Automakers Agree to 54 MPG Standard

Last Updated Jul 29, 2011 11:17 AM EDT

Major car companies have had a change of heart -- and drivers stand to benefit.

After decades of fighting higher federal gas mileage standards, the big automakers have agreed to new standards that will require a average of 54.5 MPG by 2025.

High gas prices, new energy-efficient technologies and strong sales of small, high-MPG cars this year may have convinced the companies that the new standard -- which is being announced today and will affect all vehicles an automaker sells in the Untied States -- was both desirable and feasible. Automakers are already on their way toward meeting a 35.5 MPG average for 2016.

One reason Ford, GM and Chrysler may have gone along with the new regulation is that they got a lower standard for their profitable pickup trucks. The cumulative 2025 standard for cars is 60 MPG. But the lower truck requirement brings the overall average down to 54.5. (The White House had originally been pushing for a 62 MPG overall average, but Ford, General Motors and foreign automakers managed successfully lobbied for the lower figure.)

Meeting the 2025 standard will require much the automakers to sharply increase sales of hybrid, electric and high-mileage diesel cars. One challenge may be cost: Consumers often are reluctant to spend more for hybrids and diesels, even though they will produce fuel savings. Current high-mileage cars selling well include models like the Chevrolet Cruze (at left) and Ford Fiesta, which have traditional gas engines and are priced competitively.

"Even now we see low hybrid and electric vehicle sales despite high gas prices," says Michael Omotoso, chief power-train forecaster for J.D. Power and Associates. "Consumers are reluctant to pay a $5,000 premium for a typical hybrid car."

But consumer and environmental groups praised the new agreement, saying it would help lower prices. "The new standards will lead to cars that consume less fuel at an affordable price," says Ellen Bloom, head of the Washington office of Consumers Union -- publisher of Consumer Reports. "Consumers will be able to save money on gas over the life of their vehicles while we reduce national oil consumption." Bloom points out that a Toyota Prius has already registered a 55 MPG average in highway driving in Consumer Reports testing.

On the technology front, here is where mileage progress is being made:

Plug-in electrics: Toyota is introducing a plug-in electric Prius which should be rated for even higher mileage than the current model. In this Prius, the battery is recharged between trips by plugging into an outlet or special home charger, in addition to the traditional regenerative braking charge while the car is on the road. Ford is also bringing out a plug-in electric version of its Focus this year (pictured at right). Ford says it will offer faster charging of three to four hours with its 240-volt at-home charging station.

Diesel: General Motors has announced that in 2013, it will bring to the U.S. a model of the Chevrolet Cruze that gets 50 miles per gallon on the highway. Ford is already selling diesel cars in Europe that are competitive with that number, so it may be tempted to bring those here as well.

Ford electric photo by Jerry Edgerton
Chevrolet Cruze photo courtesy of General Motors
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    Jerry Edgerton, author of Car Shopping Made Easy, has been covering the car beat since Detroit companies dominated the U.S. market. The former car columnist for Money magazine and Washington correspondent for Business Week, Edgerton specializes in finding the best deals on wheels and offering advice on making your car last.

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