Several major automakers on Friday embraced the Obama administration’s proposal to push the industry further away from once-dominant gas guzzlers to more lean and efficient vehicles.
The proposal, which is the result of months of negotiations between the Obama administration and auto makers, would require the companies to reach an average fuel efficiency across their U.S. fleets of 54.5 miles per gallon by 2025.
“This agreement on fuel standards represents the single most important step we’ve ever taken as a nation to reduce our dependence on foreign oil,” Obama said at an event announcing the new standards.
Flanked by top auto maker executives, Obama said the new rules would lower the country’s oil use by 2.2 million barrels a day over the next 15 years.
The rules will cut more than 6 billion tons of carbon emissions for the duration of the program.
“Can we do it? Well, we put a man on the moon; of course we can do this,” said Fadel Gheit, senior analyst covering the oil and gas sector at Oppenheimer. “If the will is there, we will be successful and this is the best way to achieve this by pushing and cajoling.”
While fleets would be required to reach corporate average fuel economy, or CAFE, standards of 54.5 mpg, under real world driving conditions that can sap fuel economy, consumers will likely get fewer miles per gallon in many cases.
The goal is still a major step up from current standards that require auto makers to achieve 35.5 mpg by 2016.
“Many OPEC oil ministers are now having sleepless nights, because of the millions of barrels of oil … the U.S. will now not be importing,” Democratic Congressman Edward Markey told Reuters in a telephone interview. Markey was co-author of the law that mandated higher fuel economy standards.
Challenge for Trucks
The biggest auto sellers — General Motors, Ford Motor Co, Chrysler, which is run by Italy’s Fiat, Toyota Motor Corp and Honda — have all backed the administration’s plan.
The new program includes average increases in fuel economy of 5 percent for cars and 3.5 percent for light trucks through 2021, with a 5 percent increase for all vehicles after that.
“We have a challenge on trucks, but we think this is a fair way to handle it,” Sue Cischke, Ford vice president for sustainability and the environment, told reporters at the event.
Mercedes-Benz, the luxury car line owned by German car and truck maker Daimler, did not back the new program, saying it “clearly favors large SUVs and pickup trucks.”
To meet the new targets, auto makers will have to cut weight from their vehicles, develop smaller engines and boost fuel efficiency through direct injection, start-stop technology and turbochargers.
The Center for Automotive Research projected bringing cars and trucks to a 56 miles per gallon CAFE standard would cost about $6,700 per vehicle. The study has been criticized for overestimating the cost of technologies.
“I have to really question the sanity behind that,” Dennis Virag, president of Automotive Consulting Group Inc, said of the new CAFE standard. “It’s going to be a very difficult mark to achieve and I think it’s going to be very costly.”
The Obama administration declined to release any estimates on Friday about how the proposal will impact the retail costs of vehicles. It said it is still studying potential impacts and will release details later.
The Environmental Protection Agency and Department of Transportation, the agencies developing the new standards, will release the full details of the program by the end of September.
The agencies have pledged to undertake a comprehensive mid-term evaluation of the standards before finalizing the targets for cars and light duty trucks after 2021.
They are also considering implementing incentive programs to promote electric and plug-in hybrid vehicles, and plan to propose credits for efficiency improvements for air conditioners.
For more than 20 years, aluminum producers have been working with U.S. automakers to design more of the light weight metal into cars to lower emissions.
Following Obama’s announcement, Randall Scheps, chairman of the Aluminum Association’s Aluminum Transportation Group said in a statement, “Vehicles downweighted with aluminum are inherently more fuel efficient than heavier ones made from steel. Several leading vehicles use all-aluminum bodies, and we will see more vehicles go all aluminum in the next 10 years.”
(Additional reporting by Malathi Nayak, Emily Stephenson in Washington and Ben Klayman in Detroit and David Sheppard and Carole Vaporean in New York; Editing by Alden Bentley, Sofina Mirza-Reid and Lisa Shumaker)
About This Story
Perhaps you noticed: This story, like all the news we publish, is free to read. That’s because Inside Climate News is a 501c3 nonprofit organization. We do not charge a subscription fee, lock our news behind a paywall, or clutter our website with ads. We make our news on climate and the environment freely available to you and anyone who wants it.
That’s not all. We also share our news for free with scores of other media organizations around the country. Many of them can’t afford to do environmental journalism of their own. We’ve built bureaus from coast to coast to report local stories, collaborate with local newsrooms and co-publish articles so that this vital work is shared as widely as possible.
Two of us launched ICN in 2007. Six years later we earned a Pulitzer Prize for National Reporting, and now we run the oldest and largest dedicated climate newsroom in the nation. We tell the story in all its complexity. We hold polluters accountable. We expose environmental injustice. We debunk misinformation. We scrutinize solutions and inspire action.
Donations from readers like you fund every aspect of what we do. If you don’t already, will you support our ongoing work, our reporting on the biggest crisis facing our planet, and help us reach even more readers in more places?
Please take a moment to make a tax-deductible donation. Every one of them makes a difference.
Thank you,
