Warren Brown's Car Culture

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By Warren Brown
Sunday, May 24, 2009

The Obama administration's proposed new standards for vehicle fuel economy mark a partial victory for common sense. A complete win is more difficult. It requires a provision ensuring that American consumers will buy the more fuel-efficient vehicles that American politicians are asking car companies to make.

That provision is missing from the White House's proposals, which demand that new cars sold in the United States meet a 39-mile-per-gallon standard and that light-truck fleets average 30 miles per gallon by 2016. That would be 11.5 miles per gallon higher than the current federal standard for cars (27.5) and 6.9 miles per gallon better than the current standard for trucks (23.1).

The administration's suggested standards also would dispense with the silliness of two federal agencies (the National Highway Traffic Safety Administration and Environmental Protection Agency), and would keep the District of Columbia, California and 12 other states from making their own rules to boost the mileage and reduce the tailpipe emissions of cars and trucks sold in this country.

In that regard, the Obama Rules constitute a stroke of genius. They eliminate years of state-federal and interagency conflicts that have done much to enrich lawyers but little to increase miles per gallon or decrease pollution.

Under the Obama Rules, there will be one set of standards -- truly national standards -- cooperatively administered by NHTSA and the EPA. That makes much more sense than a hodge-podge of competing rules, developed through expensive variations in testing procedures that yield marginally different results in real-world vehicle performance.

"It is just so much better with one standard," said Friedrich Eichiner, a member of the board of Germany's BMW Group, who was in town last week for the White House's announcement of the new mileage rules. Multiple standards are costly for manufacturers and confusing for automobile dealers and their customers, Eichiner said. "One set of standards is best for everybody," he said.

BMW initially will attempt to meet the Obama Rules with its advanced diesel technology, which is at least 30 percent more fuel-efficient than traditional internal-combustion technology using gasoline.

Diesel-powered cars from BMW, Mercedes-Benz and Volkswagen -- hugely popular in Europe -- are now ready for sale in the U.S. market. Their tailpipes have been cleaned up with advanced exhaust treatment technology. They are quiet and smooth-running. But they usually are substantially more expensive than their gasoline counterparts, making them a hard sell in a U.S. market awash with the cheapest gasoline in the developed world.

"A better balance" of fuel taxes would help the sale of diesel-powered vehicles in the U.S. market, said Eichiner. But his statement was more a matter of wishful thinking than it was an assessment of practical possibility in a country whose politicians have long opposed doing anything that would require registered voters to buy into energy conservation by paying more for gasoline.

Eichiner's "better balance" would mimic the fuel-tax system widely used in Western Europe, where less-efficient gasoline consistently is taxed at a higher rate than more efficient diesel.

In the United States, the opposite is true.

Federal and state taxes make up 20 percent of the cost of gasoline and 21 percent of the cost of diesel, according to information from the Energy Information Administration. In many parts of the country -- New England and the Central Atlantic region are examples -- diesel prices routinely exceed pump prices for gasoline.


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