Foreign luxury carmakers could get loophole in upcoming fuel regulations

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.

Enlarge Photo
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.

Follow Us

People Who Read This Article Also Read

Commenting is closed for this article

Take Us With You!


© 2018 MotorAuthority. All Rights Reserved. MotorAuthority is published by Internet Brands Automotive Group. Stock photography by izmostock. Read our Cookie Policy.