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Mercedes failed to meet US-market CAFE standards in 2008 and paid a $28.9m fine in December for it, reports the Freep. VW also paid the NHTSA a fine of $4.5m in August for light truck violations, while Porsche paid $1.2m and Ferrari coughed up a $1.1m to flout CAFE through 2008. But the Mercedes fine, which came to light in a recently-released NHTSA document, is the second largest in CAFE history. DaimlerChrysler AG remains the king of CAFE failure, having paid a record $30.3m in eco-indulgences for its 2006 imported product line. Which consisted primarily of of Mercedes models. Is it any wonder then that, as Bertel noted just a few days ago, Daimler is catching the hybrid fever?
I say, Congrats to them. These aren’t fines, merely a tax on people’s choices in cars
GF
Mercedes’ full-year sales in 2008 were 249,750 cars. Assuming I did my math right*, rounding up that’s a fine of $116 per car. At these prices, why bother fixing the problem? No hybrid system is that cheap. This is a slap on the wrist – if Congress is serious for whatever reason about doing something, they’ll need to increase the fine by at least an order of magnitude.
I do find it funny that they manage to get fined despite getting E85 credit for the C300. Maybe they need to put that engine in a few more products to get enough Iowa credit. Or maybe Congress needs to readjust the credit based on how often the cars actually are filled up with E85. There isn’t enough of it at the pump to fuel all the cars that have been CAFE credited for it…
* I was a math major, so don’t get your hopes up.
Someone educate me. How are these fines different from gas guzzler taxes?
The ‘fines” are collected by M-B as gas guzzler taxes on your S600 purchase. Or SL65 toy. It is calculated over the fleet and M-B, prorates it per car depending on how far below the CAFE standard that model is.
GF
Me? Good. It shows another reason why CAFE is ridiculous. The companies that violate it just write it off as a cost of doing business. Another loophole, and one I’m glad to see companies sticking to the gov. If you got the scratch for a Benz, you don’t mind paying a wee bit extra for boatloads of power. So they just roll it into the cost of doing business. And CAFE just proves ineffective at its intended purpose. However, looking at it from a revenue side, maybe its a winner. When red light cameras no longer are good for increasing revenue(I mean improving safety), watch localities implement their own fuel economy standards(to save the earth!) then people who go over them. Hey, it could happen. Wasn’t one of the (another ridiculous) stipulations on the bailout bucks that they couldn’t sue states trying to set their own emission/fuel economy standards? What’s to stop California from saying everyone needs to get 50mpg and when you don’t they either fine the company or fine you? Its already supposed to happen here in IL with Gov Bad Hair’s plan to install HOV lanes on the tollways to save the earth….but allow people to pay extra to travel in the green lanes alone if they feel like it. Blatent money grab there as well. I tell ya, I’m starting to get sick of all the ways the gov schemes to get your money. It isn’t just covering the basics of goverment, it is a way to keep making it bigger and bigger and taking more and more of what belongs to you.
Do I have it right that GM and Ford actually meet CAFE standards each year? Yeah I know their averages are low, but you always hear attacks on these two for their crummiest averages. I’d like to know if they also pay fines or if these companies are even worse. And if so, why isn’t anyone out there tearing M-B or BMW a new one??
Exactly, CAFE is no more than a tax.
The Germans continued to make their traditional large sedans and high performance cars and pay the tax.
The Japanese continued to make small, efficient cars and avoid the tax.
The Detroit automakers cut off their noses to spite their faces and gutted their lineups in protest. Despite the fact that their lobbyists had huge influence on CAFE and engineered it to help the Detriot automakers sell more of their lucrative trucks.
Unfortunately in a competitive market Detroit’s pouting over CAFE did not work.
Jerome10:
The Detroit automakers could pay the tax just like anyone else. One thing that is unfair to them is that foreign and domestic fleets are calculated separately in CAFE, so GM cannot balance its large NAFTA made cars with foreign cars like the Korean Aveo.
Sound like it is time to both put more penalty teeth into CAFE.
Or just scrap the whole thing and replace it with a tax based on vehicle weight and/or engine displacement.
@RedStapler- or just a gas tax?
The only real solution is to enforce minimum mileage requirements for all vehicles. It is obvious CAFE is a joke. Taxesfines are not the solution.
Government totally sucks and is industry/corporation’s beyotch. Real enforcement, not a wrist slap of a fine.
It’s like Prop 2 in California to improve animal farm conditions by making farms increase moving space and stuff like that. The fines are like 1k-2k if the companies don’t comply and improve conditions. Doesn’t deter the farms because while the penalty is 1k-2k, the profit gained from not improving conditions are much, much higher.
Same with CAFE. Fined a few million. Who cares when the amount you gain by not following the rules is greater than the penalty/following the rules.
CAFE’s just a front to make it seem like the government’s doing something. :/
Why should we penalize owners for their choice in cars? CAFE serves its purpose, however toothless it might be. Here in Quebec people get shafted with an annual gas guzzler tax on new AND used cars, not including the gas guzzler fee on the purchase of a new vehicle – all 4.0L + vehicles made after 1995 are subject to a sliding scale of extra taxes added to the annual registration cost.
Mercedes is evil! They should BE ALLOWED TO DIE because they keep forcing gas-guzzlers on the AMERICAN PUBLIC!! They have a union in Germany that is even more militant than the UAW! They are WASTEFUL DINOSAURS!! They’re building the kind of gas guzzlers that Americans…. er, say what? Really? How many? Willingly?
Oh.
Nevermind…
Hint hint…Not only does Mercedes fail CAFE but so does BMW, Porsche, Lexus, Infiniti, Ferrari, Maserati, Aston Martin…and some others I can’t think of right now…
How dare those evil car companies in Detroit make such inefficient gas-guzzling SUVs and such !!! Oh wait a minute…they’re not made in Detroit?
Hey, hey, hey! This is about Detroit. Stop bringing up these other manufacturers!
So what?
The beautiful ’72 to ’89 series SL had a $2k+ (1986 dollars) gas guzzler tax applied to it, yet unlike the domestics, they are probably still going to be in business in 2010.
Damn it. You guys (fellow posters) beat me to snarky comments about the double standard applied to Detroit cars over foreign models. Kudos.
Good!
Ferrari could probably save money by giving each purchaser a Fiat 500.
Corporations don’t pay fines or income taxes.
Consumers do.
Chevelle,
Or, the owners/stockholders do if they can’t pass the cost along. So, MB passed along the cost of CAFE, but GM, Ford, and Chrysler owners paid. Unintentionally, CAFE set up a system of redistribution where people buying inexpensive domestic cars were being subsidized by people buying higher end domestic cars. Given the price to create a money loser like most high mileage domestics, MB took the fine and likely made the correct decision. The domestics can’t change their plan due to labor laws and contracts, or they would likely do the same, and the price of a new, low end car, would rise to it’s proper level.
After the government figures out that it makes no sense to bleed the domestics while giving them plasma, what will they do next? Will they ever figure out TINSTAAFL? Once again, do the math. If you doubled the fuel tax, and poorer drivers bought less cheaply made low end cars, and instead bought safer, better made, used high end cars, they would be spending LESS money per mile, the treasury would be getting more money, and there would be more incentive for buyers who drive the most miles to buy more efficient cars and ACTUALLY increase the fleet mileage.
Or, continue what we are doing, it works so well.