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NHTSA reinstates fines against automakers that failed to meet fuel standards

Industry officials indicate that extra costs could be passed to consumers

Empty gas gauge
Photo (c) esemelwe - Getty Images
The National Highway Traffic Safety Administration (NHTSA) has come down hard on automakers that manufacture gas-guzzling vehicles. In a newly released ruling, the agency stated that it is reinstating fines on automakers that failed to meet Corporate Average Fuel Economy (CAFE) requirements on 2019 models and later. 

In 2012, the NHTSA established standards that required fuel economy levels for 2017-2021 model passenger cars and light trucks to be between 40.3-41.0 mpg. The Obama administration modified the policy in 2016, applying it to 2019 and later model vehicles. Current goals are set out as far as 2035, when the CAFE target is 57.6 mpg for passenger cars.

For consumers, improving fuel efficiency is a no-brainer. However, there have been challenges from industry groups who claim that pushing innovation in that direction will come at a cost. Adding fines into the equation muddles the matter even further.

The industry estimates that the newly reinstated fines could cost carmakers up to $1 billion each year, and those extra costs could affect consumers.

“The imposition of [penalties to] 2019 to 2021 vehicles actually could have deleterious environmental impacts: penalties that lead to increases in the prices of newer vehicles could discourage consumers from purchasing more efficient, cleaner vehicles.” 

What automakers need to improve?

When ConsumerAffairs took a look at the Department of Transportation’s CAFE dashboard, we found that some automakers are close to hitting fuel targets and others have a long way to go.

For example, for 2020 model cars, GM missed the mark by about 4 mpg. Meanwhile, Daimler (Mercedes-Benz) missed its 41.4 mpg goal by about 7.5 mpg. 

Needless to say, manufacturers that put a lot of their eggs in the electric vehicle basket are happy they did. As an example, Tesla – which often finds itself on the bad side of the NHTSA –  beat its mpg goal by nearly 700 mpg.

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