Federal fuel efficiency standards may increase new car prices

April 16, 2012 12:00 AM

The federal government and automakers have already agreed on the new Corporate Average Fuel Economy (CAFE) standards, which will mandate that automakers offer a fleetwide average of 54.5 MPGs by 2025. However, the National Automobile Dealers Association (NADA) recently speculated that the new rules could have an effect on consumers.

Raising the fuel efficiency of vehicles by 2025 will likely necessitate a $3,000 cost increase in the price of new cars - a cost that the government claims is offset by the big savings at the pump, reports The Detroit News. Yet NADA's recent study shows that 7 million customers will not be able to afford a new loan on the more expensive vehicles, making it more difficult for them to reap the benefits of the fuel efficiency.

"To work, fuel economy improvements must be affordable," said Don Chalmers, head of NADA Government Affairs and a dealer himself. "While you can mandate what automakers must build, you can't dictate what customers will buy, nor can you dictate if a bank will make a loan. If my customers can't buy what I've got to sell, there are no savings at the gas pump and there is no environmental benefit. If car and truck buyers do not purchase these new products, we all lose."

Drivers can improve fuel efficiency on their own cars by keeping up with regular auto maintenance, including new tires and tune-ups.

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