Feds: Automakers may not meet fuel economy target

Keith Laing, Detroit News Washington Bureau
2:18 p.m. EDT July 18, 2016

Washington — Federal regulators say automakers may not reach a fleet-wide average of 54.5 miles per gallon by 2025, as specified in a 2012 fuel economy rule adopted by President Barack Obama’s administration.

Instead, they said automakers may only be able to achieve an average of between 50 and 52.6 miles per gallon by the deadline.

The U.S. Environmental Protection Agency, National Highway Traffic Safety Administration and the California Air Resources Board said in a draft of a technical report that will be used to determine the feasibility of the final four years of the fuel economy rule the increase will still be a big improvement over current U.S. mileage rates.

The potential decrease is attributed in part to gas prices that have been lower than anticipated when the mileage rules were crafted in 2012. Even though automakers may be able to build cars that meet the toughest fuel standards, customers have been buying SUVs and trucks — and it’s the overall average of vehicles sold that counts.

The proposal mileage rules for 2017 to 2021, which will require automakers to hit a combined average of 41 miles per gallon for their cars and trucks, are set in place. The rules for 2022 to 2025 will not be changed until a mid-term review is completed in 2018, despite the finding that automakers may miss the final fuel efficiency mark.

Janet McCabe, acting assistant administrator for EPA’s Office of Air and Radiation, said the report from the EPA and Department of Transportation “shows that automakers are developing far more technologies to improve fuel economy and reduce greenhouse gas emissions, at similar or lower costs, than we thought possible just a few years ago.

National Highway Traffic Safety Administrator Mark Rosekind agreed, saying “automakers have already implemented new technologies that are saving American drivers money and cut national fuel consumption and carbon emissions today.”

The draft report, which was released Monday, was highly anticipated by automakers and environmentalists who have been jockeyed over the proposed gas mileage rules, known as Corporate Average Fuel Economy (CAFE) standards, since they were established in 2012.

The new CAFE rules are beginning to take effect with the 2017 model year. They call for ramping up from the current fleet-wide average of about 34 miles per gallon for cars and trucks that were required in 2016 to the eventual goal of more than 50 miles per gallon by 2025.

The increase, which some automakers have said might be too ambitious, starts with a rise to an average of more than 35 miles per gallon for the 2017 models that already are being rolled out.

The mileage rules call for automakers to achieve a fleet-wide average mileage rate of more than 36 miles per gallon for cars and trucks in 2018.

The standard then increases to more than 37 miles per gallon in 2019 and nearly 39 miles per gallon in 2020, which is before automakers will have a chance to weigh in on the need for any course corrections. By 2021, automakers will be required to hit a combined average of 41 miles per gallon for their cars and trucks.

If the rules for model years after 2021 are left in place when they come up for review in 2018, the emission standard will increase to about 43 miles per gallon combined for cars and trucks in 2022, before jumping to about 45 miles per gallon in 2023. The final years of the mandate will see a required average of about 47 miles per gallon in 2024, and finally more than 55 miles per gallon for cars and about 40 miles per gallon for trucks in 2025.

The draft report that was released on Monday is part of a mid-term review of the mileage rules that was included in the emission plan that was enacted in 2012 at the request of automakers.

Environmentalists praised the federal agencies for not ditching the stringent emission rules for automakers altogether.

National Association of Clean Air Agencies Executive Director S. William Becker said the report from the EPA and DOT “underscores the strength of the auto industry and the substantial progress manufacturers are making to meet greenhouse gas and fuel efficiency standards.”

“The lead time that the 2012 rule provides for manufacturers to comply with the standards for model years 2022-2025 is a technological eternity in the auto industry,” Becker added. “Accordingly, there remains no doubt that the 2022-2025 standards are entirely feasible.”

Although major automakers agreed to the guidelines, they have raised concerns that the CAFE requirements may be overly optimistic, saying that the more fuel efficient vehicles may be difficult to sell to customers who prefer larger vehicles like SUVs and trucks.

The Washington, D.C.-based Alliance of Automobile Manufacturers, which represents Fiat Chrysler Automobiles, Ford Motor Co., General Motors Co., BMW Group, Jaguar Land Rover, Mazda, Mercedes-Benz USA, Mitsubishi Motors, Porsche, Toyota, Volkswagen Group of America and Volvo Car USA, said in a statement that was provided to The Detroit News “the fuel economy/greenhouse gas targets for 2025 now reflect how the fleet mix has changed, largely due to low gas prices.

“The government is acknowledging the effect of factors like low gas prices on consumer sales, and the impact of consumer sales on the targets,” the auto group said.

Consumer groups have sided with environmentalists, predicting that the gas mileage rules will be good for automakers and the U.S. economy.

Carol Lee Rawn, who directs the transportation program for the Boston-based sustainability nonprofit Ceres, said, “We can’t forget that U.S. automakers have been caught flat-footed before, when prices at the pump rose and they weren’t ready with the kind of fuel-efficient vehicles buyers wanted. Strong fuel economy standards offer insurance against future gas price spikes,” she added.

http://www.detroitnews.com/story/business/autos/2016/07/18/automakers-fuel-economy-standards-cafe/87256278/

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