Keep fuel economy standards to help our lowest income citizens

January 12, 2017


Strong miles per gallon (mpg) rules save Americans money across all income levels, but they save working families and middle-class Americans the most.

Since 1975, fuel economy improvements have saved over 1.5 trillion gallons of gasoline — about 5,000 gallons for every American.

Now, some groups see an opportunity in a new incoming administration to weaken or eliminate those standards.

If President-elect Trump truly cares about the nation beyond its wealthy elites, he will stay the course and keep the United States’ strong, wallet-friendly fuel efficiency standards in place.

Today’s national fuel economy standards — announced with car company support in 2009 — are on track to save consumers an average of $3,200 per car and $4,800 per truck over the lifetimes of model year 2025 vehicles, according to Consumers Union, the public policy arm of Consumer Reports.

If gas prices rise from their current lows, the savings will grow even bigger. This net calculation takes into account any increase in initial vehicle cost due to developing and incorporating advanced efficiency technology — any increase in car and truck prices is dwarfed by savings at the gas pump.

Saving $3,200 might not matter much to millionaires, but, for most Americans, that’s a serious chunk of change. In addition, if you look at fuel economy savings in terms of a percentage of income, you will see that robust mpg standards help the budgets of working families and middle-income Americans the most.

These families tend to spend more on fuel every year than they do on car payments, and for them, fuel savings can make a real difference.

Research we conducted at the University of Tennessee shows that from 1980 to 2014, Americans across the income spectrum benefitted from fuel economy standards. During this time, the amount of gas it took to drive a mile fell by 25 to 30 percent.

Fuel economy isn’t free. Automakers invest in innovative technologies, engineers and facilitates to build more efficient vehicles, but the savings on gasoline far outweigh the costs.

According to our research, for the lowest-income Americans — those in the bottom 20 percent in terms of household annual income — the savings as a percent of income were greatest. However, it’s the middle-income families that saved the most overall — between $10,000 and $15,000 per household over the period of our study.

The reason? Households on tight budgets tend to buy used cars and trucks. As a vehicle ages, its fuel economy hardly changes, but its price falls rapidly. Used car buyers pay much less for their vehicles but get almost the same fuel savings as new car buyers.

With change coming to Washington, there is fresh talk of rolling back the fuel economy standards despite the fact that the majority of Americans benefit from them.

When Americans spend less on gas they can spend more on cars and trucks. That’s good for U.S. manufacturing jobs. Given the increasing importance of international vehicle sales, manufacturing more fuel-efficient cars and trucks helps keep U.S. manufacturers competitive worldwide.

In addition, an economy that is less impacted by pollution, which causes lost work days and volatile oil prices, is more successful.

Automakers supported strong fuel economy standards when they were announced in the Rose Garden over seven years ago, but some now sense an opportunity to roll them back.

That’s a shame because automakers are actually ahead of the game when it comes to hitting mpg targets. They deserve a lot of credit for moving ahead with innovative new technologies and achieving results faster and cheaper than anyone predicted.

At the same time, the vast majority of Americans want their cars and trucks to be fuel-efficient, according to a series of consumer surveys conducted regularly since 2011 by Consumer Federation of America.

The latest survey, released in March, found that 81 percent of consumers support federal fuel economy standards, continuing a trend of overwhelming and bipartisan public support that goes back decades.

When it comes to fuel economy standards for the cars and trucks Americans drive every day, now is not the time to back up. Staying the course is the right path for all Americans who want to go farther on every gallon of gas — especially those who benefit the most from saving gas and saving money.

David Greene is a research professor in the Department of Civil and Environmental Engineering at the University of Tennessee, Knoxville and a senior fellow at the Howard H. Baker, Jr. Center for Public Policy.

Source: The Hill