The National Highway Traffic Safety Administration (NHTSA) today announced a proposal that significantly increases Corporate Average Fuel Economy standards, especially for light and commercial trucks. Prior to the proposal going public, General Motors made a presentation to the Biden Administration claiming stringent fuel economy standards could cost automakers $300 billion in fines. Now, GM isn’t quite as sure about that. Allow us to explain.
First, the proposal. You’re free to read all 696 pages of it, officially released today by NHTSA. It’s a proposal at this stage, meaning nothing is official and once it’s published in the Federal Register, a 60-day open comment period begins. The TLDR version boils down to a few major points, with perhaps the biggest being a 10 percent year-over-year fuel economy improvement in commercial pickup trucks and vans, starting in 2030. Specifically, this applies to vehicles with gross weight ratings over 8,500 pounds but less than 14,001 pounds.
Stepping down a notch, the proposal also calls for a 4-percent annual increase on light trucks, starting in 2027. That covers the best-selling vehicles in North America, namely the Ford F-Series, Chevrolet Silverado, GMC Sierra, and Ram 1500 trucks. In the world of passenger cars, a 2-percent yearly increase would also start in 2027. And it all leads to a fleet average of 58 mpg for automakers by 2032. According to NHTSA, the proposal could save consumers more than $50 billion in fuel costs over a vehicles’ lifespan.
Clearly, the proposal takes some aggressive steps with trucks. We can understand how that might make Detroit automakers nervous, which brings us back to General Motors. Publically available documents from the Executive Office of the President show GM Vice President David Strickland making a presentation on July 17, wherein potential fines to automakers approaching $300 billion were floated. According to Reuters, NHTSA officials called GM’s figures “pure speculation and inaccurate.”
Speaking to Motor1.com, GM Senior Director of Public Policy and Communications Jeannine Ginivan explained the company hadn’t seen the actual proposal when the July 17 presentation was made. Now that’s it public, GM doesn’t offer any specific comment regarding potential fines to automakers. Through Ginivan, GM offered this official statement regarding the proposal:
“Our commitments and investments in an all-electric future place GM in an excellent position to contribute to the Administration’s goals. We welcome the intent to align NHTSA and EPA standards and providing flexibility to the industry to achieve those targets.
GM will review the proposal in detail and provide comments as appropriate.”
If average fuel economy standards aren’t met, automakers are levied fines based on the difference. Ideally, hyper-efficient vehicles and EVs balance out thirsty ones, though light and medium-duty trucks haven’t been held to quite the same standards as other vehicles.
We suspect GM – along with Ford and FCA – will have some input during the 60-day open-comment period.
