May 20, 2009

Obama Mandate Requires Higher Auto Fuel Efficiency

President Barack Obama's plan for higher efficiency standards for cars and trucks and tougher rules on their greenhouse gas emissions will require consumers to pay up to $1,300 more per new vehicle by 2016, The Associated Press reported.

The President's plan would, however, allow drivers to make up the higher cost of more fuel-efficient, cleaner vehicles by buying less gas at the pump.

The president said it would take just three years to pay off the investment and would, over the life of a vehicle, save about $2,800 though better gas mileage.

It would still require that vehicle carbon dioxide emissions be reduced by about one-third by the target date and would set requirements for the auto industry to build vehicles that average 35.5 miles per gallon.

Government regulations have never before linked emission and fuel standards.

Obama told representatives of the auto industry, environmental groups and state and federal lawmakers that the plan would benefit them all.

"The fact is, everyone wins. Consumers pay less for fuel, which means less money going overseas and more money to save or spend here at home. The economy as a whole runs more efficiently by using less oil and producing less pollution," he said.

He added that car manufacturers would also have new incentives to create the technologies and the jobs that will provide smarter ways to power vehicles.

The plan would result in savings of 1.8 billion barrels of oil over the lifetime of the vehicles sold in the next five years"”something that would equal out to removing 177 million cars from the roads over the next 6 1/2 years.

Obama said the savings in oil burned to fuel American cars, trucks and buses during that period would amount to last year's combined U.S. imports from Saudi Arabia, Venezuela, Libya and Nigeria.

However, the Environmental Protection Agency and the Transportation Department must clear the plan before it is to be proposed in the Federal Register of pending rules and regulations.

For manufacturers, the overall fleet average would have to be 35.5 mpg by 2016 under the changes, with passenger cars reaching 39 mpg and light trucks hitting 30 mpg under a system that develops standards for each vehicle class size.

But administration officials say consumers were already going to pay an extra $700 for mileage standards that had previously been approved. The President's proposal would tack on an additional $600 to the price of a vehicle, bringing the total cost to $1,300 by 2016.

Automakers and statehouses would be able to end the ongoing feud over emission standards. More stringent standards than those required by the federal government have been requested by 14 states and the District of Columbia.

The proposal would grant states the requested higher standard for emissions while also setting a single national standard sought by automakers. Automakers would also be given more time to make the changes.

President Obama hailed the deal accepted by diverse interest groups as a "harbinger of a change in the way business is done in Washington" and claimed historic progress in his bid for a "clean-energy economy".


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