Thursday, July 3, 2008

CAFE -- It's Gonna Cost You

Earlier this year, the Bush administration surprised a lot of green activists by actually surpassing the already challenging CAFE standards for 2011-2015. While automakers like Toyota, Ford, and GM are quietly going about the business of hitting those targets, BMW is speaking up and saying that the targets are unattainable. The German automaker has asked the Bush administration for an alternative plan that helps out the hardest hit automakers, and the new rules are a punch to the gut for the Bavarian Motor crew.

While the corporate average for cars and trucks is 35.7 mpg and 28.6 mpg by 2015, BMW has to hit 37.7 mpg and 31.7 mpg, respectively. The reason for the disparity is the sliding scale the government used to account for differences in size in each automaker's lineup. Since BMW doesn't sell pickup trucks and it has plenty of small and midsize offerings, BMW has to hit higher fuel economy standards. What the CAFE numbers don't take into account is the fact that all BMWs are RWD, and there isn't a four cylinder engine to be found (in the U.S., yet). The Bush administration says its final fuel economy numbers will become public by the end of the year, and if companies like BMW don't get special dispensations, look for there to be smaller engines on the horizion, or bigger fines. 
Autoblog -- BMW calls CAFE 'not feasible'

Ten months ago, Bob Lutz said GM cars would be $5,000 more expensive if the Bush administration got its way with fuel standards by raising fuel economy 4% every year through 2017. Bush didn't get his way, but Congress did with its newly-signed-into-law energy bill that requires automakers have a fleet average of 35 MPG by 2020. According to Lutz, that's going to be even more expensive: "This is going to be a net average cost of $6,000 per vehicle, which will have to be passed onto the consumer."

Lutz said that the premium would actually range from $4,000 to $10,000, and that "it won't come all at once, because 35 mpg doesn't kick in all at once." No one said that saving the world was going to be cheap -- but $6,000 per vehicle? We look forward to figuring out which vehicles will bear the brunt of the plan. Add $10,000 to the price of a ZR-1 and no one's really going to notice. Add $6,000 to the price of a CTS and, depending on how much more expensive its competition gets, things could get interesting. Add $4,000 to the price of an Aveo and you've probably sent a fair number of buyers elsewhere.
Autoblog Green -- Lutz says new CAFE standards will increase car price by $6 grand

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