CAFE costs are mounting...

[LS2JSTS]

CAFE fuel rules to hike car costs


"Sharply higher fuel efficiency standards by 2025 could force vehicle prices up by nearly $10,000, reduce sales by 5.5 million vehicles annually and eliminate more than 260,000 jobs, according to a study by the Ann Arbor-based Center for Automotive Research.

The center's study, released Tuesday, predicted it will cost between $3,744 and $9,790 per vehicle to develop and produce cars that meet a range of between 47 and 62 mpg — a span being considered by federal regulators — by 2025.

That's far higher than the $770 to $3,500 per vehicle estimate issued by the National Highway Traffic Safety Administration and the Environmental Protection Agency."

"The 2012-16 standards alone will cost the auto industry $51.5 billion, NHTSA has projected."

"Environmentalists who want the fleet average set at 60 mpg or more have won the backing of prominent governors and have touted polls claiming Americans support that standard.

Automakers are running radio spots aimed at policymakers, warning of potential job losses if regulations are set too high.

The center warned Americans' personal mobility — and the freedom to drive a car — is "under threat by extreme mandates."

"The risk connected to mandating permanent fuel economy standards in the long run is very serious," the report said."

 

[Jeff_in_VABch]

That would cut 2010 sales numbers in half. That would probably permanently end the auto industry as we know it.

Strong finish for 2010 domestic auto sales
By Ed Brayton | 01.05.11 | 7:29 am
Comments ShareThe Big Three automakers finished 2010 on a high note, each increasing year to year sales in December. Ford showed the lowest increase of 4 percent; GM’s sales grew by 8 percent and Chrysler was up by 16 percent.

Overall American auto sales was up 11 percent, but Toyota again saw their sales drop by 6 percent.

For the full year, all three American automakers posted significant gains in unit sales. Chrysler sold 230,934 vehicles for a 17 percent gain. Ford sold 1,964,059 vehicles, also up 17 percent. And General Motors sold 2,211,699 vehicles, up 7 percent over 2009.

Total domestic auto sales rose 11 percent to 11,590,274 vehicles sold. But the trend is even higher. December’s auto sales extrapolate out to a yearly sales rate of 12.6 million units.

Glad I bought the wife a 19MPG vehicle while you can still get them for only $48K.

 

[IndyIan]

Originally Posted By: Jeff_in_VABch
That would cut 2010 sales numbers in half. That would probably permanently end the auto industry as we know it.


I think it would definetly change cars from almost disposable fashion accessories, to highly engineered function first transportation tools that people will own for much longer. A Prius is almost there already for a 60mpg car, and if they made it plug in, its easily there.
So to average 60 mpg for the nation, more short city commuters will need to have electric cars, to counter act the folks who still need/want a larger gas vehicle.
Keep in mind CAFE doesn't include commercial vehicles so big trucks will still be available and excluded from the average.

 

[OldCowboy]

The Center for Automotive Research has been predicting doom and destruction since the first CAFE standard was released. With each increase in CAFE standards, the increases in car prices and cost in jobs has always been significantly lower than CAR's predictions.

 

[LS2JSTS]

Originally Posted By: IndyIan
Originally Posted By: Jeff_in_VABch
That would cut 2010 sales numbers in half. That would probably permanently end the auto industry as we know it.


I think it would definetly change cars from almost disposable fashion accessories, to highly engineered function first transportation tools that people will own for much longer. A Prius is almost there already for a 60mpg car, and if they made it plug in, its easily there.
So to average 60 mpg for the nation, more short city commuters will need to have electric cars, to counter act the folks who still need/want a larger gas vehicle.
Keep in mind CAFE doesn't include commercial vehicles so big trucks will still be available and excluded from the average.



Toyota and the other members of the Alliance of Automobile Manufacturers have all agreed that the NHTSA cost estimate is too low. 2 of the member companies that have reviewed this study from CAR agree that these numbers are actually "conservative".


Taking Toyota as an example since you mentioned the Prius and it's 50 mpg. Toyota has the current high water mark for corporate fleet averages, last I checked it was right around 31.X mpg for their entire fleet. It's easy to see that even with the large number of Prius sales they enjoy, even Toyota would have to drastically revamp their entire fleet to come anywhere near these new numbers.

In the end these draconian requirements will affect consumers choice to a huge extent. The manufactureres simply wont be able to offer the same mix of vehicles to meet the new standards and still avoid massive fines from the feds.

 

[ericthepig]

Worse yet - my '88 Mazda 323 got 40mpg in it's early days and 38mpg in 2008 when I sold it. Now you have to have a state of the art high tech high cost hybrid to get that same mileage.

Gov't central planning. Really discouraging.

 

[Jim 5]

That's the good government deciding what's in everyone's best interests.

Sure, says the government, you still have the liberty to buy any car you want, we'll just make sure most can't afford it. After all, we don't think it's good for society for people to be driving around in cars anyway.

Expect more cash for clunkers programs to remove viable and inexpensive used alternatives from the north american fleet, making it harder to opt out.

 

[Tempest]

Originally Posted By: IndyIan
Originally Posted By: Jeff_in_VABch
That would cut 2010 sales numbers in half. That would probably permanently end the auto industry as we know it.


I think it would definetly change cars from almost disposable fashion accessories, to highly engineered function first transportation tools that people will own for much longer. A Prius is almost there already for a 60mpg car, and if they made it plug in, its easily there.
So to average 60 mpg for the nation, more short city commuters will need to have electric cars, to counter act the folks who still need/want a larger gas vehicle.
Keep in mind CAFE doesn't include commercial vehicles so big trucks will still be available and excluded from the average.


So you want personal transportation to be out of the reach of poorer people. Got it.

 

[Win]

My understanding is that there is no longer an opt out option of just paying a fine for each car that fails to meet the CAFE standard so the moderate to large size car will surely become extinct very shortly.

Our '04 Jaguar is not that big a car, is made wholly from lightweight aluminum, has only a dinky (4.2 litre) V8 that is state of the art save for not having spark direct injection, has a six speed, and it can only get in the low 30's on the highway at 70 mph. It won't meet the new standards, much less the 2025 standards. And it wasn't cheap to acquire - it cost more than a lot of starter homes around here.

Get the car you want while you can and can afford it. They are almost certainly going to become very smaller, and much more expensive, and much more dangerous. Many people will die because the government has an idealogically (sp?) driven energy policy of opposing all domestic energy production. The rest of us will just get fleeced when we buy a car, or flick a light switch on.

 

[KrisZ]

I guess it's a perfect time to buy whatever you want now and store it.
Just imagine what a run of the mill, V6 equipped, mid size sedan would be worth in a market filled with [censored] boxes that are in the $40k range.

 

[Smokescreen]

If these OP numbers were accurate, there would be a great movement to used vehicles, or slightly used. Let the original purchaser take the biggest depreciation hit and still enjoy 90+% vehicle life...but then again if there was this shift to buying used, maybe the depreciation scale that we are accustomed to presently would be altered.

 

[LS2JSTS]

It's a perfect time to write a letter to your congressional and senate representatives.

We need a national referendum on this energy policy issue. We need to determine just how much support all these green initiatives actually have amongst the people, and let the interested parties sit on the sideline for a bit. It seems to me that our voice is constantly drowned out by the paid hacks on either side, and yes I include Auto Alliances in this group, just like I do the far leftist greenie groups.

We need to determine what the people believe, and what they are willing to pay for and give up to support these beliefs...otherwise we are strangling ourselves for nothing.

Without a set in law national energy policy we are left with the whims and notions of those that happen to be in power. Continually legislating like a king, making new rules by fiat and simple signature. New rules and regs that can ruin an industry in an instant, can close down whole areas for oil development on a whim, it's got to stop....This countries inability to handle the enrgy issue openly and honestly is killing us...a slow death of a thousand cuts.

 

[Vikas]

Are you talking about $10,000 in 2025 time frame? Is that like $1000 in today's dollars??

 

[Jim 5]

Originally Posted By: LS2JSTS
It's a perfect time to write a letter to your congressional and senate representatives.

We need a national referendum on this energy policy issue. We need to determine just how much support all these green initiatives actually have amongst the people, and let the interested parties sit on the sideline for a bit. It seems to me that our voice is constantly drowned out by the paid hacks on either side, and yes I include Auto Alliances in this group, just like I do the far leftist greenie groups.

We need to determine what the people believe, and what they are willing to pay for and give up to support these beliefs...otherwise we are strangling ourselves for nothing.

Without a set in law national energy policy we are left with the whims and notions of those that happen to be in power. Continually legislating like a king, making new rules by fiat and simple signature. New rules and regs that can ruin an industry in an instant, can close down whole areas for oil development on a whim, it's got to stop....This countries inability to handle the enrgy issue openly and honestly is killing us...a slow death of a thousand cuts.


I agree. How far we have come from the founding ideals of democracy and liberty.

 

[Tempest]

Quote:
Without a set in law national energy policy we are left with the whims and notions of those that happen to be in power.

What should such a policy say and how do you insulate said policy from future politicians?

 

[LS2JSTS]

Originally Posted By: Vikas
Are you talking about $10,000 in 2025 time frame? Is that like $1000 in today's dollars??


Do you think your $200,000 house will be worth $2,000,000 in 14 short years?

We all better hope inflation doesn't begin to get that out of hand.

 

[A_Harman]

CAFE has always been a bad piece of public policy because it makes automakers responsible for the choices made by their customers. Corporate Average Fuel Economy is based not only on the fuel economy of the cars available for sale, but also on the actual number of each model sold. If an automaker only had 2 models for sale, one a 10-mpg SUV, and the other a 40-mpg econobox, the corporate average fuel economy would only be 25 mpg if the automaker sold equal numbers of each model. But if their customers bought 90% SUV's and 10% econoboxes, the corporate average fuel economy would be 13 mpg, and the automaker would owe the gummint a heap of penalties. Then the automaker would raise prices and pass the hidden tax on to their customers.

This has been a problem for about 15 years, when the SUV boom started. Automakers began building "segment buster" vehicles such as the PT Cruiser and Chevy HHR which had just enough cargo space to be classified as trucks, but were built on small car platforms that got good fuel economy.

Another ploy used to paper over the obvious failings of CAFE was the creation of Flex Fuel E85 vehicles. The reason that most flex fuel vehicles built are trucks is that the EPA only applies the amount of gasoline that is burned when they are fueled with E85 to the calculation of fuel economy. This means that if a Flex Fueled truck gets 10 mpg on E85, the EPA would rate its fuel economy at 66 mpg for purposes of calculating its contribution to the corporate average fuel economy. It doesn't matter that very few people ever run their FF vehicles on E85, this is how the gummint does the calculation.

 

[LS2JSTS]

Originally Posted By: Tempest
Quote:
Without a set in law national energy policy we are left with the whims and notions of those that happen to be in power.

What should such a policy say and how do you insulate said policy from future politicians?


I can't begin to act as if I personally know enough to write the policy....but I know where I would start.

I would start by eliminating the executive branches ability to legislate energy policy by executive order...I'd also devise a system by which the price of gasoline in this country more closely reflected the true cost that is borne by it's production...and then I'd eliminate CAFE altogether...a good start in my book.

Success would protect it, failure would rightly leave it open for future changes...there is no legislation that can't be overturned if the will exists to do so.

 

[A_Harman]

Originally Posted By: Jeff_in_VABch
For the full year, all three American automakers posted significant gains in unit sales. Chrysler sold 230,934 vehicles for a 17 percent gain. Ford sold 1,964,059 vehicles, also up 17 percent. And General Motors sold 2,211,699 vehicles, up 7 percent over 2009.



Chrysler only sold 230k vehicles in 2010? Doesn't seem like there is a Big 3 anymore. More like a Big 2 and a Wannabe. How can Chrysler survive if their volume is only 1/10th that of GM and Ford? They can't take advantage of large economies of scale.

 

[Ursae_Majoris]

And we thought that economy is bad now. Our industrial base will cease to exist. Even transplants will close down.

Are we going going to call 2010-2030 the Lost Decades?

I better hold on to my Axiom. I won't be able to get a replacement. With a trailer it doubles as truck.