Auto Dealers: CAFE Rules Need Scrutiny
By Bill Visnic November 1, 2011Auto dealers are beginning to turn up the heat in the conversation about the Obama administration’s proposed Corporate Average Fuel Economy (CAFE) standards to cover the 2017-2025 timeframe, joining a widening chorus of opposition that claims the eventual 54.4 miles per gallon standard will pressure already strapped consumers, pressure the auto industry’s recovery and restrict vehicle choice in the market. A recent report by the Reuters news service said after a recent meeting with the National Automobile Dealers Association (NADA) in Washington, DC, many individual NADA members increased their support of efforts to have the fuel rules reexamined and potentially reduced.
A spending bill in the U.S. House of Representatives that has language seeking to remove the Environmental Protection Agency (EPA) from having a say in CAFE standards reportedly has the backing of most auto dealers. The bill also presses to remove California’s environmental regulatory agencies from having influence and promotes a return to having the U.S. Department of Transportation (DOT) as the sole designator of fuel-economy standards. There has yet to be similar legislation introduced in the Democrat-controlled Senate.
Edmunds.com CEO Jeremy Anwyl recently testified to Congress that consumers effectively have been frozen out of the conversation, while many say meager sales of hybrid-electric and fully electric vehicles in the U.S. – currently accounting for about 2.5 percent of all new-vehicle sales – are proof that high fuel economy is not one of consumers’ chief concerns. Obama administration officials and proponents of the proposed 2017-25 CAFE standards point to approval of the standards by most major automakers, but some speculate such approval has been won, at least in some part, because the political aspects of the fuel-economy rules have been heightened in recent years. General Motors Co. and the Chrysler Group LLC, critics argue, could be little expected to oppose President Obama’s CAFE rules after it was his administration that assured the companies’ survival before and after their bankruptcies.
Reuters reported that if the potentially CAFE-depowering legislation is not taken up in Congress, “Dealers are also weighing a lawsuit if legislative efforts tied to a spending bill in the Republican-controlled House of Representatives fail.” For now, however, the NADA reportedly plans to focus on passage for the House bill. Scores of members of the house support the bill, which would limit the EPA’s ability to influence the process for creating new fuel-economy standards.
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