Fuel Economy Rollback
The EPA has decided to revise the Corporate Average Fuel Economy (CAFE) standards for light duty cars and trucks, effectively putting an end to the lofty fuel economy and tailpipe emissions goals set by the Obama Administration. Donald Trump appointee EPA administrator Scott Pruitt said this week that the goals for model years 2022-2025 are unrealistic and with potentially prohibited costs to consumers. The Obama target for 2025, agreed upon by automakers, was 54.5 MPG. In reality, that translates into a combined city and highway fuel economy rating of about 36 MPG as it would appear on a new car window sticker. It should be noted that higher CAFE standards through the 2021 model year are unchanged. Further, at this point, the standards beyond 2021 have not been eliminated, but rather might be delayed as the EPA could issue a longer time table for implementation. EPAs’ Pruitt said that the Mid-term Evaluation review of the standards for practicality was eliminated during the waning days of the last administration for political reasons. While conservationists are universally protesting the move, automakers are by and large celebrating. The move also signals the end of an agreement between the federal government and California, which has the right to set its own standards, for a single national goal. In fact, Pruitt signaled that the administration may try and revoke California’s right, and that of the other states that follow their law, to go its own way on fuel economy in the future. No doubt the entire process will wind up in court. For the consumer, it means some large displacement V8 engine choices may survive a little longer, at least until gas prices rise to the high levels that partially prompted the Obama conservation efforts in the first place. While the move is, at least on the surface, welcomed by car companies, it does not change the fact that the trend to smaller engines and electrification will continue as other countries around the globe continue to push for the marginalization of fossil fuel power cars and trucks. Thus, impact on future product and powertrain development may be marginal, or at worst, also put on a longer timeframe for implementation. In perspective, the original post oil embargo CAFE standards that were supposed to be implemented by the 1985 model year, were also delayed due to political posturing and changes in administrations.