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Gas-Mileage rules are called too lax and too stringent. (http://online.wsj.com/article/SB121729112585291671.html?mod=AutosChannelMain_RelatedStories)

http://www.cleanmpg.com/photos/data/508/2010_prius.jpgStephen Power - WSJ - July 29, 2008

Rendering of a 2009 Toyota Prius-III -- Beautiful, in demand, profitable and very fuel efficient.

The books are cooked including average fuel costs and CAFÉ’ standards while automakers argue the increases will cause plant closings and job losses… And the US’ current non-fuel efficient lineup is doing what to plants and thousands of workers??? -- Ed.

WASHINGTON -- A Bush administration proposal to boost fuel efficiency of automobiles to 31.5 miles per gallon by 2015 is raising hackles on two sides: from car makers, who say it is too tough, and from some Democrats, who say it isn't tough enough.

At issue is how to implement a landmark law passed last year that requires the Department of Transportation to raise fuel-economy standards for cars and light trucks to a fleetwide average of 35 mpg by 2020. The law gives the Department of Transportation authority to set interim standards.

The department's proposal for 2015 is a 25% increase from the present and amounts to the fastest leap in the 33-year history of the federal automobile-fuel-economy program. Administration officials say the proposal would cost the industry roughly $46 billion -- among the most expensive federal rules ever -- and save drivers more than $100 billion in fuel costs over the lifetime of the vehicles covered by the rule… http://online.wsj.com/article/SB121729112585291671.html?mod=AutosChannelMain_RelatedStories

Toyota Motor Corp. says the proposed fuel-economy increases come "at a rate much greater than anticipated" by last year's law.

That's a very disappointing statement from Toyota. I don't see Honda complaining. My next car purchase will likely be a Honda.

It's a given that the Big (Neanderthal) Three would cry like babies with diaper rash, and that's what they're doing.

Spock from Star Trek would find Ford's lament about not having resources to make the changes illogical, since Government requirements or not, Ford must make more fuel efficient vehicles or go out of business, and their current sales figures and massive losses are proof of that.

Harry

Administration officials say the proposal would cost the industry roughly $46 billion -- among the most expensive federal rules ever -- and save drivers more than $100 billion in fuel costs over the lifetime of the vehicles covered by the rule...
General Motors Corp. says the department's proposal could result in plant closings and job losses. Even as GM has promoted its Chevy Volt electric concept car.

Fuel efficiency would cost the auto industry money and that's cost they're simply unable to bear. Oh well better foist that cost on the consumer instead through lower fuel mileage vehicles. It's not like they're suffering from gas prices.

It's also a bit much to suggest that mandatory CAFE increases will lead to more layoffs when GM is, well, laying off people left and right at their big truck and SUV plants due to a collapsing market caused by high gasoline prices and not high CAFE standards. Or maybe, perhaps, I missed something and the government made them build and market those FSPs.

It seems to me that whoever can get off their butts and actually produce efficient vehicles will have the market handed to them on a silver platter. Sales are terrible, especially in the ginormous-vehicle sector. Sales in the compact sector are overtaking the bigger ones. Hmmm... let's see...

HOW ABOUT BUILDING MORE OF THOSE SMALL CARS THAT ARE SELLING!!!!!!!

It's not that complicated! 2 birds with one stone.

I don't see Honda complaining.

Scenes I'd like to see: Executives from major car companies testifying before Congress on why it's impossible to meet a 31.5 mpg standard by 2015. Honda exec is called last, and says "You think 31.5 mpg is impossible? We were doing it in 2002."

I've always argued that Toyota's motives are two fold:
Sustain the FSP market till Yota can dominate (look at Tundra and Sequoia)
Once the switch is inevitable fall back to the rich FE line already ready for market.
Toyota is just arguing for more rope for GM to hang themselves with. Not a bad move from a business viewpoint, but ethically, it would be much better to go with high FE fast. Hopefully this charade will end soon and the shift will be inevitable .

11011011

that was a disappointing statement from a consumer's perspective looking at toyota. Honda seems to have the cat in the bag while the big three it seems are trying to grapple with what little strength they have in the auto industry.

I think GM believes the price of gas will drop significantly (hence the projected sub $3 gas costs). They want to hold on to that because if gas goes to sub 3 then people will purchase the gas hogs.

we'll see how it pans out, but...the automakers really make it seem a lot harder than it is.

I really don't see how this 30mpg target would be difficult. Most vehicles could get by on 100 less horsepower than they have nowadays (I mean American manufacturers). If they all have to do it, then the competition is leveled. What's the downside? They are saying it would cost jobs... Research and new production COSTS jobs? sure whatever...

It seems like market trends will drive a push to higher FE more agressively than federal regulations could. The big three have their lobbies, but as FSPs become less and less profitable they will keep their eyes on the bottom line.

"projection that gasoline prices will range from $2.42 a gallon in 2016 to $2.51 a gallon in 2030."

For some reason when I read this I hear the song lyrics "to dream the impossible dream" running through my head. If demand and limited supply is the major reason for our current prices what in blazes is going to drive it down over $1.00 per gallon 22 years from now?

If you ask me what the government has done is too little, too late. They should have started this YEARS ago.

I would rather the government not raise the cafe standards and not give our money to the big 3 to waste on "research" into fuel efficient vehicles. People WANT more efficient vehicles because gas prices are doing the same thing as raising cafe standards would have done. Raising cafe standards would have been helpful last century, this century a recession/depression and sky high fuel costs are what matter. Let the big 3 produce more FSPs and let them die, and hopefully Aptera and companies like it will rise to take their place.

Cost industry $46 billion

Save consumers $100 billion

Said automakers who satisfy standards reap benefits.

I would rather the government not raise the cafe standards and not give our money to the big 3 to waste on "research" into fuel efficient vehicles. People WANT more efficient vehicles because gas prices are doing the same thing as raising cafe standards would have done. Raising cafe standards would have been helpful last century, this century a recession/depression and sky high fuel costs are what matter. Let the big 3 produce more FSPs and let them die, and hopefully Aptera and companies like it will rise to take their place.Here's a simple solution. Take that 2.5 billion slated for loans to the big three and instead offer it up as an "Efficient Auto Import Government Grant". Basically let US car buyers import those nice EU models for "free". Big three still gets the money (although through EU regions) consumers still get good cars, and no one has to do actual work.

I'll add it to my list of "If Dan was King of the World"

11011011

Fuel efficiency would cost the auto industry money and that's cost they're simply unable to bear. Oh well better foist that cost on the consumer instead through lower fuel mileage vehicles. It's not like they're suffering from gas prices.

It's also a bit much to suggest that mandatory CAFE increases will lead to more layoffs when GM is, well, laying off people left and right at their big truck and SUV plants due to a collapsing market caused by high gasoline prices and not high CAFE standards. Or maybe, perhaps, I missed something and the government made them build and market those FSPs.

Don't forget that the Big 3 did so well with recent profits without any increase to mileage standards.

Oh...wait...
http://www.autoblog.com/2008/02/12/gm-announces-2007-loss-and-new-buyouts-for-entire-union-workforc/
http://money.cnn.com/2005/10/17/news/fortune500/gm_loss/index.htm
http://www.msnbc.msn.com/id/16804725/
http://www.detnews.com/apps/pbcs.dll/article?AID=/20071206/AUTO01/712060342

It seems like market trends will drive a push to higher FE more agressively than federal regulations could. The big three have their lobbies, but as FSPs become less and less profitable they will keep their eyes on the bottom line.

I agree, but I wouldn't downplay the importance of meaningful, long-term standards. Especially if gas/oil prices drop in the short term, higher standards (raising the floor, if you will), prevents the floor from dropping out, and it shows that efficiency is a desirable goal. If the recent past has taught us anything, it's that gas and oil prices can get high quickly and stay high, and higher mileage helps to soften that blow.

Hi Dan:

___That would be a great idea! Unfortunately, starting about 5 years ago we trashed our $USD with the outflow of petrol $’s :( A B-Class sized super diesel Sub out of Europe cost almost $25K. European Prius’ are > $35K :ccry: I just read today that GM is selling the US built Corvette at double what they sell it for here due to the smashed $ even thought they make it for the same price here in the US.

___What gets me is Ford will sell a stripped 4,500 # plus F-150 for $14K here after > $10K in rebates in the US and cannot figure out that people are paying 10K + more for an under 3,000 # Prius?

___Good Luck

___Wayne

If you stop and think about it the fault does not lie with either the government or with the big 3 automakers. The fault, for the most part, lies with the American consumer who has demanded large, gas guzzleing vehicles. Most Americans love their powerful vehicles. If they can't get somewhere fast then they will get there in fast increments racing from traffic light to traffic light and then waiting with their engines idling until the light turns green again and then they race to the next one. When the government is faced with a bunch of voting idiots who love their freedom to waste gas and the big 3 has reacted to the public's demand for big SUVs is it any wonder that we now have $4.00 per gallon gas?

I've always argued that Toyota's motives are two fold:
Sustain the FSP market till Yota can dominate (look at Tundra and Sequoia)
Once the switch is inevitable fall back to the rich FE line already ready for market.
Toyota is just arguing for more rope for GM to hang themselves with. Not a bad move from a business viewpoint, but ethically, it would be much better to go with high FE fast. Hopefully this charade will end soon and the shift will be enviable.

11011011

I think you are right, Dan. Toyota seems almost to be sympathizing with the big 1/333 when they say "the proposed fuel-economy increases come at a rate much greater than anticipated. " Of course they can say that with a smile. They are making mucho money selling fuel efficient cars. They have not spent their time keeping European high MPG cars out of America. They have not squandered their resources selling us on the advantages of owning Yukon Hybrids.

Toyota and Honda are not in the same boat as the big .003. But they do have a few common wants and desires. Although they both have high MPG cars to sell, they both also provide pick ups and trucks to the world. In many foreign countries you see Toyota's much more often than you see Chevy's here. I saw Toyota's in Guatemala as thick as flies and some of them were very very old. Unfortunately for the big .0003, now that gasoline is fueling a stampede toward high MPG cars, they have found themselves with nothing to offer.

Toyota and Honda were not blessed with such stupid management and so they will probably reap the rewards the big 1/3 would have had if they were paying attention. :)

If you stop and think about it the fault does not lie with either the government or with the big 3 automakers. The fault, for the most part, lies with the American consumer who has demanded large, gas guzzleing vehicles. Most Americans love their powerful vehicles. If they can't get somewhere fast then they will get there in fast increments racing from traffic light to traffic light and then waiting with their engines idling until the light turns green again and then they race to the next one. When the government is faced with a bunch of voting idiots who love their freedom to waste gas and the big 3 has reacted to the public's demand for big SUVs is it any wonder that we now have $4.00 per gallon gas?

Hush now, don't be talking like that, we all know it's big oil and the automakers buying the government.;)

They banned cigarette advertising, now it's time to ban car advertising beyond stating the EPA ratings.:eek:

If you stop and think about it the fault does not lie with either the government or with the big 3 automakers. The fault, for the most part, lies with the American consumer who has demanded large, gas guzzleing vehicles. Most Americans love their powerful vehicles. If they can't get somewhere fast then they will get there in fast increments racing from traffic light to traffic light and then waiting with their engines idling until the light turns green again and then they race to the next one. When the government is faced with a bunch of voting idiots who love their freedom to waste gas and the big 3 has reacted to the public's demand for big SUVs is it any wonder that we now have $4.00 per gallon gas?

I disagree. We were all set to follow a European style automarket, until Reagan opened the flood gates for cheap oil and protected the big 3.

Marketing goes a long way for American consumers.

nf

If the big 3 did not market the gas guzzlers the way they do...this could have been avoided. All the money went to advertising and none to efficiency

[QUOTE=jamtee;129351]"projection that gasoline prices will range from $2.42 a gallon in 2016 to $2.51 a gallon in 2030."

I think there's a typo in that sentence. You need to shift the decimal points one space to the right: "...gasoline prices will range from $24.20 a gallon in 2016 to $25.10 a gallon in 2030."

Interesting article in Business Week recently, arguing for a $90/bbl floor on oil prices.

Jstol3 makes a good point about consumers. And it may be more true in CA than in some other parts of the country. People here are driving their retirement money to work. They get 15 year 2nd TD's to pay for a $50K car that might last 8 years. Duh, what's wrong with this picture? A car is first and foremost a machine. A machine that allows its driver to get from point A to point B. Realistically, all of the above players, in my opinion, must take some blame.

But now, it's far too late to worry about blame. The Big 2.X simply must knuckle down and get some FE cars rolling out the door; pronto, and like now. If they do that first, then worry about how to make money on them, then market dynamics will take over and they will be rolling in money. Right now, they are hemoragghing money out of every orifice.

As for CAFE, it seems to me that it's too open for manipulation. And, while Detroit is focusing on CAFE, they really would be better off to just say yes and get to work. A better scheme, especially given CA's budget crisis, would be to raise federal and state fuel taxes first as a temporary measure and later as a permanent measure. People will hound the Big 2.X to make the best, most FE cars in the world. BTW, after WWII, 2 Americans, Walter Deming and Joseph Juran, taught the Japanese how to make really good cars and penetrate the American market. Their secret? The PDCA cycle.

Toyota has probably done the best job of managing the market dynamics while staying positioned to be able to 'sell' in every market segment. Honda, as I recall, even reported increased sales this past quarter, probably because of their model offerings.

Now, do I want to higher taxes? Not even. But it would work, it works in Europe, and it would eliminate all the bickering and politiking over CAFE. And for the rich, it doesn't matter what they drive or what gas costs. Everyone else would just adjust to a new market. I made my adjustment last year by getting a bus pass and riding it every day. Hopefully, my cutting back on fuel consumption helped reduce demand, and thus price, for gasoline.

Faithful and True

JPeople here are driving their retirement money to work. They get 15 year 2nd TD's to pay for a $50K car that might last 8 years.

I don't understand it either. Seems that people are determined to live up to their income, if not well beyond. Not just cars, but houses, consumer goods, expensive vacations... I admit to having an above-average income these days, but I still manage to live quite comfortably while spending less than half of it.

Now, do I want to higher taxes? Not even. But it would work, it works in Europe, and it would eliminate all the bickering and politiking over CAFE. And for the rich, it doesn't matter what they drive or what gas costs.

I like what British Columbia is doing with their new fuel tax. They rebate a portion of it to the taxpayers, dividing it equally. So if you manage to use less than the average, you get back more than you actually paid, which is a pretty good incentive to figure out how to reduce your consumption.

Actually, BC Canada, as noted by jamesqf above, has a capital idea. Basically, it's a wealth redistribution scheme but one in which you can partcipate, or manipulate, to your own benefit. Thus, the rich will help support the poor while people try to reduce their costs.

Our federal and state gov'ts should hear about this idea right away.

Faithful and True

Basically, it's a wealth redistribution scheme...

Yeah, but since it would redistribute wealth from those too stupid to figure out how to cut their energy use to me... :-)

If you stop and think about it the fault does not lie with either the government or with the big 3 automakers. The fault, for the most part, lies with the American consumer who has demanded large, gas guzzleing vehicles. Most Americans love their powerful vehicles. If they can't get somewhere fast then they will get there in fast increments racing from traffic light to traffic light and then waiting with their engines idling until the light turns green again and then they race to the next one. When the government is faced with a bunch of voting idiots who love their freedom to waste gas and the big 3 has reacted to the public's demand for big SUVs is it any wonder that we now have $4.00 per gallon gas?

I'll have to disagree with you on that point. Undoubtedly consumers hold some share of the blame for eating the crap fed to them, but who was feeding them that crap? More importantly, who marketed gas guzzlers as desirable and manly luxury items, and who ultimately manufactured a very poor fleet, FE-wise? The majority share, I contend, lies with automakers.

How exactly can consumers buy what isn't being made, and how can consumers demand what producers seem very keen on not making?