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President also calls for increases on federal spending for CNG vehicles, vehicle research, and EV tax credits

At a speech at Georgetown University in the nation's capitol, President Barack Obama's (D) message to automakers was simple -- "told you so."

I. Obama Crows Over Fuel Economy Victories

He remarked:

The fuel standards that we put in place just a few years ago didn’t cripple automakers.  The American auto industry retooled, and today, our automakers are selling the best cars in the world at a faster rate than they have in five years — with more hybrid, more plug-in, more fuel-efficient cars.

The old rules may say we can’t protect our environment and promote economic growth at the same time, but in America, we’ve always used new technologies — we’ve used science; we’ve used research and development and discovery to make the old rules obsolete.

The Obama administration is celebrating a win in which it convinced automakers to adhere to signficant increases to the CAFE (Corporate Average Fuel Economy) standard.  

Under President George W. Bush (R) and the 2007 Congress, the CAFE standard -- which covers light trucks and sedans -- was scheduled to hit 35 mpg by 2020.  President Obama first succeeded in bumping that target to 34.1 mpg by 2016 after initially asking for 35.5 mpg by 2016.

Following that success, the President's team pushed for a much higher standard for 2025 -- as high as 62 mpg.  Automakers said that increase would "kill" the auto industry, but eventually begrudgingly caved to a target of 54.5 mpg by 2025.

The result is a mixed bag -- customers will save thousands of dollars at the pump over the lifetime of their vehicles (the exact amount is dependent on the price of fuel), but will pay $2,059 USD more for a new truck and $1,726 USD more for a new car on average (critics contend the true price increase will be at least twice that).  And automakers have to swallow an estimated $200B USD in costs for developing advanced fuel efficiency technologies.

In his speech, the President also plugged General Motors Comp. (GM) -- a bailout recipient -- for making a climate change pledge. The President remarked, "More than 500 businesses, including giants like GM and Nike, issued a Climate Declaration, calling action on climate change 'one of the great economic opportunities of the 21st century.'"

GM makes the Chevy Volt plug-in electric vehicle that both President Obama and former President George HW Bush are big fans of.

II. More Regulation Ahead?

Emboldened by the concessions that he has already won from the industry, the President proposed more regulation in his speech -- including a fresh round of CAFE targets for heavy duty trucks.  The heavy-duty truck segment (which includes semis, garbage trucks, buses and three-quarter-ton pickups) was first regulated under President Bush's Energy Act of 2007, which calls for a 20 percent increase in average fuel economy by 2018.

The standard refresh would go into effect by 2018, and force that vehicle segment -- which typically features inherently poor fuel economy -- to continue more yearly bumps in efficiency.  Despite the gains since 2007, heavy-duty vehicles are still the second largest source of emissions in the transportation sector, according to the White House.

Super Duty rear
President Obama was new fuel economy targets for heavy duty trucks.
[Image Source: Jason Mick/DailyTech]

Other automotive highlights of the speech included a reiteration of the President's call to bump the electric vehicle tax credit to $10,000 USD, a demand for more federal advanced vehicle research funding, and a push to give new tax credits compressed natural gas (CNG) vehicles.

The President also called for regulations to limit the amount of carbon power plants can emit -- regulations that could force coal and oil burning plants to purchase expensive carbon capture and storage systems.

The speech compared these changes to the introduction of the federally forced introduction of the catalytic converter in 1970 (via the 1970 expansion of the Clean Air Act to cover automobiles), which critics complained would damage the industry.  He remarked:

At the time when we passed the Clean Air Act to try to get rid of some of this smog, some of the same doomsayers were saying new pollution standards will decimate the auto industry. Guess what — it didn’t happen. Our air got cleaner.

The President threatened the oil industry that he wouldn't approve the Keystone oil pipeline unless it cooperated with emissions improvements, remarking that the pipeline would be approved "only if this project does not significantly exacerbate the problem of carbon pollution."

Coal power station
The President wants stricter emissions standards for power plants. [Image Source: Reuters]
At least some of the President's demands are unlikely to be fulfilled given the Republican control of the House.  Thus far Republicans in Congress have fought efforts to bump tax credits for EVs/plug-ins and efforts to increase vehicle research funding.

Source: White House on YouTube

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RE: He is right....
By Schrag4 on 6/27/2013 9:49:16 AM , Rating: 1
It's not the engine necessarily, it's the poor aero of large trucks that keeps mpg down. You can hypermile a Ford 1 ton diesel to 30 mpg but only with low speeds and no stops. Getting that kind of economy with normal driving (you know where you obey traffic laws), will take a significant, expensive change in design.

And would this change in design have any significant impact on this?

You can't make a pickup truck that gets 25 mpg in the city and 35 mpg on the highway. At least if you want it to be able to do any work.

The point FIT was making is that nobody that pushes their trucks to the extreme will want any change in design if it means the extremes they can push them to will suffer as a result. For people that actually need a truck, such a redesign would be seen as a step backward, not forward.

RE: He is right....
By Spuke on 6/27/2013 5:06:45 PM , Rating: 2
This is all my opinion of course but I think it's a matter of money and what we are willing to buy (like always). You could make a truck get 25/35 and be just as capable but now you're talking a $120,000 (probably much more). No way is anyone buying that.

The point FIT was making is that nobody that pushes their trucks to the extreme will want any change in design if it means the extremes they can push them to will suffer as a result. For people that actually need a truck, such a redesign would be seen as a step backward, not forward.
No arguments from me here. In order to keep this affordable, a reduction in capability would have to happen and that's NOT going to happen. They might be able to get mid 20's ish mpg hwy with some aero improvements but as long as they have to use DEF the engine is not going to get them there by itself. At least not without significant expense.

RE: He is right....
By JediJeb on 6/27/2013 5:49:31 PM , Rating: 2
It is going to have to be one or the other, emissions or fuel economy. Sure we got better emissions when the catalytic converter was introduced but fuel economy also took a hit on vehicles of the same size. When more mileage was needed the move was made to smaller vehicles until the technology could improve for larger ones, but there still were limits.

The original Dodge with the Cummins Diesels would get 27mpg highway when properly tuned and geared about two decades ago, but they would certainly not pass emissions standards of today when setup like that.

RE: He is right....
By JediJeb on 6/27/2013 5:08:21 PM , Rating: 4
Since they are trying to kill the coal industry this example may not be so accurate, but around here the coal trucks haul 135,000 pounds of coal at a time down the highway(that is their permitted limits here in Kentucky). If you make a truck that gets twice the fuel mileage but can only haul half as much weight, then you have to run twice as many trucks which gains you absolutely nothing as far as emissions go. Yet it will look good on the propaganda when you tell everyone the trucks now get twice the fuel economy.

I guess next they will be wanting bulldozers to be half the size so they can get twice the economy. Wait until they mandate it for farm tractors and cause the price of food to go up. Oh wait, they will just expect farmers to absorb the costs like always so they can have their fuel economy win and keep food cheap.

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