Gas War: Efficiency Rollback Would Raise Fuel Costs, Study Claims

Matt Posky
by Matt Posky
gas war efficiency rollback would raise fuel costs study claims

The fuel economy rollback posited by the Trump administration remains a hotly debated issue within the automotive community. Unfortunately, it has become mired in political nonsense, making decrypting the real-world impact of embracing or shunning it rather difficult. Consumer Reports recently took a stab at making sense of the matter, coming out in favor of balking at the notion of a rollback on the grounds that it would ultimately raise fueling costs.

Last year, the administration proposed capping fuel economy and emission standards at 2020 levels, instead of allowing them to rise annually as under existing regulations. The opposition, fronted by California, is vying to maintain the existing standards — with the possible compromise of delaying them by one year.

“The rollback is like a gas tax because it increases drivers’ fuel costs,” suggested Consumer Reports, comparing the proposed policy change to an additional 63 cents per gallon of gasoline for owners of 2026 model year vehicles. According to Bloomberg, CR believes the administration’s preferred policy choice would translate to an additional $3,300 on those cars. The study also claims owners of trucks and sport utility vehicles would be among the hardest hit — which seems like it should go without saying.

“The facts don’t back this rule’s Orwellian name,” said David Friedman, vice president of advocacy for Consumer Reports. “The evidence shows that lowering fuel economy and emissions standards won’t do anything to improve traffic safety, but it will leave Americans stuck with the bill.”

While Consumer Reports usually does pretty good work, some aspects of this study seem short sighted. Advanced technologies focused on maximizing fuel efficiency aren’t cheap. In many instances, the cost of owning a hybrid vehicle isn’t actually offset by fuel savings when you account for their higher MSRP and swifter depreciation. While that could change if fuel prices climb high enough, the more likely scenario is that overall savings will vary on a case-by-case basis and be heavily influenced by how you drive. Meanwhile, purely electric vehicles have a much lower operating cost but a significantly higher point of entry vs a similarly sized car utilizing internal combustion. This is currently offset by federal tax credits, but those won’t last forever and we don’t know for certain how quickly battery prices will come down.

If you are going to put a lot of miles on a vehicle in a short period of time and trade it in after a few years, a hybrid might make sense. However, if you like to wring out every drop of usefulness from your vehicles and don’t have a terribly long commute, the inverse could be true. Although, CR said that this was largely irrelevant since most car buyers finance their vehicles.

To prove we aren’t playing favorites, we’re also going to put down the White House’s assertion that the fuel rollback would save lives. Both the Transportation Department and Environmental Protection Agency have argued their proposal would reduce the cost of new automobiles and save as many as 1,000 lives annually by encouraging motorists to trade older models for newer, safer, less-costly vehicles. While the financial aspects may be true, the safety claim is highly circumstantial and influenced by a myriad of other factors. There was also talk, which has been walked backed in recent months, that future vehicles will need to be made lighter in order to meet stringent economy standards. This could result in more older, oversized vehicles going head-to-head with flimsy econoboxes… maybe. But there’s nothing to suggest consumers will shy actually away from larger vehicles in the first place — with the only exception being higher fuel prices.

Ironically, more-expensive gas has historically been the best predictor of what consumers will actually buy. Therefore, if the fuel economy rollback does boost the cost of fuel, it may accidentally result in people buying more efficient cars than they otherwise would have. Of course, Consumer Reports‘ increased fuel costs don’t occur at the pump. Instead, it’s the cumulative estimate resulting from owning a less-efficient automobile — something consumers could easily change by buying something else. That said, gas prices will probably go up over the next few years — not that it makes either plan the better solution. Both strategies make sacrifices in one area to see gains elsewhere. The real trick is comparing those factors to make the best decision possible for the nation.

[Image: CC7/Shutterstock]

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  • Cprescott Cprescott on Aug 08, 2019

    This report is dishonest. It assumes that vehicles could have been made to meet the outrageous and arbitrary Obama standards that were designed to limit personal choices and to make what was available more expensive so as to curb the use of vehicles PERIOD. This was nothing about being green or environmentally sound policy. Like all of the modern era global climate change items, this is a whole package of wet dreams that the left of left left want to use to redistribute income from those who produce to those who have an excuse. There is nothing more or less about this policy initiate. And if you really cared about fuel economy, you alone could save 25% without spending a dime by learning how to drive your vehicle efficiently and to obey posted speed limits and to anticipate traffic lights and to package your trips into one. But then again, that would mean you are free American who chooses for yourself rather than someone whose heart bleeds for you.

  • Jeff S Jeff S on Aug 08, 2019

    @highdesertcat--Not just V8s but you might see people willing to spend money on having vehicles rebuilt so that they can keep them longer. I question the longevity and reliability of a turbo charged 3 cylinder with a CVT. Many many transmission failures with CVTs especially Nissan and if you are going to spend 4k to 6k for a new transmission that will fail again it might make more sense to keep a vehicle you know is reliable. Many Nissans with CVTs are lucky to make it to 100k miles. From what I have read is that many of the CVTs cannot be rebuilt and the belt inside the transmission cannot simply be replaced. Maybe if these vehicles were really cheap one could justify buying one since you would know that they will not last and are willing to pay a lot less for them, in other words these are disposable vehicles. If a vehicle is only designed to last 5 to 10 years then I don't want to pay upwards of 30k for it.

    • See 1 previous
    • Highdesertcat Highdesertcat on Aug 09, 2019

      Jeff S, as I aged and could better afford new cars, I found myself adopting a new philosophy re cars and trucks; one that states that “All vehicles you want are good as long as the factory warranty lasts.” Since 2008, when we bought our first Japan-made Highlander and then switched over to the Toyota fan club, we have adhered to that new philosophy and get rid of a vehicle ~the time the factory warranty expires. It has worked well for us. I’m too old now to be writhing around on the cement drive way, tooling and wrenching on my cars. I still do oil&filter changes, alternator R&R, serpentine belt replacements, but no more labor intensive stuff like waterpump changes, brake jobs, tire rotation, and the like. Currently we do not own ANY vehicles but that is driven by our residing outside of the US much of the year. Once we get too old to travel comfortably, I’ll reassess the situation and buy two more vehicles, one for my wife, and a truck for me. Based on previous ownership experience, I’m inclined to buy another new Sequoia for Kitty, and another Tundra for me. No CVT or 2-cyl vehicles for me.

  • SCE to AUX Probably couldn't afford it - happens all the time.
  • MaintenanceCosts An ugly-a$s Challenger with poor equipment choices and an ugly Dealership Default color combination, not even a manual to redeem it, still no sale.
  • Cha65689852 To drive a car, you need human intelligence, not artificial intelligence.Unfortunately, these days even human brains are turning into mush thanks to addiction to smartphones and social media.
  • Mike1041 A nasty uncomfortable little car. Test drove in 2019 in a search for a single car that would appease two drivers. The compromise was not much better but at least it had decent rear vision and cargo capacity. The 2019 Honda HRV simply was too unforgiving and we ditched after 4 years. Enter the 23 HRV and we have a comfy size.
  • SCE to AUX I wonder who really cares about this. "Slave labor" is a useful term for the agendas of both right and left."UAW Wants Auto Industry to Stop Using Slave Labor"... but what will the UAW actually do if nothing changes?With unrelenting downward pressure on costs in every industry - coupled with labor shortages - expect to see more of this.Perhaps it's my fault when I choose the $259 cell phone over the $299 model, or the cheaper parts at RockAuto, or the lower-priced jacket at the store.Do I care about an ethical supply chain? Not really, I just want the product to work - and that's how most consumers are. We'd rather not know.Perhaps the 1990s notion of conflict-free, blood-free, ethically-sourced diamonds will find its way into the auto industry. That would be a good thing.