Energy Policy Conservation Act (CAFE standards)

Energy Policy Conservation Act (CAFE standards)

The “Energy Policy Conservation Act,” enacted into law by Congress in 1975, added Title V, “Improving Automotive Efficiency,” to the Motor Vehicle Information and Cost Savings Act and established CAFE standards for passenger cars and light trucks. The Act was passed in response to the 1973-74 oil embargo. The near-term goal was to double new car fuel economy by model year 1985.

“Corporate Average Fuel Economy (CAFE) is the sales weighted average fuel economy, expressed in miles per gallon (mpg), of a manufacturer’s fleet of passenger cars or light trucks with a gross vehicle weight rating (GVWR) of 8,500 lbs. or less, manufactured for sale in the United States, for any given model year. Fuel economy is defined as the average mileage traveled by an automobile per gallon of gasoline (or equivalent amount of other fuel) consumed as measured in accordance with the testing and evaluation protocol set by the Environmental Protection Agency".

Commentary

smokestack and dirty air

Crying Wolf Again: Big Business Gearing up for a Fight Against Obama’s Environmental Program

May 11, 2009

Cry Wolf Quotes

We’re certainly not, and I don’t think congress should be, in the business of mandating consumer choice. If you do the math on it, the consumer will never pay for it. We obviously don’t think the CAFE standards are very well thought out.

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GM CEO and President Richard Wagoner, meeting with Washington Times editors and reporters.

I want to make very sure that we’re not putting U.S. jobs at risk over the next two years.

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Transportation Secretary Jim Burnley, The New York Times.

If we sell too many big cars in any quarter in 1978, we’ll have to hold back our product mix and we’ll have to ration or allocate cars. The law is final now, but if enough people complain when they can’t get a big car, maybe the government will revise its legislation. To meet 27.5 m.p.g. by ’85, the average weight of cars will have to be about 3,200 pounds versus 4,000 pounds now. That means every car would be a compact, subcompact, or smaller. The new law implies that we must get better fuel economy between 1980 and 1985 then between 1978 and 1980. That’s unlikely.

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Charles Heinen, Director of Emissions and Fuel Economy Certification for Chrysler, Chicago Tribune.

The conflict between government standards and market demands is increased by the rollback of petroleum prices and extension of petroleum price controls at the same time. By making gasoline cheaper, congress has encouraged consumer demand for larger cars, while at the same time imposing fuel economy standards that require stronger demand for small cars.

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Lee Iacocca, then a Ford executive, and Henry Ford II, Chicago Tribune.

Evidence

Backgrounders & Briefs

The Success of CAFE Standards

How the CAFE standard and its successes.