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Foreign luxury carmakers could get loophole in upcoming fuel regulations

 
5 1,738 views Jul 31, 2009

The exemption would apply to companies that sell fewer than 400,000 vehicles per year in the U.S.

The exemption would apply to companies that sell fewer than 400,000 vehicles per year in the U.S.

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In May the White House unveiled a new fuel efficiency policy calling for 35.5mpg fleet averages by 2016, and almost immediately the carmakers began talking about how much it would cost them. But now it looks like the luxury carmakers in the U.S. - primarily foreign marques - could catch a break thanks to an exemption being considered by the Obama administration.

Currently the plan would put an industry-wide standard into place, but the exemption, nicknamed the 'German provision' by lobbyists, would allow carmakers that sell fewer than 400,000 vehicles in the U.S. each year to be held to a less stringent standard, report The Wall Street Journal.

Obvious beneficiaries of the exemption would be the German carmakers Porsche, BMW and Mercedes-Benz, two of the loudest opponents of the rule in the first place.

In many ways the provision makes sense, since smaller carmakers are ostensibly less able to absorb the costs necessary to improve emissions to requisite levels due to the lack of small, low-end vehicles to boost their efficiency figures. The per-unit costs of such upgrades would also be huge for a small-volume carmaker, and legislating companies out of business isn't the goal.

On the flip side, allowing these companies to continue with less strict fuel efficiency standards works against the intent of the single national framework sought by the Obama administration and also undermines the ecological benefits of more efficient vehicles.

Other carmakers that could see some benefit from the proposed exemption include Mitsubishi, Suzuki and Subaru.



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Comments (5)

  1. ma_buutylova avatar buutylova Posted: 8/1/2009 1:59pm PDT

    Thats not fair to everyone else.
     
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  2. ma_SuperSkyline89 avatar SuperSkyline89 Posted: 8/1/2009 4:11pm PDT

    World ain't fair. Frankly I'm happy to hear any news that means I still have a chance to get a V8 in the future.
     
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  3. ma_archony avatar archony Posted: 8/2/2009 8:36am PDT

    I can see this rule applying to companies like Ferrari or Morgan that sell less than 10,000 cars a year in the US. You would think that if a car company can sell close to half a million cars in the US every year they are large enough globally to afford improving their emissions.
     
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  4. ma_www.mywheelsonwalls.com avatar www.mywheelsonwalls.com Posted: 8/2/2009 10:19am PDT

    Wa Wa Wa.... life's not fair!!!! Who were you people raised by? Life has never been fair.

    Also don't forget how American politics work! Lobbyists, lobbyists, and lobbyists. Even the liberal ones drive big german sedans, just checkout Al Gores ride of choice!!!! Sure it runs on bio diesel but to sell that they (MB) need to sell V8's too.
     
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  5. ma_rongo avatar rongo Posted: 8/2/2009 2:20pm PDT

    Shows how ridiculous the CAFE standards are. How can GM, Ford & Fiasler develop competitors to these German cars when there are two sets of rules. CAFE is flat out stupid!!
     
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