Obama Officials: 54.5 MPG Could Save You $4,400 Per Vehicle

Federal officials say their plan to require average fuel mileage of 54.5 miles per gallon for cars and light trucks by 2025 would net a consumer $3,000 to $4,400 in savings over the vehicle’s lifetime – in addition to the vital benefits the new standard would bring to the environment.
Obama administration officials also announced that the stronger fuel economy would reduce America’s dependence on oil by an estimated 12 billion barrels.
By 2025, officials say the new standard would reduce oil consumption by 2.2 million barrels per day – enough to offset almost a quarter of the current level of foreign oil imports.
But the new mileage requirement would come at a price for automakers. The added cost to meet the goal by model year 2025 would be about $2,000 per vehicle.
However, fuel savings for consumers are expected to more than offset the higher vehicle costs, as much as a net saving of $4,400 for the lifetime of a model year 2025 vehicle.
“We expect this program will not only save consumers money, it will ensure automakers have the regulatory certainty they need to make key decisions that create jobs and invest in the future,” said U.S. Transportation Secretary Ray LaHood.
As part of the administration’s new fuel mileage rule, the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Transportation (DOT) today estimated the savings for an American buyer of a vehicle meeting the new standard.
“Those consumers that buy a new vehicle with a typical 5-year loan will benefit from an average monthly cash flow savings of about $12 during the loan period, or about $140 per year, on average,” the agencies reported on the website of the National Highway Traffic Safety Administration.
“So the consumer would benefit beginning at the time of purchase, since the increased monthly fuel savings would more than offset the higher monthly payment due to the higher incremental vehicle cost,” the agencies noted in their official Notice of Proposed Rulemaking
The National Automobile Dealers Association has criticized the increased manufacturing costs of the new requirement, suggesting it could cost jobs within the industry.
“The proposed regulations present aggressive targets, and the administration must consider that technology break-throughs will be required and consumers will need to buy our most energy-efficient technologies in very large numbers to meet the goals,” Mitch Bainwol, chief executive officer of the Alliance of Automobile Manufacturers, said in a statement, according to Bloomberg.
Federal officials, however, say vehicle manufacturers already have the technology needed, with only “significant efficiency improvements” needed.  Those improvements will come in phases beginning with model year 2017 passenger cars and light trucks.

One thought on “Obama Officials: 54.5 MPG Could Save You $4,400 Per Vehicle

Leave a Reply

Your email address will not be published. Required fields are marked *