A few weeks ago I described what the CAFE figures meant. Now I read that these targets are going to get adjusted – because people in the US are buying too many SUVs and trucks!
The plan was for the fleet average to be 54.5 miles per gallon split across cars, SUVs and trucks. However because the price of oil has been relatively low of late, more buyers are trading up to an SUV or truck, which means that the fleet average for sales is lowering. Not enough economical cars are being sold to balance the thirsty trucks being bought, so the US regulators have realised that the manufacturers are in an uphill battle to reach the 54.5 mpg target by 2025.
A joint report by the Environment Protection Agency (EPA), National Highway Traffic Safety Administration (NHTSA) and the California Air Resources Board (CARB) started by outlining all the good things the manufacturers were doing with new technologies to lower emissions and improve fuel economy. This has lead to lighter vehicles, better tyres and new materials in engines that all contribute to better results. Even the introduction of hybrids and full electric vehicles was recognised as a big step forward and would lead to the manufacturers meeting the CAFE target – provided sales were made up of the right mix of vehicles.
The problem is – the mix is all wrong with the heavier vehicles in high demand. The estimate of sales by the Government was 67% cars with 33% trucks and SUVs. Sales data is showing a 50/50 split at the moment.
So to save face, the Government has said that the CAFE target was simply “an estimate” of where they thought the industry would be and not a mandate with fines attached. That all sounds like local industry protection to me – the US Government has been very quick to fine international manufacturers when they couldn’t meet earlier targets! Lowering the targets “reflects consumer demand” the Alliance of Automobile Manufacturers, a trade group stated, and they were also concerned that the cost to meet the target would mean more expensive cars which in their view would mean lower sales and as such hinted job losses in the US.
On the flip side, the Safe Climate Campaign suggested that the manufacturers could in fact “influence consumer demand” with the products they develop and sell, and also suggested that the dollars spent to market SUVs could be redirected to help hybrid and electric car sales increase.
The US Government has until April 1st next year to decide what to do. As that is April Fool’s Day, don’t be surprised at their decision!