Auto Industry Caves on New CAFE Standards: Consumers Will Take the Hit

Last week I wrote about the brave automakers who were taking out radio ads opposing the Obama Administration’s proposal to raise Corporate Average Fuel Economy (or CAFE) standards for new cars and light trucks to 56.2 miles per gallon by 2025.  This week I must report that thirteen automakers signed on to a 54.5 miles per gallon CAFE standard by 2025.   President Obama announced the deal on Friday.

My CEI colleague Marlo Lewis discusses this insanity here.  Rep. Ralph Hall (R-Tex.), Chairman of the House Science Committee, sent out a press release last night making the point that CEI’s Sam Kazman has made for decades: CAFE kills.  Kazman makes the point again here.

Henry Payne, cartoonist and columnist for the Detroit News, dug up the reason why the automakers have signed on:  “‘We’ll agree to anything that’s 15 years out,’ a highly-placed auto industry insider told me today about the fairy tale 54.5 mpg-by-2025 mandate….”  Payne also uncovers Detroit’s strategy.  The original 1975 CAFE standards put Detroit at a huge disadvantage to its foreign competitors.  But:

“This time, a wiser Detroit lobbying team has reacted to the feds’ 100 percent increase in fuel economy by carving out special rules for its truck-heavy lineup, devising easily-manipulated ‘foot prints’ by which each vehicle is judged, and negotiating massive federal subsidies to help automakers build the electrics that will gain the industry credits against the pie-in-the-sky standard (and that Obama has guaranteed the federal government will buy up for its own fleet).”