News from Notch Consulting, Inc.

December 21, 2011

New CAFE standards in US may lead to larger vehicles

Filed under: General — Notch @ 4:54 pm

Proving the law of unintended consequences comes this story from Tire Business:

Proposed changes to corporate average fuel economy (CAFE) standards may cause vehicles to get bigger instead of smaller by the 2014 model year, a study by the University of Michigan says.

Researchers said “a loophole” exists in the new formula for calculating miles per gallon. Should auto makers choose to act upon that incentive, it would be more difficult to achieve the policy’s goal of reducing fuel consumption.

[snip]

The U-M study used more than 450 vehicle makes and models to figure how auto makers could modify vehicle dimensions, implement fuel-saving technology features and trade off acceleration performance and fuel economy.

“It’s cheaper to make large vehicles, and meeting fuel-economy standards costs [manufacturers] money in implementing and looking at what consumers will purchase,” said Katie Whitefoot, another researcher involved with the study.

This is by no means a new phenomenon. As readers perhaps are aware, the development of the SUV actually can be traced back to CAFE standards; since light trucks were exempt from the standards, automakers began to build passenger vehicles on truck frames.

“Rollover” traces the origins of the SUV to U.S. automakers’ efforts to circumvent CAFE (Corporate Average Fuel Economy), the stringent fuel-economy laws of the 1970s that contributed to Detroit’s painful decline during that decade. Since light trucks were exempt from the tough new standards, U.S. automakers exploited the loophole and put passenger-car bodies on truck frames. Thus was born the SUV.

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