New Auto Fuel Economy Rules Set

Wednesday, March 29, 2006

BALTIMORE — The Bushadministration issued new rules Wednesday ratcheting up gas mileage requirements for pickup trucks, sport utility vehicles and vans, for the first time covering the largest SUVs on the road like the Hummer H2 and Chevrolet Suburban.

The new fuel economy rules, covering 2008 through 2011, would save 10.7 billion gallons of fuel over the lifetime of the vehicles sold during the period and go further than an administration proposal issued last summer,
"The new standards represent the most ambitious fuel economy goals for light trucks ever developed in the program's 27-year history," said Transportation Secretary Norman Y. Mineta.

The rules were outlined amid growing public concern about U.S. dependence on foreign sources of oil and rising pump prices. It represents the most significant changes to the Corporate Average Fuel Economy system in three decades and will affect automakers' product lineup.

Mineta's announcement, overlooking an interchange of automobiles moving along Interstate 95, follow President Bush's declaration that the U.S. is "addicted to oil." Bush has called for a 75 percent reduction in Mideast oil imports by 2025.

The new rules do not apply to passenger cars, which must meet a 27.5 mile per gallon average.

Under the CAFE system, automakers now must meet an average of 21.6 mpg for their 2006 model year light trucks. That average will rise to 22.2 mpg for 2007 vehicles.

Under the new rules, the fleetwide average would reach 24.1 mpg by 2011, a slight change from the proposal made last summer.

The rule would include SUVs weighing 8,500 to 10,000 pounds for the first time starting in 2011, but would not include large pickup trucks in the weight class. DOT officials said they would require manufacturers to install fuel saving technology on all passenger trucks.

Environmental groups have pressed for the higher standards and urged that the rules start applying to both large trucks and sport utility vehicles.
"The fact that fuel prices have increased and more importantly, fuel price forecasts have increased since the proposal was developed suggests a stronger standard is warranted," said Eric Haxthausen, an economist with Environmental Defense.

Environmentalists had also pressed for higher fuel savings, noting that it only amounted to a few weeks worth of oil consumption.

"The president is the one who said we're addicted to oil. This is his most important tool to curb that addiction," said Dan Becker, who directs the Sierra Club's global warming and energy program.

The new rule would call for specific fuel economy standards for all light trucks based on a vehicle's dimensions. Mineta said it would help close loopholes used in the past by automakers to meet fuel economy standards and level the playing field for automakers.

U.S. automakers such as General Motors Corp. (GM) and Ford Motor Co.(F) have said the current system hurts them against the competition because sales of large SUVs must be offset by the sale of smaller light trucks to comply with fuel economy rules.

Automakers have noted that the final plan will likely mean seven straight years of higher fuel economy requirements for light trucks. The industry has fought previous attempts to raise the standards but has expressed support for the proposal's direction.

Charlie Territo, a spokesman for the Alliance of Automobile Manufacturers, said the new rule "challenges automakers to increase the fuel efficiency of all vehicles, regardless of size."

The rule would include SUVs weighing 8,500 to 10,000 pounds for the first time starting in 2011

"The new rules do not apply to passenger cars, which must meet a 27.5 mile per gallon average."