Analysis: Trump's Fuel Efficiency Freeze Could Stall Industry

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Aug. 6, 2018—The U.S. federal government recently rolled out a proposal to freeze automotive fuel economy and greenhouse gas standards. And Margo Oge, a former director of the EPA’s office of transportation and air quality, says the auto industry is now at a crossroads as a result.

The current standards, known as the 2025 program, will double the fuel economy of vehicles to 51.5 miles per gallon in an effort to slash greenhouse gas emissions in half by 2025. The Trump administration’s proposal, conversely, seeks to freeze the standards at 2020 levels through 2026. In addition, the proposal also seeks to stop California from enforcing its own, stronger gas standards, as noted in a Forbes article.

Trump’s move goes much further than what the auto industry requested, Oge noted, and isn’t necessarily a positive for the entire industry. The hope in the past was that, by enforcing fuel economy standards, it would help the industry become more competitive through improved technologies, and save consumers thousands of dollars at the pump over the lifetime of a vehicle … plus save the planet the burden of billions of tons of CO2.

But, Oge contended, Trump’s proposal would put those “win-win” scenarios at risk. The freezing of standards will cost the U.S. economy an estimated $457 billion by 2050, while increasing transportation sector emissions 11 percent, to 1,432 million metric tons, by 2035.

The former EPA executive concluded that the best way to aid the auto industry is for car companies to now work with California to agree on a set of 2025 standards that, in turn, “becomes the de-facto national program.” California also has a public willingness to work with car companies, Oge said.

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