Wednesday, May 20, 2009

President Obama Unveils National Limit on Vehicle Emissions and Mileage

On Tuesday, May 19, 2009, President Obama scored a victory by announcing a plan requiring automakers to reduce vehicle carbon dioxide emissions by 30% and improve gasoline mileage to 35.5 miles per gallon, on average (for cars and light trucks) by 2016.

After seven years of debating whether each state should separately set their own fuel economy standard, this national standard was welcomed by automakers and various coalitions and interest groups. This is because domestic and imports alike would be required to follow the same standard -- no one automaker would have an unfair advantage.

According to Douglas Allen, associate professor of management at the University of Denver’s Daniel’s College of Business, “without these guidelines, the U.S. auto industry would come up short…the rules clarify the road forward for car companies and remove the threat that individual states would impose a patchwork of regulations governing fuel efficiency and new vehicle carbon emissions”.

As Professor Marwell would say… “FEDERALISM”!

The average price per automobile will increase by $1,300, but that will quickly be made up in fuel savings over a few short years.

Trying to do their part to help the environment may come in the form of lower profit margins for the auto industry. According to Dennis DesRosiers, president of DesRosiers Automotive Consultants Inc., “nobody makes money producing small cars in North America”. As we discussed in class on Saturday, America is a car-loving culture. We’ll just have to love cleaner, more fuel efficient vehicles! Is a plan to fix our sub-par transit system next?

http://www.wcbs880.com/topic/play_window.php?audioType=Episode&audioId=3723240 http://www.msnbc.msn.com/id/30847065
http://www.guardian.co.uk/world/2009/may/19/obama-carbon-emissions-auto-industry

Joann L.

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