Industry braces for tougher fuel economy standards

Source: Camille von Kaenel, E&E reporter • Posted: Friday, August 5, 2016

Most auto industry employees expect the Obama administration will make fuel economy rules more strict following an ongoing review, according to a new survey.

Fifty-two percent of the engineers, managers and other workers in the automotive manufacturing and supply chain industries who responded to a WardsAuto survey said they expected the government to tighten corporate average fuel economy and greenhouse gas emissions standards. Only 13 percent expected the rules to be loosened.

The agencies that set the rules, U.S. EPA, the National Highway Traffic Safety Administration and the California Air Resources Board, are evaluating their effectiveness in a midterm review. They will have to decide by April 2018 — under a new administration — whether to tighten, loosen or maintain the standards for model years 2022 to 2025.

A technical review that kicked off the process last month found that automakers would not meet a projected fuel economy target of 54.5 mpg in 2025 unless the standards were made stricter (ClimateWire, July 19). New cars have been meeting and exceeding the per-engine standards so far, but the average fuel economy of the fleet on the roads has stalled because Americans are choosing more trucks and sport utility vehicles over passenger cars. Revising the expected share of trucks sold in 2025 upward, the agencies projected automakers would only achieve an average miles-per-gallon rating of 50.8.

Automakers have argued that low gas prices and changing consumer preferences make it harder to meet the administration’s goals and have pushed for a weakening of the standards. Environmentalists have argued the standards should be tightened to cut carbon emissions further.

DuPont sponsored the new survey, which was conducted over the past two months. Nearly two-thirds of the 600 respondents named electric vehicles as the top topic of debate during the midterm review, above off-cycle technologies or the agencies’ different regulatory systems. Nearly three-quarters said the role of electrification to meet fuel economy targets has not become clearer in the last year.

Meeting the standards requires little electrification, according to the agencies’ technical review. Officials expect cars sold in 2025 to have traditional internal combustion engines.

Twelve percent of the survey respondents said their companies were most focused on plug-in EVs to meet 2025 standards. Lightweighting was the most popular strategy at 34 percent. The administration had not anticipated the technology would lead to such big increases in fuel economy when setting the rules. Administration officials, in their review, argued the emergence of lightweighting, alongside other technologies like start-stop or mild hybrids, give automakers more options to cut carbon emissions at lower costs.