According to Fiat Chrysler Automobiles Vice President of Global Product Marketing Steve Bartoli, the U.S. automotive market is very different from how it was in 2012 – when the Obama administration set new, incrementally rising Corporate Average Fuel Economy (CAFE) requirements covering future model years. Shifts in consumer preference from small cars to trucks and utility vehicles, along with cheaper gasoline prices, have made it difficult to meet the Obama administration’s regulations, the FCA Vice President says.
And, he says that since 2016, U.S. automakers have been unable to meet rising CAFE standards without resorting to using credits earned from previous model years – something that ought to serve as “a wake-up call that assumptions made seven years ago about the U.S. auto market need to be revisited.”
“In business and in government, we… must be nimble enough to adjust our plans when the facts on the ground change,” FCA’s VP of Global Product Marketing said last month, on the second day of a three-day public hearing on the Trump administration’s proposal to freeze fuel-economy standards after 2020.
The Obama administration’s fuel-economy regulations mandated that each automaker reach a Corporate Average Fuel Economy rating of around 54.5 miles per gallon by 2025 with their U.S.-market light passenger vehicles. If that target sounds unreasonably high, it’s partly because the NHTSA uses an old, optimistic means of measuring vehicle fuel economy; the EPA label for a “54-mpg” vehicle as measured by the NHTSA might read closer to 42 mpg.
Also worth noting is that CAFE regulations take vehicle size and type into account, mandating a lower CAFE rating for automakers that sell a greater mix of large cars and trucks.
The administration of U.S. President Donald Trump has proposed freezing CAFE regulations at their 2020 levels, and stripping the California Air Resources Board of its authority to set its own, separate fuel-economy requirements. But an organization called Securing America’s Future Energy last month instead suggested a compromise that would increase requirements by 2 percent or more annually through 2026, granting EV credits and self-driving-car incentives.