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Obama to announce new fuel economy standards tomorrow
Source: Agencies |
July 28, 2011, Thursday
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THE Obama administration has reached a compromise with automakers on a new fuel economy target for cars and trucks, ending months of negotiations on this pivotal mandate for the auto industry.
Automakers' fleets will now have to average 54.5 miles per gallon by 2025, according to people familiar with the plan.
US President Barack Obama will officially announce new guidelines tomorrow, the White House said.
The compromise is slightly less than the administration's original proposal for corporate average fuel economy, or CAFE, standards. But it is a major step up from current standards that require automakers to achieve 35.5 mpg by 2016.
Earlier, the administration had proposed increasing the CAFE target to 56.2 mpg between 2017 and 2025, but that plan ran into opposition from the industry and some lawmakers.
The push to boost fuel efficiency has forced automakers to redesign vehicles and use lighter but more expensive materials. These efforts are likely to raise the cost of vehicles and may pinch automakers' margins.
That has caused resistance from lawmakers in states with a heavy auto manufacturing presence, as well as the United Auto Workers union, which is concerned about jobs.
The new proposal includes average increases in fuel economy of 5 percent for cars and 3.5 percent for light trucks through 2021, with a 5 percent increase for all vehicles after that.
Automakers' fleets will now have to average 54.5 miles per gallon by 2025, according to people familiar with the plan.
US President Barack Obama will officially announce new guidelines tomorrow, the White House said.
The compromise is slightly less than the administration's original proposal for corporate average fuel economy, or CAFE, standards. But it is a major step up from current standards that require automakers to achieve 35.5 mpg by 2016.
Earlier, the administration had proposed increasing the CAFE target to 56.2 mpg between 2017 and 2025, but that plan ran into opposition from the industry and some lawmakers.
The push to boost fuel efficiency has forced automakers to redesign vehicles and use lighter but more expensive materials. These efforts are likely to raise the cost of vehicles and may pinch automakers' margins.
That has caused resistance from lawmakers in states with a heavy auto manufacturing presence, as well as the United Auto Workers union, which is concerned about jobs.
The new proposal includes average increases in fuel economy of 5 percent for cars and 3.5 percent for light trucks through 2021, with a 5 percent increase for all vehicles after that.
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