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Study: No savings at 62 mpg

Could rising CAFE standards end up costing you more in the long run? Automotive News reports.

Raising federal fuel economy standards to as high as 56 mpg in the 2025 model year would yield fuel savings to consumers that more than offset higher vehicle prices, a new study found.

But lifting corporate average fuel economy to 62 mpg would result in vehicle price increases that exceed fuel savings over a five-year period, according to the nonprofit Center for Automotive Research.

The report highlights room for compromise on the Obama administration's preliminary proposal to raise CAFE to between 47 mpg and 62 mpg from the 2017 to 2025 model years.

Environmental groups have pushed for 62 mpg, while automakers have called for more study.

Current rules require a 35.5 mpg CAFE by the 2016 model year.

The center in Ann Arbor, Mich., is partially financed by the auto industry but this study was internally funded, [Center for Automotive Research] President Jay Baron said.

The June 11 report revises an earlier study in response to criticism by an environmental group, the International Council on Clean Transportation.

Among the latest findings:

  • Technology changes would drive up the average cost of a new vehicle by between $3,810 and $11,390, depending on CAFE targets, from 2008 to 2025.
  • Fuel savings would range from $5,917 to $8,339, depending on CAFE requirements, over the first five years of a 2025 car.
  • Under 47 mpg, 51 mpg and 56 mpg targets, fuel savings would exceed the increased cost of a new vehicle.

The administration's preliminary proposal used different research methods that yielded net savings for consumers even under the 62 mpg standard.

The administration is in talks with automakers and California regulators as it prepares to submit a formal CAFE rule proposal in September and make a final decision by July 2012.

(Source: Automotive News)