GM Inside News Forum banner
1 - 20 of 112 Posts

·
Registered
Joined
·
6,455 Posts
Discussion Starter · #1 · (Edited)
From the Detroit News [EDIT] today..

http://www.detnews.com/apps/pbcs.dll/article?AID=/20080422/AUTO01/804220375/1148

The overall fleet of new passenger cars and light trucks will have to average 31.8 mpg by 2015 -- an annual increase of 4.6 percent per year and above the 4 percent figure Congress required. That compares to the fleet's overall average of 26.7 mpg in the 2007 model year
The Bush administration is under pressure to show it is taking action to address soaring oil prices, which spiked to a record $117.48 a barrel Monday. The Energy Department said gas prices hit a new record national average Monday of $3.51 a gallon, up 12 cents over the last week.
From the original source of this initiative. His branch is going farther, faster than even Congress stipulated.

Automakers have said they will take different steps to meet the new requirements. General Motors Corp. has said it will have to build many more hybrid vehicles and by 2020 will add $6,000 to the price of a vehicle.

Ford Motor Co. said in its annual report it "plans to increase the fuel economy of its vehicles through the deployment of various fuel-saving technologies, some of which have been announced publicly, and through a shift in its fleet mix toward smaller and lighter vehicles."

NHTSA estimated in December 2006 that a 40 percent increase in fuel economy requirements could cost the industry $114 billion over 10 years, including $85 billion for the Big Three.

The proposal will add nearly $1,000 to the price of building light trucks and hundreds of dollars to the average cost of new passenger cars, people briefed on the program said.
Here's where the bargaining begins. The NHTSA proposes the extra cost to be about $1000 per vehicle or less. GM mentioned previously that the cost would be $6000 per vehicle. A semi-permanent tax credit program to mitigate the extra cost is brewing...subject to negotiation.

BTW GM's estimate is very very slick. It may very well cost GM $6000 to build the new technology into the vehicles of 2020 but of that $6000 estimate, $2500 is just normal inflationary increases of all materials and costs at the rate of 1.5% annually. If an typical vehicle 'costs' $15000 to build, store, transport to a dealer today, that 2020 vehicle will 'cost' ~$17500 to get to a dealer's showroom...without any additional mandated equipment.
 

·
Registered
Joined
·
1,913 Posts
From the Article said:
NHTSA estimated in December 2006 that a 40 percent increase in fuel economy requirements could cost the industry $114 billion over 10 years, including $85 billion for the Big Three.
To continue this thought.... Obviously the estimated $85 billion hit to the big three will be funneled into the MSRP of vehicles. That's right, you me, and you over there will pay the tab. We are on the verge of spending ourselves to oblivion.
 

·
Registered
Joined
·
991 Posts
The Bush administration is under pressure to show it is taking action to address soaring oil prices, which spiked to a record $117.48 a barrel Monday. The Energy Department said gas prices hit a new record national average Monday of $3.51 a gallon, up 12 cents over the last week.
Here's a thought: maybe they could bring the value of the dollar back out of the cellar by reducing some of the crushing national debt we have, and actually run the government within the means of the tax dollars. I guess I should cc this to congress as well.
 

·
Registered
Joined
·
1,039 Posts
From the Detroit Press today..
The Bush administration is under pressure to show it is taking action to address soaring oil prices, which spiked to a record $117.48 a barrel Monday. The Energy Department said gas prices hit a new record national average Monday of $3.51 a gallon, up 12 cents over the last week.
This is ridiculous! Instead of trying to solve the problem of OPEC SCREWING US, he pushes the blame onto the automakers??? Granted no system is perfect, but are ALL of our politicians this dense?? It's not the automakers' fault oil prices are this high!!
 

·
Registered
Joined
·
8,861 Posts
Interesting that your post juxtaposes quotes about increased fuel economy to rising energy costs, PhishPhood. There's a link between the two: rising energy costs will absolutely change consumer behavior, and average fleet economy will rise commensurately. No one will convince me that people who buy Tahoe's will not do less buying when gasoline is rising by leaps and bounds each week. There's a point when consumers will move fuel economy up on the list of important attributes of a vehicle purchase, and gas guzzlers will rightfully suffer.

I agree with PhishPhood that GM's estimate is very slick. I suspected that Lutz's opining about the crushing blow that CAFE would have on the corporation in part included a hefty portion of inflation that would have occurred anyway. While I agree with Lutz essentially that CAFE is not helpful, it's not helpful to pad that impact by including factors that would have inflated the price of vehicles, anyway.

Here's a thought: maybe they could bring the value of the dollar back out of the cellar by reducing some of the crushing national debt we have, and actually run the government within the means of the tax dollars. I guess I should cc this to congress as well.
Good point. It's absolutely pathetic that 20% of our federal tax dollars goes to interest on our debt: 10% to military debt, 10% to non-military debt. That's more than $500 billion(!) to friendly folks from Asia and the Middle East to whom we are beholden. Absolutely embarassing. And the dopes who propose a whole variety of tax breaks cannot see that those breaks must be paid for sooner or later. And that means higher taxes. I sure would appreciate it if the government would do what so many Americans already have to do: spend within their means.
 

·
Registered
Joined
·
452 Posts
Here's a thought: maybe they could bring the value of the dollar back out of the cellar by reducing some of the crushing national debt we have, and actually run the government within the means of the tax dollars. I guess I should cc this to congress as well.
But if they did that China and Japan couldn't fight over who can buy up our debt and silently take over the US first. :)
 

·
Registered
Joined
·
4,034 Posts
Here's a thought: maybe they could bring the value of the dollar back out of the cellar by reducing some of the crushing national debt we have, and actually run the government within the means of the tax dollars. I guess I should cc this to congress as well.
It'll never work because it makes cents...er, sense, sorry. It'd be nice though, wouldn't it?
 

·
Registered
Joined
·
6,703 Posts
This is ridiculous! Instead of trying to solve the problem of OPEC SCREWING US, he pushes the blame onto the automakers??? Granted no system is perfect, but are ALL of our politicians this dense?? It's not the automakers' fault oil prices are this high!!
Actually, the consumers are the ones that are going to pay in the long run - out of our pockets and with reduced variety and selection. This is another example where the government is screwing everybody because of the actions of irresponsible buyers. People are complaining because gas prices are too high, but instead of telling them to stop complaining and buy a more efficient vehicle, they're forcing the car manufactures to change which affects everybody, even the responsible people that aren't complaining. So everybody loses.

Reminds me of the housing problem. People bought more expensive houses than they could afford, so the responsible tax payers have to bail out the irresponsible ones. Where's the incentive to be responsible? The government will do more for you if you're not.
 

·
Registered
Joined
·
2,317 Posts
HAHAHA the bush administration is showing concern for soaring oil prices by forcing the average fuel economy to rise. People can choose to buy a truck or a aveo or even a moped. Forcing companies to produce less trucks yeah thats a good way to uphold the constitution.
 

·
Registered
Joined
·
315 Posts
If GM's $6,000 estimate is correct (which it probably is a bit high), then the government is forcing us to spend more in an inefficient manner. Assume gas costs $5.00/gal in 2012, and the average life of a new car is 150,000 miles. If we did nothing with current CAFE at 26.7 MPG, the average car would consume $28,090 of gas in its 150k life span. At 31.8 MPG, the average car would consume $23,585 MPG. So the $6,000 premium to get 31.8 MPG would only net $4,505 in fuel savings over the vehicle's life span, leaving the consumer screwed out of $1,500. Gas would need to cost about $7.00 per gallon just to break even.

I know my assumptions are a bit simplistic, but it gives you an idea at least.
 

·
Registered
2015 Cadillac XTS Platinum, 1989 Merkur XR4Ti, 1989 Merkur Scorpio
Joined
·
11,108 Posts
Doesn't affect me.
I'll buy what I want before this kicks in and drive it for very a long time.
 

·
Registered
Joined
·
1,156 Posts
With gasoline going to $4 this May and no sign of it stopping after that I think in another 3 years Americans will demand 40mpg+ cars and it will be hard to sell anything else.
 

·
Registered
Joined
·
3,501 Posts
I'm waiting for China to cash in their 500 billion dollars worth of treasury bonds.

Then the bull-malarky will hit the fan big time.
 

·
Registered
Joined
·
4,822 Posts
If GM's $6,000 estimate is correct (which it probably is a bit high), then the government is forcing us to spend more in an inefficient manner. Assume gas costs $5.00/gal in 2012, and the average life of a new car is 150,000 miles. If we did nothing with current CAFE at 26.7 MPG, the average car would consume $28,090 of gas in its 150k life span. At 31.8 MPG, the average car would consume $23,585 MPG. So the $6,000 premium to get 31.8 MPG would only net $4,505 in fuel savings over the vehicle's life span, leaving the consumer screwed out of $1,500. Gas would need to cost about $7.00 per gallon just to break even.

I know my assumptions are a bit simplistic, but it gives you an idea at least.
Considering a Hybrid is about a $ 4,000 premium now (i.e. the Saturn Aura & Chevy Malibu) $ 6,000 per vehicle sounds quite fishy.

Also, I don't think the idea is to save customers on gas prices but reduce fuel demand and pollutants.

Considering we have vehicles today that meet these fuel requirements it hardly seems unreachable. While others have suggested it is somehow unconstitutional, the day may come when driving two tons of pick up truck getting 8-12 mpg is no longer possible.
 

·
Registered
Joined
·
4,800 Posts
Here's a thought: maybe they could bring the value of the dollar back out of the cellar by reducing some of the crushing national debt we have, and actually run the government within the means of the tax dollars. I guess I should cc this to congress as well.
I could not agree with you more on that point.
 
Joined
·
5,934 Posts
Reading that I've done recently shows 2 factors affecting the rise in costs of a barrel of oil early in 2008.

1). Investors (i.e. institutional investors) have created a price "bubble" by treating oil as an asset class. Traditionally, a way to hedge against higher inflation is to invest in energy. So investors are buying up oil futures.

2). The DOE is adding to the Strategic Oil Reserve early in 2008. They are adding sweet crude to the reserve which is also driving up the price for a barrel. The DOE could help alleviate this short "spike" by replacing the reserve with sour crude instead of sweet crude.

It is human nature to want to find one simple answer, or one person/group to blame. This is a complicated issue.
 

·
Registered
Joined
·
1,347 Posts
With gasoline going to $4 this May and no sign of it stopping after that I think in another 3 years Americans will demand 40mpg+ cars and it will be hard to sell anything else.
IMHO, that's why GM dropped the Ultra V-8, investing heavily in the Volt and its e-flex architecture. Capitol Hill is going off the deep-end & GM does not want to join them...

Ken
 

·
Premium Member
Joined
·
14,692 Posts
I don't expect much from the current administration. Wait for a Democrat President to ramrod through tougher legislation as passed up from a Democratic House and Senate. Or perhaps even McCain!

The handful of Michigan congressmen that GM and Ford have in their back pocket will not be enough to stop the changes when the Democrats are more pro-Green than they are pro-Union.

So I hope that GM is lining up new vehicles, and tossing out old excuses.

Personally (quality issues aside) I loved the kinds of cars GM offered in the 1980's (I once owned a 4-banger Pontiac 6000 Wagon) and I hope to see more vehicles like 4-cylinder powered compact and mid size wagons offered instead of fuel-inefficient cute utes like the Equinox that have only marginally better off-roadability and about the same cargo room.

And cool options like the upcoming E-85 capable HHR.

Because not everyone is going to have the cash to buy a pricey hybrid or Volt.

And because I'm a cheapskate who thinks it's wasteful to have 18/22 fuel economy in a crossover because what could otherwise have been a wagon was jacked up a few inches and made heavier and less aerodynamic.


 
1 - 20 of 112 Posts
Top