62 MPG: The War Of The Letters
The war of words over a possible 62 MPG 2025 CAFE standard is accelerating this week, as letters in support of the standard [sub] are vying with industry responses against the proposal for media attention. And though environmentalists are quick to point out the often-misunderstood difference between EPA and CAFE mileage ratings (a fact that even the industry-friendly Automotive News [sub] concedes, if only in a blog post], the industry’s response is miles away from any kind of compromise, saying
The alliance believes it is inappropriate to be promoting any specific fuel economy/greenhouse gas at this point
How’s that for some old-school, don’t-tread-on-me corporate attitude? No room for compromise, no sense of nuance… and yet, that doesn’t actually represent the industry’s position at all.
Toyota, a member of the AAM, has already publicly stated that it has no problem with any future CAFE standards. VP Jim Colon explains:
The administration is engaged. That’s the direction Toyota is already going. Whatever goal they establish, Toyota will be prepared to meet. If it’s 62 miles a gallon, we’ll be able to achieve that.
And, if anything, Toyota’s compliant attitude is the product of pressure from Hyundai, which recently took the industry-leading step of publishing its sales-weighted fleet average fuel economy on a monthly basis. Hyundai USA CEO John Krafcik has been outspoken about his brand’s plan to “overcomply” with CAFE, pointing out that Hyundai’s Elantra will reach 50 MPG CAFE combined by its 2015 redesign, a good 10 years before the 62 MPG standard might take effect.
But despite the industry’s tough position and internal dissent, the AAM does bring up one strong argument in this war of words: that, whaerever it ends up, the standard
should not be arbitrary numbers, chosen before the necessary analyses are completed.
This accusation does stick to California’s Air Resource Board, which has insisted on a 62 MPG 2025 standard since long before feasibility studies were complete. At the same time, the accusation is fairly irrelevant at this point. The AAM has little credibility given the dissent in its ranks, as the industry is split on whether 62 MPG is reasonable and achievable, or a coming apocalypse. And as long as the anti-62 MPG faction fails to convince the rest of their industry to hold the line at (say) a 50 MPG standard, though, it’s probably doomed to fail.
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CAFE is a faulty supply side economics concept to force OEMs to sell cars / trucks to people who don't want them (demand). When gas is cheap - no one wants fuel efficient cars b/c it doesn't save them a lot of money. CAFE then has so many loopholes in it that you can sell an flex fuel SUV that gets 14mpg when running gasoline and 10mpg when running E85 - but CAFE rates that E85 car in the mid 20's. I doubt less than 5% of flex fuel owners put in E85 in their vehicles (b/c I don't want my car/truck to get 33% less miles per tank and pay almost the same for E85 - which in and of itself is highly subsidized to seem cheaper at the pump). When gasoline prices rise an amazing thing happens - logic. People now demand fuel efficient vehicles - no need for CAFE, no need for subsidies, no need for the multitude of imperfect measures. So when gas is cheap - people will want more than they need (big heavy gas guzzlers). So let's not let gas become cheap anymore (as much as that sounds bad) by levying an artificial gas tax to keep prices high. That will keep the momentum of buying fuel efficient cars - and it also helps our national security by decreasing our consumption of fossil fuels so we are no longer as reliant on unstable countries and it adds stability to our lives as no more fluctuating gas prices at the pump. We use less over oil time and the supply becomes more stable as we are at the limit of what all oil reserves can provide (only solution is drill everywhere we can to find some more - only passes off the hard lesson to later).
I can't believe people advocate raising taxes to force behavior. Taxes should cover costs, that's it. That goes for cars, cigarettes, drugs, hookers, etc. CAFE is a total joke. It has been acceptable for all these years because people have still been able to get the cars they want. Once it actually has an impact, and the only thing you can buy is the 2015 Elantra, then I think we'll see a totally different view on this stuff.