In mid February, FIAT Chrysler Automobiles (FCA) released a statement that they had paid $77m in penalties for 2016 model vehicles that did not meet the CAFE requirements for that year. Apparently they were not the only manufacturer to pay a penalty, however they took up the biggest portion of the penalties incurred in the US.
Despite agreeing to the gradual increase in fuel economy and reduction in emissions, it appears that many of the manufacturers cannot meet these targets – possibly thanks to Volkswagen! Remember, they were caught providing the test results that the US Government wanted to see, despite their vehicles not being able to deliver the same results in real world driving conditions. It looks like the manufacturers have to show real data and they cannot find those extra miles for economy or lose the kg of carbon emissions!
FCA has another problem, although one that they have had many years to rectify, and that is that several of their vehicles were reclassified from light truck to passenger car status and this is hurting them. This affects four vehicles, three of which are Jeep and one is a related Dodge. Interestingly, removing these from the truck list has dramatically improved that segments figures!
The regulations allow manufacturers to claim a credit for a model year vehicle that is better than the official figures for that year, so it is possible to apply that credit against the overall penalty. For emissions, manufacturers are allowed to buy credits from their competitors and this is something that FCA is also doing – buying them from Tesla and Toyota, the two main electric or hybrid manufacturers. That is great to help Tesla’s financials however not so good for FCA!
As you can imagine, FCA is lobbying the current Administration who have suggested that the annual changes in figures should stop and be static. FCA suggest that it is difficult to manage these regulations based on assumptions from seven years ago. However we contend that if you know that the figures are going to change annually, then it would be in your best interests to figure the resolution out earlier. In some respects, this is one reason why we fitted the GOFAR Ray to the Abarth – we wanted to see what the true fuel economy costs were.
The National Highway and Traffic Safety Administration (NHTSA) were quoted as saying that the penalty payments they are receiving have steadily risen over the years as manufacturers struggle to balance economy/emissions with a vehicle price point that encourages sales. They were quoted as saying that the penalties prior to any credits being applied would be over $1bn for both model years 2017 and 2018!
You do have to wonder what is happening with hybrid technology, which was supposed to resolve this issue. Perhaps it is time for normal vehicles to rise in price to encourage more hybrids to be developed and sold. It seems that the mix of vehicles on the market does not match the Government requirements and it would be a pity to see FCA, as an example, get bailed out by the US Government for collapsing under the weight of their own penalties!
Go to gofar.co to review the Ray. If you like it, apply the voucher MW1 to get free shipping!