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Showdown Over Fuel Efficiency

Collide-a-ScapeBy Keith KloorMay 13, 2011 5:11 PM


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It's coming. As Peter Whoriskey writes in the Washington Post:

Over the next few months, regulators are scheduled to set the next round of U.S. fuel economy standards for [automotive] manufacturers. Among the proposals under consideration is one that would lift average fuel economy under the law to as much as 62 mpg by 2025.

He lays out the crux of the battle and the opposing sides:

The preeminent issue in the debate is how much the price of cars "” gas, hybrids, plug-ins or whatever inventors come up with"” would rise if regulations dictate such standards. On one side are automakers, which warn that the highest targets could add as much as $10,000 to the price of a new car, devastating a U.S. industry that just two years ago was bailed out by the government.

And on the other side

are environmentalists, who dismiss the automakers' cost estimates as bloated and argue that the costs of investing in fuel efficiency are tiny compared with the effects of global warming and dependence on foreign oil. The proposal to raise the standard to 62 mpg, which would translate into "real world" average efficiency of about 45 mpg, is also backed by 17 U.S. senators, who last month issued a letter of support for a "maximum feasible" standard. "The cost of investing in clean car technology will be vastly outweighed by the billions saved averting the dangers of global warming," said Roland Hwang, transportation director for the Natural Resources Defense Council.

The debate, it seems, will turn on exactly what those passed-down costs to the consumer will be. Those figures are all over the map, depending on which source you choose (and the WaPo reporter offers a bunch). Towards the end of the article, he discusses some studies and surveys that suggest consumers aren't willing to pay higher up-front prices for more fuel efficient cars. UPDATE:I'll add that I found it odd that the WaPo piece doesn't mention the higher gas prices at the pumps, and how this might factor into the debate.

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