Positive Post of the Day: New EPA Standards Save You $3,000 Edition
Published: September 15th, 2009
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Just don’t ask what the newly-released rules will do to the upfront cost of your new car. Though the EPA claims that 35.5 mpg by 2016 is “within reach” of the industry, OEMs will certainly pass some of the $2 billion in costs to meet the standard onto consumers. Let’s also not forget the billions of taxpayer money spent on retooling loans intended as a payoff to the industry for agreeing to the standard, or the EPA’s estimate that new regulations will save consumers $3,000 in fuel cost is over the vehicle’s lifetime. Good thing the new rules will save the environment and improve energy independence. Otherwise we’d have a really hard time being positive about all this.
More by Edward Niedermeyer
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@Chuck, You are 100% correct. The emissions standard and OBD-II standard is what is keeping diesels away from the USA. Mercedes (and most likely VW however I have not checked) are able to sell their diesels in the USA b/c they pay fines to CARB, something the mainstream OEMs will not do. This BS idea that higher CAFE standards is going to save us from global warming or that it is going to save the public money is nonsense. Personally, I would be in favor for state-by-state fuel economy standards, in the form of fuel taxes. If the leftists in California want to impose high fuel economy, then they can tax their people. It is the only thing that works and it is unfair and un-American to force private manufacturers to build cars according to some looney-tunes morons on the coastlines. Half of the damn reason why GM/Chrysler/almost-Ford were in the position they were put in was b/c they had to build a bunch of higher mileage vehicles and sell them at losses to satisfy some arbitrary fuel economy standards. Go figure why these vehicles were de-contented and cheaply made.
I'll let some poor bastard buy new and I'll buy it used after depreciation sets in. This way someone else pays for political grandstanding.
"OEMs will certainly pass some of the $2b in costs to meet the standard onto consumers. " I think you can assume that ALL of that cost will be passed on. The average return on capital, worldwide, for the auto industry was 3% three years ago, when the general economy was booming.