Car Dealers Fight Higher MPG Rules, Again, Over Affordability Page 2

By John Voelcker

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That's way out of line with estimates from Boston Consulting Group ($2,000 or less per car for a 40-percent mileage improvement using existing technology) and from Phil Gott, managing director of industry analyst IHS Automotive, who viewed the $2,000 figure as being on the high end of likely costs.

All projections suggest that consumers will save far more than $2,000 over the life of the car.

Addressing NADA's premise, though, it's well known that consumers deciding what to buy typically overweight initial purchase price ("How much car can I get for the payment I can afford?") and underweight total cost of ownership (fuel, repairs, and how long they'll own the car).

Support for higher MPG

Most comments at the public hearings held so far have supported the tougher gas-mileage standards. The Detroit News reported that the public comments at Tuesday's hearing in Detroit were widely in favor.

Those came from automaker representatives, the United Auto Workers--who view plant retooling for more fuel-efficient engines as a source of continuing employment, and perhaps new jobs--and the general public.

Even the Alliance of Auto Manufacturers hasn't offered much criticism of the proposed rules. Its president, Mitch Bainwol, confined himself to stressing the need for a "rigorous" review of the new rules' impact midway through their 9-year term.

That review, which is meant to look at whether the higher gas-mileage standards are aligned with new technologies, consumer buying patterns, and cost projections, are built into the proposed rules--one concession the agencies made to automakers' concerns.

The final hearing in the series will be held January 24 in San Francisco. The public can also submit comments on the proposed regulations until February 13.

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