For twenty years, auto fuel economy has remained flat because buyers value size and horsepower over fuel economy. Now, with the Energy bill’s onerous fuel mandates signed into law by President Bush, manufacturers will be forced – emphasis on forced – to raise the fuel economy of the cars they sell by 40 percent in just ten years.
How to do 40-in-10 when we just did zero-in-20? Auto insiders admit they don’t know.
The “new” technologies that Washington champions – hybrids and plug-in electrics – haven’t really been tested yet in the U.S. mass market. Hybrids have only sold well in fashionable cars like the Prius (Honda has even discontinued two hybrid models due to poor sales). To make a dent in fuel economy, hybrids need to sell in bigger, high-volume vehicles like SUVs (which make up 54 percent of vehicles sold) – and GM, the market leader in this respect, is only just rolling out the first 2008 SUV hybrids.
The first plug-in electric, GM’s Volt, doesn’t hit showrooms until 2010 – assuming it overcomes technological hurdles the engineers are still working on.
Without revolutionary sales gains in these two areas or $7 a gallon gas prices that have brought diesel into wide use in Europe (an approach resisted by tax-shy U.S. pols), industry spokesmen say they they’ll have to start eliminating classes of vehicles. First to go? Big SUVs like the Ford Expedition or Chevy Suburban.
As with all backdoor mandates, the question is whether the public will notice.