Levin CAFE loophole for automakers appears dead
A proposal put forward recently by Sen. Carl Levin, D-Mich to provide a way out of new fuel economy requirements for carmakers if they committed to using alternative powertrains on all their cars by 2020 appears to have died on the vine. It looks like there is little or no support for the idea in the Senate although Levin may propose a revised version of the bill at some point. As usual all the supporters of the beefed up standards are more than willing to make the politically expedient move of raising the requirements. However, no one seems willing to step up and do something to ensure that oil prices remain at a sufficient level to ensure demand is there from consumers for the higher mileage vehicles.
[Source: Automotive News - Sub. Req'd]
Reader Comments (Page 1 of 1)
Marcus 11:38AM (6/14/2007)
Excellent point, Sam - it's all about demand, not supply. Making manufacturers build cars that the consumers do not want doesn't solve anything...
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Tim 12:09PM (6/14/2007)
"As usual all the supporters of the beefed up standards are more than willing to make the politically expedient move of raising the requirements. However, no one seems willing to step up and do something to ensure that oil prices remain at a sufficient level to ensure demand is there from consumers for the higher mileage vehicles."
Higher fuel cost would drive consumer demand for more MPG and make people think twice about how they use their vehicles. CAFE is a political cop-out for the gutless in Washington to make it look like they're making a real change while not risking the wrath of voters by imposing a higer fuel tax. CAFE will make a change but with the age and makeup of todays personal vehicle fleet it'll take a couple of decades to have a big impact in our fuel usage.
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Joseph 4:26PM (6/14/2007)
As much as I'd like to have a tax that keeps fuel prices high and thereby increasing demand for fuel-efficient vehicles, I do not think it is ethical nor is it good for the market. Economics is a delicate thing, the gov't already artificially lowers the price of all sorts fo things (ethanol).
Having the gov't create demand for fuel-efficient vehicles through controlling gas prices seems to spell disaster to me. Besides, what are the chances of prices going down very much anyway?
On a side note:
"they committed to using alternative powertrains on all their cars by 2020"
If this replaced the CAFE standards all our cars would be flex-fuel (and few would have an ethanol station nearby so it's useless) or "mild" hybrids.
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Chris 2:13PM (6/14/2007)
Maybe CAFE isn't as good a solution as raising gas prices, but who cares? No politician is going to raise the gas tax, and for good reason, they would be voted out of office and someone else voted in who would undo the damage. These politicians are carrying out the will of the people! Representative democracy, that's how it works.
CAFE standards will at least reduce our consumption somewhat, however, and force the automakers to produce more efficient vehicles. Like GM so eloquently pointed out, since CAFE was introduced, miles driven has increased 100%, whereas oil usage has only increased 60%.
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UH2L 4:37PM (6/14/2007)
Yes, the manufacturers can be forced to make vehicles that nobody will want to buy and then the whole new law will be a bust. I foresee a big car market for high performance used performance cars assuming fuel prices don't rise too much higher. People still buy many guzzlers today.
I like the approach that I thought of a while ago and that the Dutch are using. Over a certain fuel efficiency, buyers get a tax rebate, under that number, they pay a guzzler tax. If you put it on a sliding scale, it's relatively fair, although it doesn't account for vehicles that get low mpg but regularly carry multiple people. One vehicle that carries 7 people at 20 mpg is equivalent to getting 140 mpg with a vehicle that only carries one person regularly.
Atul
http://www.thingsivenoticed.com
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AMcA 11:01PM (6/14/2007)
Maybe, just maybe, our geniuses in Washington decided to leave automobile design to the automobile makers, who may, maybe, just know something more about it than the Solons in the Senate.
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Chris 1:06AM (6/15/2007)
Well the automakers don't give a shit how much fuel we burn. They can't be trusted. Washington - via the people who elected them - is forced to step in.
As for Atul's idea of a gas tax, that doesn't force anyone to buy efficient vehicles. This is America. Everyone who buys a $40k Tahoe/Durango/whatever today isn't going to flinch at paying $42k for it tomorrow. It would have to be an outlandish, ridiculous tax for habits to change, and people would cry foul and elect Republicans to get rid of the tax anyway.
CAFE standards are the best we can do, and they have worked great so far. We just need to keep ratcheting it up. The automakers always fight change, but the change will come, and they'll have to adapt. They won't stop building Suburbans, but maybe this way the two-mode hybrid will become standard fare instead of an option you won't see on the roads often.
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gsolman6 11:33AM (6/15/2007)
I'm really glad to see that this loophole died. If I read it right that mean that ethanol will not get another artificial boost and the likes of Nissan Armadas with 9/13 mpg on ethanol will not be as frequently seen. I think the automakers liked the "alternative" powertrain option b/c it gave them the ability to do the least amount of work for a perceived significant gain.
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UH2L 11:23AM (6/15/2007)
Chris, I agree to a point that a small guzzler tax alone won't change anybody's mind, but a large enough one combined with rebates for more efficient vehicles will move the needle somewhat. People like free money.
We all know the only solution is a higher gas tax, but our politicians would never get elected by advocating one. So it's the consumer and the voter that are the problem. We generally don't care. The vehicle manufacturers should share in some of the blame, but they have to sell what people want to stay profitable, or they die.
People don't really want fuel efficient vehicles. If they did, more people would buy 4-cylinder mid sized sedans instead of the same models with V6's. People want power and luxury. The car companies should offer the same options on the more efficient powertrain versions, but other than that, the fact that they offer more efficient alternatives should be sufficient. We conspicuously consume and that needs to be changed, but since nobody is willing to do that, the car manufacturers share the brunt.
Having worked at a car company, I can tell you that reaching the CAFE targets is going to be very difficult without making the vehicles significantly more expensive due to new technology and more expensive lightweight materials. This too will drive more people to purchase used vehicles which will be counterproductive to reducing oil consumption.
Atul
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UH2L 11:19AM (6/15/2007)
Chris, I agree to a point that a small guzzler tax alone won't change anybody's mind, but a large enough one combined with rebates for more efficient vehicles will move the needle somewhat. People like free money.
We all know the only solution is a higher gas tax, but our politicians would never get elected by advocating one. So it's the consumer and the voter that are the problem. We generally don't care. The vehicle manufacturers should share in some of the blame, but they have to sell what people want to stay profitable, or they die.
People don't really want fuel efficient vehicles. If they did, more people would buy 4-cylinder mid sized sedans instead of the same models with V6's. People want power and luxury. The car companies should offer the same options on the more efficient powertrain versions, but other than that, the fact that they offer more efficient alternatives should be sufficient. We conspicuously consume and that needs to be changed, but since nobody is willing to do that, the car manufacturers share the brunt.
Having worked at a car company, I can tell you that reaching the CAFE targets is going to be very difficult without making the vehicles significantly more expensive due to new technology and more expensive lightweight materials. This too will drive more people to purchase used vehicles which will be counterproductive to reducing oil consumption.
Atul
Reply