Find Reviews by Make:
To celebrate Earth Day, Transportation Secretary Mary Peters unveiled new CAFE standards: 35.7 mpg (cars) and 28.6 mpg (trucks) and 31.8 mpg (combined) by 2015. The Detroit News (DtN) condemns the announcement for "moving the goal post." Fair enough; Congress has already mandated a CAFE standard of 35mpg by 2020. The DtN reckons compliance with the new, new standards will cost automakers $47b over the next seven years. Why bother? The ed board reckons consumers are already voting for more efficient cars with their pocketbooks, pointing to a 12 percent drop in light truck sales in the first quarter of '08. Either way, the industry is the victim. "The federal government… continues to draw a bead on the auto industry and is doing nothing to ensure that there will be a market for the smaller, lighter vehicles its fuel mandates will require if gasoline prices decline from their current levels." In defense of the paper's stance, a gas tax would accomplish all of the government's goals with less intrusion and regulation. But congress and consumers ("Where's MY fuel tax holiday?") simply don't have the backbone to turn and face the strange.
16 Comments on “Industry Doesn’t Heart New CAFE Standards...”
Read all comments
The big 3 will have to make smaller and more fuel efficient vehicles – something they should have been doing in the first place.
Toyota may just have to stop producing large trucks and SUVs and stick with what got them to the top.
It’s not rocket science folks – I don’t really agree with the CAFE requirements, but rising gas prices are here to stay with or without CAFE.
If I could chose between giving up my hard earned cash to an inefficient bureaucracy like the government, and giving up my hard earned cash to an inefficient burearucracy like GM, I think I’ll give my money to GM. At the very least, I’m assured of getting a car with my money.
“A gas tax would accomplish all of the governments goals with less intrusion and regulation, but congress just doesn’t have the backbone to bite off such a risky mouthful.”
I fear what the gov would do with the tax money (more big government waste? socialize medicine? welfare? auto industry prop-up?) Is there ANY THING government does better than the private sector, other than waste money? I don’t want to feed that monster. How about we let consumers keep the dollars in their pocket and let THEM decide what to buy.. SUV/truck/sports car and lots of gas or mini car and a little gas? Maybe we could afford both. And, yes, no politician in their right mind (maybe some libs in their normal state of mind) will increase the price of anything in the face of the market price of it continuing to rise. How about we get them to take some action to increase domestic production, build some nuke electrical plants, sponsor more research on alternative energy?
Amen for that fuel tax. The way it is now, we already pay one, to oil refiners and worse, producers, including Russia, Iran, Venezuela, Saudi Arabia,…
Despite its inefficiency, I’d rather pay more to my government. But Congress did not have the guts to go down that way, and chose to blame everything on the car manufacturers instead (that’s what CAFE does).
Sorry, gonna have to agree with the Detroit News.
Same thing as current CAFE standards. Say (just pretend) gas goes back to maybe $1.50-$2.00/gallon. People are going to flock to big cars with big engines, because they can afford it.
Meanwhile the high MPG cars that do exist to balance out the lower MPG ones will never get sold. All that money sunk to meet a government requirement that in the end doesn’t come close to doing what it is supposed to.
So what is the end goal – I assume it is to reduce oil consumption and emissions.
Seems that mandating the Big 3 to start making Priuses is like asking Little Debbie to sell lettuce cakes to fight obesity.
While I am no supporter of the Big 3, I can sell a politician.
Adding consumption and emissions taxes are just the beginning – you also have to provide alternatives. Oh I don’t know something wacky like public transportation.
A gas tax doesn’t have to take additional money from the population as a whole. A popular proposal is to reduce various payroll taxes to balance the increased fuel taxes. If you pay more at the pump but lose less of your paycheck, you’ll actually come out ahead if you are lower than average in your fuel consumption. How cool is that?
Additionally, CAFE doesn’t address several fundamental issues needed for reduced fuel use effectively. CAFE doesn’t cause people to drive less or drive a car instead of a truck when only a car is needed or to keep their vehicle in top working condition. A gas tax works on vehicle efficiency, vehicle miles traveled, vehicle type choice, and vehicle maintenance all at the same time. Therefore, it will allow consumers to figure out how to spread the pain to make the situation as comfortable as possible (and, in fact, 1/2 the nation could see a net reduction in total taxes paid because of reduced income tax).
The biggest problem I see with an “instant” gas tax is that the commercial infrastructure is not ready for it. Introducing a gas tax to a truck-based transport infrastructure would require some serious tax breaks and rebates for the trucking and delivery industries. With all this recession crap looming, timing couldn’t be worse.
On the other hand, a well-balanced gas tax + income tax cut that would gradually account for the eventual drop in consumption would get the job done easily and relatively painlessly. Far better than those stupid ethanol subsidies or CAFE. Only trouble is, nobody up there has the nuts to get it done.
@ AKM
You do know that Canada is the number one importer of oil to the US.
Guess what number two is?
Mexico.
You’re just giving money to your friendly neighbours to the north and south.
http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/company_level_imports/current/import.html
A popular proposal is to reduce various payroll taxes to balance the increased fuel taxes. If you pay more at the pump but lose less of your paycheck, you’ll actually come out ahead if you are lower than average in your fuel consumption. How cool is that?
The real question is: How likely is that?
Devilstower over at dailykos has an observation on the issue, an excerpt:
And that’s the very good news. Because consumption of oil is, at its heart, a social issue. There’s no Second Law of Petrodynamics that states every human being must have 20 gallons of high test to get through the day. Sure, it will be great to have plug-in hybrids and full bore EVs on the road, but we don’t have to wait until then to tackle this problem. We can choose to end the oil crisis, and it involves no technological breakthroughs at all.
The solution lies in making choices as boring as picking up that fluorescent light bulb. The answer is conservation.
* Drive less.
* Take public transit.
* Walk.
* If it’s too far to walk, use a bike.
* If it’s too far to bike, and there no public transportation, car pool.
* If you can’t car pool, use a smaller, more efficient vehicle.
* If you have a long commute, move closer to work.
* If you can’t move closer, take a closer job.
* If you can’t get a different job, see if you can telecommute.
It really is that simple. Which of course, doesn’t mean it will be easy. We’re accustomed to jumping in our personal battleships and cruising the highway at speeds just less than supersonic every time we get a craving for a Slurpee. Making significant changes to oil consumption requires a sacrifice of one of the things Americans value most: convenience, and no one — not government, not industry — can really do as much as you can by simply parking it.
http://www.dailykos.com/storyonly/2008/4/23/131629/850/691/500684
There’s no doubt CAFE is going to damage the industry for our home automakers (accelerating their demise) and cost foreign automakers billions of dollars.
I do not doubt much of this cost will be passed on to us consumers in the form of higher vehicle prices, vehicles with lots of compromises, and fewer choices of vehicles on the new car market.
And all for what exactly? What does CAFE accomplish that the free market and fuel prices and consumer choice wasn’t already trending towards?
I think if our government was that concerned about how much fuel the nation uses they would have done something more procative and much less punitive like mandating no sales tax be assessed on new vehicle purchases if it averages over 20 or 25mpg. Or invest more in mass transit for our nations big cities, similar to what the rest of the world already uses and enjoys. Or mandate work from home programs for many businesses.
It seems to me measures like that would not only encourage wiser vehicle purchases, but also lessen overall fuel waste and emissions during rush hour.
The federal fuel tax is laughably low at 18.4 cents per gallon. Say you use 15 gallons/week, which would be about 65 gallons/month. That amounts to about $12 a month. I’m not going to drive any more or less with that. So yes, I don’t mind a higher fuel tax as long as it’s properly used.
Stein brings up a good point, to a certain extent it is a social issue, which is extremely controversial to legislate. Why should we let the government tell us what’s best for us?
The simpler the law is, the better it is for everybody to understand, and the easier it is to analyze the effects. CAFE standards can be needlessly complex and just end up involving lawyers when things go wrong.
Why do people have this obsession with being taxed? Do you not want to hold on to your money?
Why the separate standards for cars and trucks?
Keeping it all in one pot would be so much simpler…
Also better for the industry if the shift to cars continues…
I don’t think this is government bussines no matter if it’s CAFE or gas tax. Let the market regulate itself. Let the gas get to $7-8 or $10 a gallon (europe anyone?) and that will get rid of all the trucks/SUVs/gas guzlers in US. The car manufacturer will adapt to it by selling smaller more efficient cars (europe anyone?). Pople will adapt to it by walking more, using the bus and bycicling. Problem solved. All we need is just sit back, relax, enjoy the good times while they last and wait for the free market to regulate itself. That’s the way capitalism is suppose to work. Am I wrong?