New vehicle efficiency rules could paralyze recovery 

Just what a struggling American economy needs: new fuel efficiency standards that will make cars and trucks more expensive. The new standards, issued jointly by the U.S. Department of Transportation and Environmental Protection Agency, will cost automakers $51.5 billion over the next five years and add $985 to the price of an average vehicle in 2016, according to the regulators.

The “historic new rules” are based on the stringent standards California adopted to halt supposedly man-made global warming.  However, as a 2004 CATO study pointed out. “even if every state in the union adopted California’s new program, global temperatures would drop by something less (actually, probably far less) than one-tenth of 1 degree Fahrenheit by 2050.”

The new rules, which affect every state in the union, require 2016 model-year vehicles to boost fuel economy standards by 2 miles per gallon over current requirements in order to achieve a combined average vehicle emission level of 250 grams of carbon dioxide per mile.

The current standard, which has been in place since 1985, is 27.5 miles per gallon. Passenger cars will have to average 33.3 mpg in 2012 and 37.8 mpg by 2016. Light trucks, including SUVS, pickups and vans, will be required to average 25.4 mpg in 2012 and 28.8 mpg by 2016.

And there are signs that heavy commercial vehicles will be next.

Allen Schaeffer, executive director of the Diesel Technology Forum, notes that truck manufacturers have been focusing on the “emission side of the ledger for over a decade now, to the detriment of fuel economy,” which he called “near opposite and competing forces in diesel engine design.” Now the government apparently wants them to do a complete 180 and focus on fuel efficiency instead.

“The states aren’t prepared for this, the path of implementation is unclear, and the costs and delays will likely prove severe.  The result could be a paralyzing slowdown in business expansion and job creation at a time when millions of Americans are still struggling to find work,” the American Petroleum Institute said in a statement.

Just what the U.S. economy needs: Front-loaded costs during a recession in exchange for supposed future savings on fuel that might never materialize. The Obama Administration is apparently working from the Catbert book on management.

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Doug Graham

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