Daily Podcast: CAFE Culture

Edward Niedermeyer
by Edward Niedermeyer

The list of CAFE violators ( in PDF form) reads like a valet’s to-do list: Mercedes, Porsche, Ferrari, Maserati. These firms pay CAFE fines because, well, they can. CAFE fines are calculated by multiplying each tenth of a mile per gallon of average non-compliance by $5.50, then multiplying that dollar amount by the number of vehicles sold. As a result, luxury firms pay the highest fines when they try to go mass market: Merecedes paid about $30 million for 2007. But if CAFE is already weighted to let small companies off the hook, why are we hearing about new rules which seem to relax standards for firms selling fewer than 400k vehicles per term? Aren’t the regular loopholes enough?

The answer takes a little digging to find, but it explains everything. Proposed rules for the 2011-2015 standard ( PDF) reveal that

EPCA authorizes increasing the civil penalty up to $10.00, exclusive of inflationary adjustments, if NHTSA decides that the increase in the penalty—

(i) will result in, or substantially further, substantial energy


conservation for automobiles in model years in which the increased


penalty may be imposed; and


(ii) will not have a substantial deleterious impact on the economy of the


United States, a State, or a region of a State.

Doubling the CAFE fine would force the small firms to finally get serious about efficiency . . . unless there were a loophole. Hence the loophole.

Of course, that’s not going to be enough come the day when greenhouse gasses become a regulated pollutant under the Clean Air Act. As proposed rules for CAFE/GHG coordination explain:

failure to meet the standards after credit opportunities are exhausted would ultimately result in the potential for penalties under [Energy Policy and Conservation Act] (CAFE), and under the [Clean Air Act] as well. The CAA allows considerable discretion in assessment of penalties. Penalties under the CAA are typically determined on a vehicle-specific basis by determining the number of a manufacturer’s highest emitting vehicles that caused the fleet average standard violation. This is the same mechanism used for EPA’s National LEV and Tier 2 corporate average standards, and to date there have been no instances of noncompliance.

In short, fines are going to double, and the risk of a Clean Air Act violation lawsuit means non-compliant firms face double jeopardy.

Edward Niedermeyer
Edward Niedermeyer

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  • Dean Dean on Jul 28, 2009

    Like we've said before, this an exceptionally complex way of getting the same thing you can get out of a simple gas tax.

    • Golden2husky Golden2husky on Nov 11, 2009

      Except that with a gas tax, you pay a penalty regardless of mileage of your car and do so every time you fill your tank. Other methods (CAFE, mileage based registration surcharges) only penalize those who choose to purchase a lower efficiency vehicle...a proposition that I find more fair.

  • 50merc 50merc on Jul 28, 2009

    Correct, dean, and under this law the bureaucracy has the "discretion" to be judge, jury and executioner.

  • Probert A few mega packs would probably have served as decent backup.
  • Lou_BC Lead sleds. Now-a-days GM would just use Bondo.
  • Jrhurren This is a great series. Thanks Corey
  • Tane94 Not as stylish as the Soul which it is replacing but a practical shape and bonus points for EV only.
  • Ronin What is the magical white swan event in the foreseeable future that will suddenly reverse the trend?Success tends to follow success, and likewise failure. The perception, other than among true believers, is that e-cars are a lost cause. Neither government fiat, nor government bribery, nor even the promise of superior virtue among one's peers have been enough to push past the early adapter curve. Either the bust-out is right now for e-cars, or it doesn't happen. Marketing 101.Even subtle language-manipulation, such as deeming those possessing common sense as suffering from some sort of vague anxiety (eg, "range anxiety") has not been enough to induce people to care.Twenty years from now funny AI-generated comedians will make fun of the '20s, and their obsession with theose silly half-forgotten EVs. They will point out that, yes, EVs actually ran on electricity generated by such organic fuels as coal and natural gas after all, and then they will perform synthesized laughter at us.
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