE: consumer choice
By Spuke on 2/15/2012 12:21:44 PM , Rating: 2
quote:
You need to get laid really badly dont you?
You really need a brain, don't you?


RE: consumer choice
By Keeir on 2/15/2012 1:31:39 PM , Rating: 2
quote:
by retrospooty on February 14, 2012 at 9:25 PM


quote:
You need to get laid really badly dont you?


HI-LAR-IOUS


RE: consumer choice
By Spuke on 2/14/2012 5:32:30 PM , Rating: 2
quote:
Errr.. you seem to have the same problem.
Yes and their problem is they're ok with forcing the population into more fuel efficient cars whether or not the population wants them. They state you can still buy a large vehicle but fail to see that the automakers MUST meet the CAFE requirements. These requirements do NOT make it easy (and maybe not even possible) for the automakers to build these larger vehicles. But what if people want larger vehicles and there are little to none available due to government regulations, what happens then (other than used car prices for these vehicles skyrocketing)?

I will guess that these people will insist that large vehicles will continue to be made despite CAFE regs, even though their presence reduces the automakers CAFE average. How do you do both?

My opinion, large vehicles will be made but will be extremely expensive and only the wealthy will be able to afford them. If the general population wants one they'll have to fight each other over the used one's, driving the prices up to where only the wealthy (again) can afford them. So, no regular person will own a large vehicle and depending on how stubborn we are, we won't buy a new smaller car either. Automakers lose money, GM gets another bailout. Wash, rinse, repeat.


"A politician stumbles over himself... Then they pick it out. They edit it. He runs the clip, and then he makes a funny face, and the whole audience has a Pavlovian response." -- Joe Scarborough on John Stewart over Jim Cramer














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