After 20+ Years, Feds Raise the Bar on MPG for Cars

If you have your eye on a 50 MPG gen-3 Prius hybrid or a 150 MPG plug-in Volt, the new CAFE standards won’t seem like much. But the Department of Transportation’s plan to require automakers’ car and truck lineups to have an average fuel efficiency of 27.3 MPG by 2011 — an increase of 2 MPG over the 2010 standard — is a significant step: This is the first increase for passenger vehicle fuel efficiency since before A Flock of Seagulls was anything but a bunch of birds.

According to Obama administration officials who spoke with the Detroit News and Associated Press late yesterday ahead of this morning’s official announcement, the new standards will require automakers’ 2011 passenger cars (rolling into showrooms in late 2010) to get an average of 30.2 MPG. Light truck fleets (including SUVs, pickups and minivans) will need an average of 24.1 MPG.

The move signals that the Obama administration intends to raise the bar on automakers, although not quite as quickly as some environmentalists had hoped and the Bush administration proposed, but delayed, implementing (27.8 MPG average for 2011). The Department of Transportation said in its announcement this morning that a multiyear fuel economy plan for post-2011 models is “already well under way.”

Auto companies — two of which have received $17.4 billion in federal loans and requested an additional $21.6 billion — have protested that the new standards will cost the industry $1.5 billion. Tighter standards are on the way: An energy law passed in 2007 mandates a minimum 35 MPG fleet average by 2020.

The 2011 efficiency uptick could save millions of gallons of fuel (up to 887 million gallons of fuel, according to the Department of Transportation). That is, if we don’t base our driving habits strictly on our budgets, as David Owen argues in this week’s New Yorker that we’re prone to do: We spend about the same amount on gas each month, but drive more if gas is cheaper or we get more miles to the gallon. As Owen explains:

If doubling the cost of gas gives drivers an environmentally valuable incentive to drive less—the recent oil-price spike pushed down consumption and vehicle miles traveled, stimulated investment in renewable energy, increased public transit ridership, and killed the Hummer—then doubling the efficiency of cars makes that incentive disappear.

Even if the gains don’t disappear entirely (let’s face it: not everyone watches their fuel spending with such precision), the call for a gas tax hike to help bolster gas-sipping vehicle sales has garnered some unlikely supporters — Ford CEO Alan Mulally and AutoNation CEO Michael Jackson, for example. “I have fuel-efficient vehicles parked at my dealerships as far as the eye can see,” Jackson told the Wall Street Journal earlier this month after Mulally called for higher gas prices. “I can’t give them away.” Mulally said he wants the government to “involve the consumer in our energy policy,” giving them a stronger financial incentive (think: $4 a gallon gasoline) to opt for smaller and more fuel-efficient cars.


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