White House Played Hardball To Set 54.5-MPG Standards

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President Obama inspects the 2011 Chevrolet Volt

President Obama inspects the 2011 Chevrolet Volt

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Politics is hardball, as every election season shows us.

And getting very, very large and powerful auto companies to do something they really don't want to do is very, very hard.

Even, that is, if you have a few useful levers, in the form of independent California regulators supported by a Supreme Court decision and the Government-funded bailout of two of the three U.S. automakers.

So as Detroit News Washington correspondent David Shepardson recounts in a pair of articles published Friday, the Obama Administration had to play hardball to get automakers to agree to support corporate average fuel economy (CAFE) standards for 2017-2025 vehicles proposed by the U.S. Environmental Protection Agency (EPA).

And foreign automakers believe the resulting rules were skewed to give an advantage to the three domestic automakers: General Motors, Ford, and Chrysler (now part of Fiat).

That conclusion is contained in a report by the staff of the House Oversight and Government Reform Committee, chaired by Rep. Darrell Issa [R-CA].

Rep. Issa is a consistent critic of President Obama, of fuel-efficiency rules, and of government regulation in general (he invited automakers to list what regulations they wanted to kill the day the Republican-led House took office in January 2011).

Facebook post by Rep. Darrell Issa (R-CA) concerning Chevrolet Volt electric car, January 2012

Facebook post by Rep. Darrell Issa (R-CA) concerning Chevrolet Volt electric car, January 2012

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Issa is also known as the elected official who summoned General Motors CEO Dan Akerson to Washington, D.C., to testify to a committee hearing on the safety of the Chevrolet Volt extended-range electric car following a June fire in the battery pack of a Volt several days after it was wrecked in a NHTSA crash test.

You may choose to view the committee's report with those points of view in mind.

Akerson testified at that hearing that the battery pack and the Volt overall were safe, and the NHTSA strongly asserted that it "acted proportionately" in investigating the problem.

Rather than summarize the articles, we recommend that you read them in full to get a sense of the complaints from Toyota, Honda, and other non-U.S. automakers.

Shepardson's two articles (which duplicate some material) in the Detroit News Friday edition are:

U.S. Environmental Protection Agency adminstrator Lisa Jackson and President Barack Obama

U.S. Environmental Protection Agency adminstrator Lisa Jackson and President Barack Obama

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Report shows bitter fuel rules talks


White House defends fuel efficiency deal

What do you think of the resulting 54.5-mpg fuel efficiency standards that will be required by 2025? (That level translates to 40 to 45 mpg on the new-car window sticker, by the way, which is a lower rating than the one earned by today's Toyota Prius hybrid.)

Leave us your thoughts in the Comments below.


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Comments (17)
  1. Having now read both linked articles, I can understand why you didn't try to summarize them, the situation is about as clear as mud.

    The main argument seems to be that the rules were not aggressive enough on big trucks and that favored the US manufacturers. I fail to see why this is a big deal.

    So they got through a deal that was 3.5% per year improvement on trucks and 5% per year on cars. It seems far enough and a big win for everyone. Cars will be more expensive (which should be good for auto makers, more profit) and money spent on fuel will be less. We should all get out of this in a better financial position.

  2. Good points except one...wrong to always assume higher prices equal higher profits.

  3. I am not sure that I even believe prices will be higher. People may simple not get leather seats and spend money on the newly required energy efficiency gear.

    There are reasons things are "options"

  4. Darrell Issa is an idiot. He is willing to bash anything that Obama does, regardless whether it is right or wrong...

    I wish I can move to his district and get people to vote him out of office..

    Anyway, the key complain is that the Detroit trucks get exemption as "full size" trucks where Toyota complain about Tundra NOT getting the examption. Also, GM gets to offset its truck # with its hybrid pickups and Toyota NOT allowed to uses it "hybrid" car MPG to offset its trucks.

    Well, I say "if Toyota is truly committed" to green and high MPG, then leverage its Prius "synergy" technology into their Tundra/Sequoia drive trains.

    We all know all the complain is about money...

  5. Probably the best ever commment I've seen from you sir. Thank you!

  6. Big deal... 2012, 2016, 2020, 2024 - 4 chances for the measure to be altered or removed given the sourness among the parties involved.


  7. Very unlikely for these rules to removed or weakened now no matter which party takes the pres position this year. Dems n other smart folks will fight like crazy to keep them in place. The new rules will only make the US more business, fuel, and cost efficient.

  8. Having the standard is great. But I wonder if the EVs will be averaged into the mix with their high MPGe numbers...

  9. I think there is special accounting for EVs and Nat. Gas Vehicles where they are given more weight than their MPGe and sales number represent. (I'm not saying it is wrong to do so).

  10. I think the line will get fuzzy over time. If Hybrids are allowed to offset the regular ICE mpg, then why can't plug-in cars do the same? What about EREV? Where does the line stop?

  11. One of the key reasons that US fleet avg consumption is so poor is the "mis-use" of trucks as every day private runarounds. As a regular visitor to Texas I witness this every day. 50 % of the staff in the office I visit commute in a Truck.

    Trucks are a commercial vehicle and make sense if you are a plumber or a farmer regularly using the pick up bed to carry tools or bails.

    Legislation should not even be considering the MPG of trucks, it should be actively encouraging their common sense use.

    The fleet average would improve overnight if the fleet mix more accurately reflected rational common sense use.

    But when has common sense ever got in the way of consumerism.

  12. Actually the only way to change that behavoir is to tax gas into a very expensive thing..

  13. You are correct, tax or levies is the only way but rather than penalise everyone surely for the sake or argument a 2000 USD annual License fee on a truck which genuine business users can take as a 100% deduction from their tax bill would focus the mind of the "private" truck users.

    I know such a notion has a chocolate tea pot's chance of ever getting on the statutes but it does make sense.

  14. The hate of taxes and regulation is so intense, that people rather see their money flowing out of the country into the deep pockets of oil sheiks than ending up in their own government's coffers. Breathtaking short-sightedness.

  15. I am not a US citizen, but is it really true that a congressional hearing was held, just for the sake of 1 battery fire? Or am I missing something?

  16. Yes, it was real political theater. Not much was accomplished, and it looks like the federal safety administrators and GM had both worked hard to resolve the issue long before the politicians stepped it.

  17. "What do you think of the resulting 54.5-mpg fuel efficiency standards that will be required by 2025? "

    Suck it up, buttercup.

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