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 The disconnect between consumer demand for larger, less efficient
vehicles and the Obama administration’s climate goals
sets up a clash between the auto industry and federal regulators.
Mark Rosekind, who heads the National Highway Traffic Safety
Administration, said in a Reuters interview last week the
administration will consider automakers' arguments that the shift
away from cars makes it harder to hit the 2025 fleet average fuel
economy target of 54.5 miles (87.7 km) per gallon.
But the landmark agreement announced in France over the weekend, to
transform the world's fossil fuel-driven economy
in bid to arrest global warming, could make a cut in the target
difficult for the U.S. government to accept.
"Unfortunately there have been too many decisions that are made -
'Oh, prices went down, it's OK again,'" said Rosekind. said. "No,
it's not."
Consumers are responding to signals from gas pumps, where a
combination of relatively low taxes - federal gasoline taxes have
not gone up since 1993 - and oil unleashed by hydraulic fracturing
or fracking have pushed U.S. gasoline prices to an average of just
over $2 a gallon - the lowest level in six years.
In November, fuel efficiency of vehicles purchased fell sharply to
25 mpg - down 0.8 mpg from a peak in August 2014, said University of
Michigan researcher Michael Sivak, who tracks fuel efficiency.
Nearly 59 percent of U.S. vehicle sales this year have been of
sport-utility vehicles, pickup trucks or other larger vehicles, up
from 54 percent last year, according to industry consultant Autodata
Corp.
Toyota Motor Corp says within two years its RAV4 SUV will displace
the Camry mid-size car as its top-selling model in the United
States.
Wednesday's report from the Environmental Protection Agency is
likely to show that trucks are becoming more efficient, but those
gains are largely being offset by the shift in some buyers from cars
to trucks.
Automotive fuel efficiency rules are a cornerstone of President
Barack Obama's climate policy. The administration has said better
fuel efficiency will cut 6 billion metric tons of greenhouse gases
over the lifetime of the vehicles sold between 2012 and 2025. That
is more than the total amount of carbon dioxide emitted by the U.S.
economy in 2010, the administration has said.
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The fuel economy rules for 2017-2025 will cost the industry $157.3
billion, according to Obama administration estimates, but would save
consumers as much as $488 billion at the pump assuming gas prices
average $3.53.
However, those goals are at risk. Federal regulators and California
are working on a report, due in mid-2016, that will set the terms of
bargaining with automakers over whether efficiency standards for a
final 2022-2025 period should be eased, stay the same or made
tougher.
Automakers have met with regulators in recent months for day-long
individual meetings to talk about their confidential future product
portfolios and discussed how they plan to comply with the fuel
efficiency increases.
"There is a huge gap looming between government projections and
consumer purchases of highly fuel-efficient vehicles," said
Gloria Bergquist, a spokeswoman for the Alliance of Automobile
Manufacturers - the trade association representing major automakers.
The industry group is pushing proposals to allow automakers to get
greenhouse emissions credits for adding technologies that could help
avert crashes.
Environmentalists say automakers are not doing enough to cut
greenhouse gas emissions.
"They are driving up oil consumption and pollution and putting at
risk U.S. compliance with the Paris global warming agreement," said
Daniel Becker, director of the Safe Climate Campaign.
Renault-Nissan Chief Executive Carlos Ghosn said he is not betting
on relief. "I’m not expecting it to become easier," he said earlier
this year.
(Writing by David Sherpardson; Editing by Joseph White and Tom
Brown)
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