New CAFE rules affect makers differently

[camaro5]

Some executives predict Porsche will pay fines rather than change lineups.
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By HARRY STOFFER, AUTOMOTIVE NEWS

Mercedes' cars would have to achieve better average fuel economy than Toyota's. BMW's light trucks would have to get 4 mpg more than those built by General Motors.

These are among the startling outcomes projected for the 2015 model year under proposed federal fuel economy regulations. Under the new rules, the relative increase is highest for the smallest vehicles.

Vehicles are measured by their footprint--roughly the area bounded by the wheels.

The rules, unveiled last week by the Bush administration, represent the first big step in enforcing a landmark new energy law. The law mandates a 40 percent increase in car and truck fuel economy by 2020, to an industry average of 35 mpg.

The administration regulations anticipate a fast start, calling for 25 percent improvement in the 2011-15 model years.

The effects of the rules would vary dramatically among automakers. The winners are companies such as General Motors, Toyota and Chrysler — mass-market manufacturers with broad product portfolios. The losers are independent luxury brands such as Porsche, BMW and Mercedes.

Regulators based the new standards on their projections of the number of cars and trucks of different sizes that the industry will produce by 2015.

"It's just part of the new world," said John DeCicco, senior fellow for automotive issues with Environmental Defense, a nonprofit advocacy group that supports tougher fuel standards. "Fairness is in the eye of the beholder."

The National Highway Traffic Safety Administration developed the rules. The agency's plan creates two sliding scales of fuel economy targets for cars and trucks of different sizes.

Each automaker is assigned its own separate fuel-economy standards for cars and trucks, based on the number of vehicles of each footprint size that it sells.

The sliding scales aim to achieve better fuel economy in vehicles of all sizes. Under the rules, automakers that build large vehicles might find it advantageous to keep doing so. If they downsize, their standards would go up.

At the same time, industry and government officials argue that if gasoline prices remain high, consumers will demand smaller, fuel-efficient vehicles.


Small cars, big numbers
The proposed system creates anomalies. The most extreme example is Porsche Cars North America Inc. The company's powerful sports cars have short wheelbases and consequently small footprints, thus higher fuel economy targets.

If the industry builds the mix of vehicle sizes that NHTSA projects, Porsche cars would have to average 41.3 mpg in 2015--about 7 mpg better than Toyota, Lexus and Scion cars collectively. The current car standard, 27.5 mpg, has not changed since 1990.

Other automakers with smaller, less diverse product offerings--such as Volkswagen Group of America Inc., Mitsubishi, Subaru and Suzuki--also face much higher standards under the proposal.

Variations among the six largest manufacturers are less striking because of their broader product lineups. But they are still significant. For cars, Chrysler LLC's 2015 fuel economy standard would be the lowest, at 33.6 mpg. American Honda's would be highest, at 36.4 mpg.

For 2015 model trucks, GM--which generally has bigger pickups and SUVs--would have the lowest standard among the six biggest companies, at 27.4 mpg. Honda trucks would have the highest standard, at 29.6 mpg. Today, trucks must meet a fuel economy standard of 22.5 mpg.

"They are certainly aggressive" numbers, said Ed Cohen, vice president of government and industry relations for Honda North America Inc. "The truck hurdle will be the more challenging of the two."


Play or pay
The requirements that Porsche faces in 2015 help explain why the company lobbied Congress hard to give it an exemption in the energy bill. Lawmakers refused.

Some industry executives predict Porsche and several other automakers will pay hefty fines rather than change their lineups. NHTSA concedes fines would be less expensive than investing in new fuel-efficient powertrains.

The agency is seeking public comment on whether it should increase its penalties. The former DaimlerChrysler paid a fine of about $30 million for the 2006 model year because its imported cars missed the fuel standard.

Automakers generally support the new fuel standards, despite the anomalies. They say a tough national standard is preferable to state-by-state greenhouse gas regulations, which they claim would create market chaos.

Environmental advocates mostly expressed satisfaction with the proposed rules as well. An exception was Joan Claybrook, a former NHTSA chief and longtime president of the consumer group Public Citizen.

Claybrook said the rules do too little too late. The proposed sliding scales, she said, would create "an unadministrablecq mess."

NHTSA is taking public comments over the next two months. Regulators must adopt final rules by April 1, 2009. The Bush administration plans to act by the end of the year.



This article was last updated on: 04/28/08, 10:00 et



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[Mr. Wyndham]

Well...so it didn't turn out AS bad as it could have....I would suppose, that opposed to any alternative form of rules...GM is as content as it could be.

[Mindz]

I hope the most recent bill passes. CA has it head up it's A$$ and it's nose in the air trying to keep it's "green" name and is pissed because the bill means it won't allow them to keep higher emisions standards than anywhere else in the US.

[DGthe3]

so, cars will get bigger but lighter. It really sucks for porche though. there is no way they can meet 41 mpg unless they introduce some volt like cars