The problems with the new proposal:

• The administration’s claim of saving 10 billion gallons of gasoline with this proposal amounts to less than one month's worth of gasoline saved over nearly two decades.  That is just over a day’s worth of oil saved each year, a drop in the barrel.
• At best, the proposal does nothing through 2010.  The estimated 1.8-mpg increase between 2008 and 2011 is offset by the energy bill’s extension of the “dual fuel loophole” (a loophole giving automakers extra fuel economy credit for vehicles that can run on alternative fuels, but rarely do).  In 2010, UCS projects the proposed standards could, at most, reduce a modest 900 million gallons of fuel, while the extended dual fuel loophole would increase fuel use by one billion gallons.
• The NHTSA proposal continues to exempt vehicles over 8,500 pounds, which represent five percent of light duty vehicle fuel use.  This leaves farmers, contractors and other businesses with no options to help them fight high gasoline costs.
• The administration’s plan may create additional loopholes with a new structure based on vehicle size (the bigger the vehicle, the lower your fuel economy target) that could wipe out the 1.8-mpg increase over time.  This sets up the potential for automakers to upsize their trucks to take advantage of weaker standards, repeating the erosion that has taken place since fuel economy peaked in 1987 as automakers have shifted from “cars” to “light trucks” with lower fuel economy standards.
• The new size-based fuel economy system technically addresses one of the big automaker arguments, that under the old system, different automakers are treated the same regardless of their sales mix.  The administration failed to take advantage of this and produced annual fuel economy increases that are no larger than what was achieved under the old system.
• The administration incorrectly claims the new size based system helps close the loophole between passenger and non-passenger vehicles because the fuel economy target for vehicles like the PT Cruiser and Subaru Outback are higher than the car standard.  The problem with this claim is that all automakers have to do is increase the Subaru Outback length and width by one-quarter inch (a little over an inch for the PT Cruiser) to drop their fuel economy targets by more than one mpg, to below the current car standard.  Further, the Dodge Magnum station wagon still gets to be called a truck, and it is in the same size class as Ford's big SUV, the Expedition, with a 2011 target that many of the Magnums already exceed today.
• The proposed standards were set based on assuming gasoline prices of less than $1.60 per gallon.  While this is what EIA has predicted for gasoline prices in the past, their forecasts have been raised and still appear quite optimistic in a world of growing oil demand from developing nations.

The solutions:

• UCS analysis indicates that closing existing loopholes—including requiring light trucks to meet today’s car standard of 27.5 mpg within five model years—could cut gasoline use by 11 billion gallons in one year alone, 2015, saving consumers $14 billion.  Increasing the fuel economy standard for cars, which NHTSA has the authority to do, would save even more.
• There is a solid engineering and economic basis for NHTSA to double or triple their proposed “light truck” increase of less than 0.5 mpg per year.  NHTSA should take full advantage of the potential of the new size-based system to increase fuel economy at a rate of 1.5 mpg per year.  This would allow SUVs, minivans and pickups to reach today’s car standard of 27.5 mpg by 2011.  This can be done with off-the-shelf technologies for about $800 per vehicle that would pay for themselves in just over a year at today’s gas prices.
• Closing the fuel economy gap between cars and light trucks would cut fuel costs for truck buyers by at least 25 percent, equivalent to reducing gasoline prices to below $2.00 per gallon from August’s record high of more than $2.60.
• Bringing vehicles over 8,500 pounds under fuel economy regulations, would include vehicles like the Ford Excursion, GMC Yukon XL, and Hummer H2, many of which conveniently exceed the 8,500-pound exclusion limit by no more than 100 pounds.  The same technology that can increase the fuel economy of other SUVs and pickups can be used to save farmers and contractors thousands on gasoline.
• Implementing checks and balances would allow the new size-based structure to address automaker concerns while actually saving oil.  One option would be to implement an oil savings target alongside the new structure.  If the oil saving target were not met, the standards for all classes would be automatically ratcheted up at a faster rate.
• NHTSA did avoid using weight as the key attribute for their new system.  This avoids making the highways more dangerous by encouraging automakers to increase the weight of their vehicles to meet lower targets.  NHTSA should seek to improve highway safety by promulgating significantly stronger roof crush standards and other regulations that address the safety flaws of vehicles on the road today.

NHTSA is accepting comment on their proposed rules until November 22nd, 2005. The agency is then expected to issue a final rule in April 2006.