Increase in CAFE Unlikely

Washington DC September 19, 2005; The AIADA newsletter reported that a proposal by Senate Energy and Natural Resources Chairman Pete Domenici (R-NM) that Congress raise the Corporate Average Fuel Economy (CAFE) standards on new cars and trucks is unlikely to gain much steam, already suffering “little traction in the Senate and an absolute rejection in the House,” reports Capitol Hill’s Roll Call newspaper. Domenici’s proposal would mark the first time in 30 years that a change occurred in the mandatory fuel standards. Both Domenici and Sen. Larry Craig, another recent supporter of increasing CAFE, say the proposal is a long shot. “

There may need to be some regulatory adjustment [to CAFE], but that comes with a price,” Craig said, citing the need to couple any increases in CAFE standards with measures that also increase oil production. “You have to see what you can put it together with,” Domenici said of the deal-making that is to come. “I’m working on it, but it’s hard to work because it’s dealing with two, three different committees.”

What may, however, work in the Senators’ favor is the fact that the increases they propose are in line with those proposed by the National Highway Traffic Safety Administration (NHTSA). Under this type of proposal, automakers would not be required to meet a specific standard for their entire fleet of cars. Rather, fuel efficiency increases would be based on the size of the vehicle.