From: BC Upham, Triple Pundit, More from this Affiliate
Published April 5, 2010 06:07 AM

How Will New CAFE Standards Change Cars?

How will new fuel efficiency requirements that went into effect last week change the look, feel — and price — of your next car? Experts say expect prices to rise, and smaller, lighter, technologically advanced vehicles to grow in number.

New Corporate Average Fuel Economy (CAFE) standards published last week require most automakers to raise the average fuel efficiency of the vehicles they sell to 34.1 miles to the gallon by the 2016 model year rising to 35 mpg when efficiency gains in air conditioning are included. Currently, the CAFE for cars stands at 27.5 mpg, and 23.1 for light trucks.


The standards are expect to reduce CO2 emissions by about 30 percent between 2012 and 2016, and save the country $240 billion from fuel savings, pollution reduction and reduced imports. Automakers have accepted the new standards because they are firm, ending a period of uncertainty; and nation-wide, so manufacturers do not have to contend with a patchwork of different state requirements.

More expensive on the front end, cheaper over time

So how will the average new car in 2016 be different from ones on the lot today? First off, it will cost more.

The new standards are expected to cost automakers $52 billion, and those costs will trickle down to consumers: the price tag on a new car will be $1,100 higher, according to Consumer Reports. But fuel savings will be significant: up to $3,000 over the life of the average vehicle.

Of course, the cost of meeting the standards for less efficient cars could be much higher — it could cost $9,000 more to bring a full-sized pick-up up to par, according to

New spins on old technologies

The CAFE standards are not going to single-handily usher in the era of the electric car. All-electric vehicles like the Nissan Leaf have garnered a lot of press attention, but the technology is still very expensive compared to gasoline engines.

Rather, the standards will first and foremost incentivize improvements to gasoline engines. Dual-clutch and seven or eight speed automatic transmissions could increase fuel efficiency, along with lighter components.

Diesel engines, which are typically more fuel-efficient, are likely to be more familiar in the States as a result of the change. More hybirds like the Prius, Chevy Volt and others will help automakers meet the new standards.

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