It's the combined corperate average mpg of all vehicles a car company sells.
Each vehicle is tested and rated at a certain mpg rating. This number
is NOT any of the numbers on your window sticker from the EPA. This is a number by a different agency that is actually on the pretty high side as far as fuel economy ratings go.
The other side of the equasion is how many vehicles are sold. In a company that sells, say, a million vehicles per year, a car that sells at a rate of 200,000 per year is going to have 10 times the impact on the company's CAFE rating than a vehicle in the same company that sells 20,000.
In a company like General Motors that sold 3.87 million vehicles last year, the 8,700 Corvette Z06s sold had pretty much no impact on GM's CAFE numbers, while the Impala that sold at least 250,000 models last year is going to impact GM's CAFE like a SOB.
The "Gas Guzzler Tax" is a totally different animal with nothing to do with CAFE. The "Guzzler Tax" is a tax applied to any car (trucks are exempt) that gets a combined
EPA fuel economy below 22.5 mpg combined. American made cars that fall into that void are cars like SRT8-anything from Chrysler, Vipers, the now defunct Ford GT, the Shelby GT 500 and it's mega-powered spinoffs. These vehicles get hit with the tax, yet, these vehicles also sell in such miniscule numbers that they have virturally zero impact on CAFE standards.
Light trucks and SUVs don't pay a Gas Guzzler's tax, but their fuel economy (or lack thereof) will have a humongous impact on fuel economy since that is well more than half of what US automakers sell domestically.... and hence, the panic. Trucks had their own CAFE numbers to meet, but the new regs combine both cars and trucks together when figuring out future CAFE regs.
In 2007, all vehicles sold in the US averaged just under 21 mpg (cars alone were nearly 30!). If the issue was moving only cars to 40 mpg in 12 years, that would be no problem (despite how much resistance you see). But throw trucks in the mix, and it becomes a major problem.
It's easy to blame legislators because they are a collective, faceless organization. But the real problem is that 99.9% of the public don't understand anything about automobiles more than getting in and driving... and that goes for the officials we vote for as well. This goes for
BOTH political parties and
BOTH ends of the political spectrum (only a moron would overlook that).
But the fact is that we do have an oil addiction that essentially makes us borrow money from China to pay for oil we get from places that either don't like us or are unstable and are 1 coup away from turning against us. The obvious way around CAFE that would take the pressure off of car manufacturers is a gas tax that keeps gasoline at $4 or even $5 per gallon (perhaps using the money to pay off our catostrophic debt to China and other countries that's funding us). But that idea is essentially political suicide. The only other way is through CAFE, and IMO, it's the worst choice of the necessary evils.
The hawks are for it because less imported oil increases our security (as long as oil companies get more money to make up the loss via higher prices). Treehuggers love it because they think it means less pollution. Legislatures and Congress love it because it's an easy way to appeal to their own constituents on both sides.
This was probably a $50 answer to a $1 question, so, sorry if I went on a rampage.
