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.

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