Everything You Need To Know About New Fuel-Economy Standards

Everything You Need To Know About New Fuel-Economy Standards


The U.S. released its final fuel-economy standards in late August.  Fuel-economy standards are set to almost double the average mileage of cars and light trucks to 54.5 miles per gallon by 2025, according to the Wall Street Journal.

The fuel-economy standards are similar to the ones proposed require steady increases in fuel efficiency for new cars built between 2017 and 2025. Standards have already been tightened for 2012-2016 period.

The administration says the fuel-efficiency standards will save consumers money at the pump, reduce U.S. oil consumption, help the environment by curbing greenhouse gas emissions, and drive innovation in Detroit. The rules in general have garnered support from automakers, labor unions and environmentalists.

Some foreign automakers also criticized the new regulations. The regulations impose lighter restrictions on light trucks, which directly benefits General Motors Co., Ford Motor Co., and Chrysler Group LLC who all have truck-heavy product lines.

However, the initial costs of purchasing the new cars could put them out of reach for some consumers. The Obama administration says the increased cost in technology will be offset by fuel savings down the road. Opponents criticize the regulations as overreach. The regulation “choke” businesses’ ability to recover in a weak economy.

The average fuel economy of vehicles in the 2011 model year was 28.6 miles per gallon according to the Environmental Protection Agency. With the new fuel-economy regulations, the administration is seeking to nearly double the fuel economy over a space of 14 years. Estimates say the new regulations will reduce U.S. oil consumption by more than two million barrels a day by 2025 and will cut an entire year’s work of greenhouse gas emissions from our current economy.

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