PhotoIn a change of heart, the National Highway Traffic Safety Administration (NHTSA) has agreed to push back the date that it will start imposing penalties on carmakers for failing to meet new fuel economy standards.

In response to pleas from several automotive companies and their advocacy groups, the government agency has agreed to hold the 2019 models to the new standard.

NHTSA said it is simply bowing to the reality that carmakers design their products well in advance. Jack Nerad, executive market analyst for Kelley Blue Book, says it was the right move.

“In a month of political posturing by outgoing and incoming administrations, this action by the National Highway Traffic Safety Administration adds a needed dose of reality to the conversation around fuel economy and emissions,” Nerad said in an email to ConsumerAffairs.

By delaying the penalties until the 2019 model year, Nerad says the agency is giving the auto industry some “much-needed breathing room” in their efforts to meet standards that are made more difficult to reach by the fact that fuel is reasonably inexpensive and expected to stay that way for at least a few years to come.

Low gas prices equal lower mileage ratings

Automakers have discovered that it is much harder to sell smaller, more fuel-efficient cars when gasoline prices are barely over $2 a gallon. Instead, consumers have been buying less-efficient trucks and SUVs.

An automaker's fuel economy rating is based on the cumulative mileage rating of its entire fleet. The more trucks and SUVs a company sells, the lower its rating.

As recently as August, NHTSA and the Environmental Protection Agency (EPA) jointly finalized fuel economy and pollution standards, sticking with the original deadline.

In extending its deadline, NHTSA also granted a request by carmakers for a way to clear up discrepancies between the two different mandates administered by the two separate government agencies.

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