UDel

This was predicted but now there is more confirmation Trump will be lowering that ridiculous 54.5 fuel economy mandate coming up in 2025 after a speech today. This is very good news for US auto enthusiasts and anyone in the US who wants a choice in the type of vehicle they want to buy instead of regulations forcing automakers to build and offer only expensive hybrids, electrics, small Prius/Leaf/Fit like cars, and unable to keep making common 6 or 8 cylinders and all but eliminating 10 or 12 cylinders from the market. There are still strict regulations in other countries but the US is a huge market and if the market favors larger cars and larger IC engines they will still offer them in the US instead of just doing mainly 3 and 4 cylinders/hybrids/electrics in the future. California may also present a problem because they set their own standards for vehicles sold in the state. These standards were supposed to be under review but the Obama administration quickly put them into effect without review the last month. The fleet avg is only 31.2 mpg in 2016, there is no way to get to a 54.5 mpg fleet avg in such a short period of time unless automakers quickly forced buyers into small hybrids/electrics with small engines by not offering larger vehicles with IC engines anymore and started quickly dropping 6 and 8 cylinders almost altogether which can't come close to reaching those numbers and would bring down avg's significantly. This would all cost automakers and buyers more money and take away many choices.

http://www.usatoday.com/story/money/...4860/YPSILANTI, Mich. -- President Trump, calling for the U.S. "to be the car capital of the world again," announced Wednesday that his administration will review the next round of tougher fuel-economy standards in a move that could lead to a rollback.If the review eventually results in the standards being lowered, automakers potentially wouldn't have to make as many cars with advanced carbon emission-cutting technology like hybrids, electrics and hydrogen fuel cells in order to hit the minimums. Though cleaner, they are more complicated to make, can be less profitable and generally carry higher prices.Trump, in an appearance at a former bomber plant near Detroit, didn't talk about environmental implications. Rather, he focused on the regulations and their impact on American manufacturing and jobs."The assault on the American auto industry is over," he told a large group gathered at the plant, now being used for testing self-driving cars. He vowed to remove regulations that "undermine American auto production or any other kind of production."Environmentalists say Trump's decision to open the review is the first step in cutting back on tougher corporate average fuel economy, or CAFE, regulations due to cover cars in the 2022 to 2025 model years.Trump told the crowd that the new standards are unrealistic."It was necessary (to resume the review) because the standards were set far into the future," Trump said. "If the standards threaten auto jobs, then common sense changes could have — and should have — been made."Trump said the Obama administration rushed its decision to review automotive regulations that become far more difficult to achieve from 2022 to 2025."Just days before my administration took office, the EPA cut short a mid-term review. Today, I am announcing that we are going to cancel that executive action. We are going to restore the originally scheduled midterm review," Trump said, confirming reports from earlier in the day.Trump's decision has been applauded by groups representing automakers, who say they need a break from the standards because lower fuel prices have altered American buying habits and because of the cost of meeting the requirements.Under the regulations, automakers are required to collectively average 54.5 miles per gallon among all the cars and trucks they sell by 2025. Regulators said in January that automakers were likely to fall short, to 51.4 mpg, because consumers aren't buying as many small cars anymore. Detroit's big three automakers — General Motors, Ford Motor and Fiat Chrysler — depend on bigger, heavier vehicles like pickups and SUVs for a disproportionate share of profits. They usually carry heftier profit margins than smaller cars.Ford Motor CEO Mark Fields presented Trump with figures from the Center for Automotive Research in January at a meeting with other auto chief executives to show 1 million auto jobs depend on revising the standards to take consumer demand into account and to align federal rules with state standards.Environmentalists, however, say lowering the standards could backfire when it comes to job creation by making the U.S. less competitive when it comes to emissions than foreign competitors. One said the Trump administration should be careful."They are risking rolling back to the bad old days," said Roland Hwang, director of energy and transportation programs for the Natural Resources Defense Council. "They are creating chaos that is going to take years to unwind."He says the review is a "first step" to a roll back.

mmarshall

As far as I'm concerned, one more feather in Trump's cap. The 54 MPG standard is ridiculous, and is perhaps the main culprit in why we are seeing tiny, Mickey-Mouse 1.4L, 1.5L, and 1.6L turbo fours in vehicles that once had large fours and N/A V6s, and why V8s are starting to disappear in luxury cars. We've already talked a great deal about this in other threads, so I won't get into the details again here.

bagwell

agreed!!!

54 MPG is unattainable unless every car sold is a Prius.

geko29

Even the current Prius isn't good enough. Its combined mpg is 52. So the AVERAGE vehicle (trucks included) in 8 years would otherwise have to be BETTER than the current, all-new for 2016 Prius.

swajames

Whether or not you agree with the politics is for another time and place but nothing drives innovation like challenging targets and more to the point efficiency and performance aren't necessarily mutually exclusive. It may well make sense to set lower targets, but there's nothing necessarily wrong in setting the bar reasonably high and challenging manufacturers to meet goals that aren't always easy to meet.

mmarshall

Well, to a large extent, we settled that with the election last November.

I think, though, many would agree that, at 54 MPG, the bar was set un-reasonably high...especially considering the type of vehicle that the public clearly wants today. I'm not saying that most people want an out-and-out gas hog, but, in general, MPG is not one of the major factors in deciding a vehicle purchase.

Sulu

Agreed. Challenges like this drive innovation.

Let me suggest that the automakers would have been able to meet this target but are now finding it more difficult because low gasoline prices have driven up the demand for larger, less fuel-efficient vehicles and driving down the demand for the most fuel-efficient vehicles like hybrids. As a result, their automakers' fleet average fuel economy has suffered. High fuel prices would help them meet these fleet average targets.

situman

Ridiculous regulations like this is one reason automakers have to go to Mexico to save on costs to offset high development costs of fuel efficient vehicles while still maintaining a profit.

mmarshall

Nope.....if Trump gets the 35% tariff he wants on American-brand vehicles sold here that are produced overseas, that won't be a practical option any more, either. Whether the tariff will apply to European/Asian-brand vehicles sold here and produced overseas is unclear at this point.

Aron9000

^ Glad Trump is stepping in on this issue. The mileage requirements pretty much meant that automakers were going to have to build more little crap box cars like the Prius, 3 cylinder Ford Fiesta and discontinue such things that still get reasonable gas mileage like the Impala, Charger, V6 Accord.

Also with nothing but under powered small cars to choose from, it would push consumers into crossovers/SUV's and pickup trucks even further(remember that crossovers/SUVs are classified as light trucks, so they don't have to meet as stringent fuel economy standards). The net effect would have been crap choice on the car side of things, so people would just buy even more crossovers/SUV's, which get worse mileage, which defeats the whole point of raising fuel economy standards to start with.

mmarshall

The next set of MPG standards, if Trump doesn't get them rolled back, DO affect light trucks and SUVs...but not to the same extent as passenger cars. That is a major change from before, when they were basically exempt.

Sulu

I do not agree. Just look at the class of vehicles being produced in Mexico. They are compact and subcompact cars, the types of cars that are not at all difficult to make fuel efficient.

If what you say is true, it would be the large -- mid-size and full-size -- cars, the cars that would be the most difficult to make fuel efficient, that would be built in Mexico. Yet, mid-size and full-size cars are built in the Michigan and Ontario, Canada, definitely not considered to be low-cost vehicle-production areas.

Aron9000

^ The main reason automakers like the produce small cars in Mexico is of course the cheaper labor costs, but Mexico has more favorable trade deals with other foreign countries than the US. So its much easier to export these cars to Europe, southeast Asia, India and other markets where small cars are more in demand. Once again, its cheaper to build these cars in Mexico than in Europe, but yet you have great trade deals with the US(which may change) and the EU, so it makes a lot of sense from a global perspective.

Gotta hand it to the Mexicans for their close to 3rd world labor rates, ability to make a quality car(cars are the most complex thing man makes in a large scale), and their government for getting great trade deals.

mmarshall

Part of what's involved with overseas plants, of course, is the cost of transporting those vehicles back to American dealerships here within our borders....whether that is by truck, train, cargo ship, or cargo planes (and sometimes a combination of these). Currently, on most of the new vehicles I review, that seems to run from $800-1000 or so per vehicle....assuming that the figures the manufacturers print on the price-stickers are credible. The relatively small vehicles you are speaking of, primarily because of their smaller size and lighter weight, are usually cheaper to ship by tonnage than something like a Chevy Tahoe/Suburban or Ford Expedition. Then, of course, on top of that, we may (?) see Trump's new tariff, which would affect everything coming from foreign plants.

Sulu

Here is an opposing view...

If fuel efficiency standards are rolled back, will history repeat itself? One analyst thinks so, saying that the last time fuel efficiency standards were rolled back, it eventually led to the bankruptcy of the Big 3 American automakers.

The argument is that the last time fuel efficiency standards were rolled back, in the mid-1980s, it made the domestic cars less competitive against cars from Europe and Japan (especially Japan), which led to the loss of market share, to the point that GM and Chrysler (and Ford to a lesser extent) could no longer compete on their home turf.

Source

I am not an economist and I know that there are as many theories about what caused the bankruptcy of the Detroit Big 3 as there are people who contribute to Car Chat, so I cannot say that I agree or disagree with this analysis. I just thought it was an interesting idea.