"This moment of peril must be turned to one of progress," President Barack Obama said yesterday, as he signed his first two Presidential Memoranda, both aimed at getting the United States on the path to energy independence.
The president directed the Department of Transportation to establish higher fuel efficiency standards for carmakers' 2011 model year. The standard, known as Corporate Average Fuel Economy, or CAFE, standard, was established in 1975 in the wake of the Arab oil embargo.
In model year 1990, the passenger car standard was amended to 27.5 miles per gallon, and it has remained at this level. In 2007, new light truck standards of 22.2 mpg were issued. The new efficiency standards called for raising the average fuel economy to 35 miles a gallon for both cars and trucks by 2020.
The second memo paves the way for California and 18 other states to raise tailpipe emissions standards for the greenhouse gas carbon dioxide above and beyond the national standard.
It all really means more regulation and efficiency demands by politicians on the nearly bankrupt auto industry. Consider that there are already three voices on fuel economy and carbon dioxide emissions in the United States. The National Highway Transportation Safety Administration, the EPA and States like California each have different standards, different structures and different timelines.
The car makers now have less than three months to prove to Washington that they can survive after recieving government bailout money last month. Its clear that the Obama administration wants Detroit to make smaller, more fuel-efficient vehicles. However, if we keep seeing cheaper energy, people won’t buy these fuel-efficient vehicles. People will return to light trucks and vehicles with utility and size instead.
So, there may be an eventual conflict between what the government wants the carmakers to do (build smaller cars to adhere to aggressive environmental regulation) and what the automakers need to do in order to get the consumer to purchase cars and trucks. After all, political sound bites and new auto regulations do nothing to help the bankrupt auto industry turn a profit.
Also Read Todays Daily Vu: An Offshore Wind Farm Caught In A Political Breeze
The president directed the Department of Transportation to establish higher fuel efficiency standards for carmakers' 2011 model year. The standard, known as Corporate Average Fuel Economy, or CAFE, standard, was established in 1975 in the wake of the Arab oil embargo.
In model year 1990, the passenger car standard was amended to 27.5 miles per gallon, and it has remained at this level. In 2007, new light truck standards of 22.2 mpg were issued. The new efficiency standards called for raising the average fuel economy to 35 miles a gallon for both cars and trucks by 2020.
The second memo paves the way for California and 18 other states to raise tailpipe emissions standards for the greenhouse gas carbon dioxide above and beyond the national standard.
It all really means more regulation and efficiency demands by politicians on the nearly bankrupt auto industry. Consider that there are already three voices on fuel economy and carbon dioxide emissions in the United States. The National Highway Transportation Safety Administration, the EPA and States like California each have different standards, different structures and different timelines.
The car makers now have less than three months to prove to Washington that they can survive after recieving government bailout money last month. Its clear that the Obama administration wants Detroit to make smaller, more fuel-efficient vehicles. However, if we keep seeing cheaper energy, people won’t buy these fuel-efficient vehicles. People will return to light trucks and vehicles with utility and size instead.
So, there may be an eventual conflict between what the government wants the carmakers to do (build smaller cars to adhere to aggressive environmental regulation) and what the automakers need to do in order to get the consumer to purchase cars and trucks. After all, political sound bites and new auto regulations do nothing to help the bankrupt auto industry turn a profit.
Also Read Todays Daily Vu: An Offshore Wind Farm Caught In A Political Breeze
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