AP Report: Autos Request A Compromise On Fuel Economy Standards
The AP reported this week a coalition of automakers told the Biden administration it would agree to raise fuel economy standards but with tradeoffs and at rates lower than those brokered by California with five other car manufacturers.
Fuel economy rules are important to energy marketers because federal fuel efficiency standards have a direct impact on consumer demand for transportation fuels.
The Biden Administration is likely to seek an increase in fuel economy standards, however, the autos are pushing back.
The Trump Administration finalized a rollback of the standards last year to require a 1.5 percent annual increase in fuel efficiency through 2026, far below the Obama Administration’s 5 percent requirement.
The 1.5 percent improvement requirement matches auto manufacturers historic efficiency rate achieved by voluntary technological advancements.
During the Trump Administration, Ford Motor Company, BMW AG, Volkswagen AG and Honda Motor Company, reached an agreement with California on emissions standards which would increase the average fuel economy of their fleets to around 50 miles per gallon by the end of 2026.
The bottom line is that the autos would rather have a nationwide fuel economy standard rather than having a California standard that several liberal leaning states would match.
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