Better fuel economy; fewer sales?

By Ashley Payne, Staff Member
In a press release on Friday October 1, 2010, the U.S. Department of Transportation’s (DOT) National Highway Traffic Safety Administration (NHTSA) and the U.S. Environmental Protection Agency indicated they would begin developing tougher fuel economy standards for vehicles made between the years of 2017 and 2025. Olivia Alair, Move Should Save Consumers Money, Reduce Dependence on Oil (October 1, 2010), http://www.nhtsa.gov/Press-Releases (select "2010" from the drop-down menu labeled "Select Year"; then follow hyperlink dated October 01, 2010). This builds on the first phase of the program, which covers cars made from 2012-2016. Id. This comes as a response to President Barack Obama’s request that the NHTSA and EPA take “additional coordinated steps...to produce a new generation of clean vehicles.” Barack Obama, Presidential Memorandum Regarding Fuel Efficiency Standards (May 21, 2010), http://www.whitehouse.gov/the-press-office/presidential-memorandum-regarding-fuel-efficiency-standards.

The NHTSA and EPA determined that “a variety of automotive technologies are available, or are expected to be available, to support an increase in fuel economy and reduction in greenhouse gas emissions in the MYs 2017-2025 timeframe....” U.S. Dep’t of Transp., Notice of Intent FactSheet, http://www.nhtsa.gov/staticfiles/rulemaking/pdf/cafe/FactSheet_%20NOI_TAR.pdf (last visited Nov. 6, 2010). The proposed standards would increase the current standards from 34.1 mpg to between 47-62 mph in 2025. Id.

The increase in fuel economy does not come without costs. The initial assessment indicated that vehicle prices would rise an estimated $800 to $3,500 per vehicle. While this increase would be offset by an approximate savings of $5000 to over $7000 in fuel costs, the average American may not view these standards in such a positive light. Id. Because most Americans live in the now, the increase in up front costs may deter them from buying new cars even though they ultimately save more money in the long run.