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Automakers Urge Trump To Revisit Fuel Economy Rules

Automakers Urge Trump To Revisit Fuel Economy Rules

The U.S. divisions of 18 automakers are urging President Donald Trump to revisit recently finalized fuel economy standards. The group has reportedly sent a letter to President Trump to express their desire for him to “reset” the review of the new fuel economy standards.

The letter, viewed by Reuters, is signed by the chief executives of General Motors, Ford Motor Company, Fiat Chrysler Automobiles, along with the top North American executives at Toyota Motor Corporation., Volkswagen AG, Honda, Hyundai, Nissan. and others. The letter expresses the automakers’ concern that the new fuel economy regulations will negatively impact jobs in the U.S.

Bringing up job loss is likely an attempt to get President Trump’s attention, given job creation is a primary theme of his Administration. The letter reportedly cites job losses of up to one million, a figure also thrown out by Ford CEO Mark Fields at a recent meeting with President Trump at the White House. The one million job loss figure is contested and isn’t well researched.

All of this is stemming from the finalization of new fuel economy standards that occurred on January 13th by President Obama’s EPA. The EPA originally had until April 2018 to review the new standards, which were announced in 2012 by the Obama Administration. In an attempt to secure some of his legacy on climate change, President Obama’s EPA pushed up the finalization of the new rules to this January.

The new rules call for fleet-wide fuel economy averages of 54.5 mpg by 2025. Many automakers have expressed concern that the benchmarks are not going to be easy to achieve.

Despite nearly all automakers being on the same page with the new rules, advocates say the rules are not going to have that much of an impact on the industry. They also claim and point out that consumers are already benefiting by paying for less gas.

Thus far the Trump Administration has not replied to the automakers’ letter.





 

About Nick Saporito

AutoVerdict Senior Editor Nick Saporito began writing about cars at age 13. Nick ran a couple of automotive enthusiast sites for several years, before taking some time off to focus on his career and education. By day he's a marketing executive in the telecom world and by night he hangs out here at AV. You'll find him focusing on tech, design and the industry's future.
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  1. ChevyRules
    Dequindre
    Good. The program should be scrapped altogether. Let the market decide what automakers are to build.


    Trade CAFE for the European approach and increase the gas tax ( and make it law that the increased gas tax goes towards rebuilding our roads and bridges and not allowed to be tapped for other projects)..... That alone will effect what the market will demand and thus automakers building more efficient vehicles.

    If the market was left to their own devices, it won't be 2009 all over again, but the 1970's, 1980's, and 2005 all over again with the automakers only currently building vehicles that the current market demands, and not be prepared for any market shifts. The market has proven they can't be trusted in maintaining a steady direction and has a short term view. Gas prices are cheap now so of course they go back to buying SUV's/CUV's even though it won't remain at these levels forever. They don't have the ability to think long term and just react to what it is now.

    Either approach will have backlash though. Choose what you would rather have happen. Inflate the price of gas to change consumer taste or make the automakers make their vehicles more efficient by law. Take your pick.
    Dequindre
    mrickan
    If you let the inmates run the asylum it will be 2009 all over again.


    2009 wasn't caused solely by the rise in gas prices. Mismanagement of the D3 was happening since the 1960's.
    mrickan
    Dequindre
    Good. The program should be scrapped altogether. Let the market decide what automakers are to build.


    If you let the inmates run the asylum it will be 2009 all over again.
    donmateo
    CAFE is garbage and adds unnecessary cost to vehicles which is then passed onto consumers. I forget where, but I read that on average, regulations add near $10k to a new car price. Seeing how much regulation costs businesses, it's unsurprising.
    Tone
    Dequindre
    Good. The program should be scrapped altogether. Let the market decide what automakers are to build.


    That would make sense if the externalities of poor fuel economy (e.g. environmental, balance of trade, etc.) were priced into the market. That could easily be done with taxes on fuel or other fees -- mechanisms which are arguably more efficient -- but they seem politically very challenging. They also impact low-income folks disproportionately. CAFE has been a way to do the same thing without the political and low-income issues. More importantly, the updated CAFE is designed to allow the market to decide what automakers build -- while building more efficient versions. It's not going to be easy to just offset a lot of low mpg trucks by selling economy cars at a loss.
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