Skip to comments.Obama's new fuel standards to add $2,000 to car prices
Posted on 11/17/2011 5:05:08 PM PST by 2ndDivisionVet
The Obama administrations new proposal to double the fuel efficiency of cars by 2025 may cost up to $157 billion and add $2,000 to the price of passenger automobiles, according to two federal agencies.
In the proposed rule posted on their websites, the National Highway Traffic Safety Administration and the Environmental Protection Agency predict the administrations new Corporate Average Fuel Economy (CAFE) standards would add an average of $2,000 to the price of each new passenger vehicle sold by 2025.
The NHTSA attributes the increased consumer costs to the price of developing new fuel-saving technology. However, the highway agency predicts the costs of the new standards would be offset by benefits of $419 billion to $515 billion.
President Obama said the rule, negotiated by the administration and a number of automakers in July, was a successful effort to reduce U.S. dependence on foreign oil.
The proposed rule would go into effect in 2017 and requires annual fuel-economy increases of five percent for cars. Ultimately, the rule would require automakers to reach an average of 55.4 miles per gallon for passenger cars by 2025. The current CAFE standard for 2011 is 30.2 mpg.
Light trucks like pickups and sport utility vehicles would only be required to raise fuel economy by 3.5 percent the first five years the rule would be in effect. After that, trucks would also be required to increase fuel economy by five percent a year.
Semi-trucks from model years 2014-2018 would have to achieve an approximate 20 percent reduction in fuel consumption and greenhouse gas emissions, saving up to four gallons of fuel for every 100 miles traveled.
The White House says the fuel standards will save 12 billion barrels of oil, reduce oil consumption by 2.2 million barrels a day about one-fourth of the oil the country imports and save consumers more than $8,000 a vehicle in fuel costs by 2025.
However, the rules have worried several automobile trade groups, including the National Automobile Dealers Association and Alliance of Automobile Manufacturers.
The proposed regulations present aggressive targets, and the administration must consider that technology break-throughs will be required and consumers will need to buy our most energy-efficient technologies in very large numbers to meet the goals, Mitch Bainwol, chief executive officer of the Alliance of Automobile Manufacturers, said in a statement to Bloomberg.
Republicans, too, have panned the proposed standards.
The House Oversight and Government Reform Committee has launched an investigation into how the standards were crafted. California Republican Rep. Darrell Issa, who chairs the oversight committee, has questioned whether the rules were rushed and could jeopardize safety by reducing the weight of cars.
Beyond jobs that would be lost as a result of this rule, there are concerns that these new regulations were crafted in a manner inconsistent with laws and basic standards of transparency that had the effect of hiding special interest agendas, Issa said in a statement Wednesday. The Oversight Committee will continue to conduct its investigation into the process that developed these standards and will continue to press the administration for answers on the impact this rule will have on jobs and vehicle safety.
In July, when the rules were first drafted, House Majority Leader Eric Cantors spokesman wrote on Cantors blog that such rules further tie the hands of job creators and add yet another hurdle to getting the economy up and running.
The result of these regulations means increased costs for businesses and families, and fewer jobs for workers, the spokesman wrote. Rather than placing additional burdens on working families and small businesses, Washington should be focused on removing barriers to growth and fostering an environment for job creation.
(VIDEO AT LINK)
In avowed socialist countries, the central planners are generally mathematicians and the like. Ours are lawyers.
It will also add hundreds of millions of dollars to the cost of healthcare to account for the dead and dying in the event of an accident.
That will teach us!
What I don't know...
Trust me. If there was a way to make a tractor trailer get 20% better mileage it would have been done now. You can make cars smaller and lighter but you can’t on a long haul truck....
Well I guess you can do it to a truck to but its going to cost a lot more than the cost of the truck. There will be more of them to handle the lighter loads. It’s counter productive so they will be all over it. However Mexican trucks and drivers will be exempt.
From the existing standard of about 30 mpg to 55 mpg. Over a 12000 miles per year (high estimate) that is a savings of about 180 gallons of fuel. At $4 per gallon that works out to an annual savings of $720. That makes the break even on $2,000 ... 2 years and 9 months.
If we use more normal numbers of 10,000 miles and $3.50 per gallon, then the savings is 150 gallons per year, $525 or 3 years 10 months break even.
And that’s under the big “if” where everything goes fine. Since government is involved, I’d say it will go from 30 to 35 mpg and will add $4,000 to the price.
“If we use more normal numbers of 10,000 miles and $3.50 per gallon, then the savings is 150 gallons per year, $525 or 3 years 10 months break even.”
If you ignore higher interest, sales tax, unknown depreciation, loss of trade in value and loss of freedom by being forced to buy a tin foil rickshaw.
There has never been a government mandate that didn’t carry unintended consequences far beyond the benefits.
Cash for clunkers anyone?
I buy used, I haven’t been able to afford a new car since a 1970 Chevy Malibu I bought.
A new car now averages about $20,000 dollars I can buy one hell of a lot of gas for $20,000 dollars,even at todays prices.
What can be done engineering-wise to significantly increase fuel economy? Several things would reduce the cost of cars: small diesel engines, small engines of any type, lighter, smaller cars with less creature comfort items.
Who remembers the Suzuki Samuri disaster here in America. They got a reputation for rolling over and ultimately were either rejected by buyers or made illegal. The rest of the story of the Samuri is that it was originally built for 3rd world countries and had a 26 horsepower engine. Then it was introduced to America with, among other thing a much larger, heavier engine which made it more tippy.
I’ll bet 26 horsepower engines would double our fuel economy. Why? Because our large engines spend most of their time at power levels way lower than their capacity and not near their point of greatest efficiency. Ever wonder why commercial trucks have such poor acceleration? Because their power trains are designed to run most of the time near their peak efficiency.
I’d buy a new car in a second, if A) I could afford one and B) I felt I’d be working long enough to pay it off.
Shouldn’t we save the $2000 and just make sure our tires are properly inflated?
The US produced over seven million vehicles in 2010 (hard to believe, I know), which means $14 billion slapped on the top — except of course the money spent won’t increase, the number of autos will decrease instead.
2004, bought a 2002 Silverado extended cab 4x4 dually with the 8.1l Vortec engine and the Allison transmission, fully loaded and I paid $31,000 for it, had low low miles.
I actually met the previous owner and he loved it but it did have terrible gas mileage. Ever since I have never gone past 2000 miles on an oil change, 1500 in the winter, I use Rotella T 5-40 full synthetic, in the winter I mix a quart of Amsoil 5-20 and a shot of Marvel Mystery lube, for the Alaska winter cold temps.
I am on the third windshield, third set of tires, replaced all the headlights, fog lights and even a pair of Hella passing lights with HID units, every other light except for some sealed units are now LED, has cadillac outside auto tint mirrors and instrument cluster, and a lot of other little extras from the sound system to stainless hood protectors.
Best truck I have ever owned. Its still a gas hog but I just don’t jump on the throttle much, it actually hardly ever gets past 2500 rpm what with 496 cubic inches and 360 hp. Body won’t rust, first GM truck I have ever owned that will not rust. Its a keeper.
I much prefer my 79 5.7 chevy pickup and my 99 7.3 chevy diesel van, especially since I don’t have to do emmisions. My 2003 4.3 chevy work van, not so much. No power & emmisions sock. Thankfully Texas has lower gas/deisel prices but things in the country are far away.
Please freepmail me if you wish to be added or dropped from the mitten ping.
CAFE standards (which, apparently, are set with zero input from automotive engineers) are going to continue to price cars out of reach for the average American family, but what difference does it really make to automakers? We'll just keep bailing them out.
How the hell do they come up with these numbers?
500 for a 94 last year. Hell, I see no problem with better mpg. Car prices go up and up, regardless of mpg regs. They always go up, even before the term mpg raised its ugly head.
What? How can that be? It isn’t magic?
“The US produced over seven million vehicles in 2010 (hard to believe, I know), which means $14 billion slapped on the top..”
You should really add the cost to the units sold, not units built, in the US. Our market is typically 12-14M units annually, however I think last year dipped to 10M or 11M units....
“Car prices go up and up, regardless of mpg regs”
If it isn’t CAFE, then it is safety, or materials, etc. You’d be shocked at the cost of government in every vehicle on the market.
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