The Environmental Protection Agency has proposed freezing the ever-rising Corporate Average Fuel Economy (CAFE) standards at the current benchmark of 37 miles per gallon — suspending the increase to 51 miles that had been scheduled for 2025. This, like the Administration’s recent repeal of George W. Bush-era light bulb regulations, is a good thing for consumers. Ultimately, if ultra-fuel-efficient-vehicles or low-energy light bulbs are winners in the marketplace, they should do just fine without requiring the federal government to mandate them.
In the case of vehicles, the market is clearly signaling that small cars are becoming less popular while SUV’s and trucks are growing in market share and have been for some time. Only an unforeseen oil price shock is likely to save cars.
CAFE standards are a deeply-flawed way of improving fuel efficiency. They were developed during the Ford Administration to spur fuel efficiency at a time of gas scarcity. And, CAFE standards are less stringent for trucks and SUVs, some manufacturers may choose to make and sell more higher-emitting vehicles to avoid the harsher standards for smaller cars.
The Heritage Foundation estimates that CAFE standards raise car prices by $3,800 on average.
If fuel efficiency is an important feature to vehicle buyers, they have plenty of hybrid and electrical options and that is great. What shouldn’t happen is that the federal government forces manufacturers to produce and consumers to purchase products based on outdated and ill-conceived regulations.