For years, the economy and the environment have been locked in a battle for American support, and it seems that the environment scored a minor victory recently in Congress. The Environmental Protection Agency and the National Highway Traffic Safety Administration have finalized their plan to increase the fuel-efficiency standards for cars in the United States to 54.5 miles per gallon by 2025. This announcement has been in the making for some time and comes on the heels of President Barack Obama’s plan to decrease the county’s dependence on foreign oil while increasing efforts to cut down on carbon emissions — which are now considered to be a pollutant by the EPA.
The policy comes at a time when global warming is becoming a difficult topic to ignore. California Institute of Technology recently released a report warning that coastal regions could be underwater by 2050. The study shows that sheets of ice in Antarctica and Greenland are melting faster than previously anticipated, and sea levels could rise by six inches in the next 40 years. According to Isabella Velicogna, co-author of the report, this seemingly small increase will be disproportionately distributed to low-lying areas. This means that an average sea-level increase of six inches across the globe could amount to several feet for countries like Bangladesh.
An increase in the global temperature may also account for the increase in extreme weather that we’ve experienced over the past couple years. The climate change acts like a Red Bull for hurricanes and droughts, whose intensities have increased dramatically in recent years. Though the research linking extreme weather events and global warming is still ongoing, the trend is undeniable in the eyes of many environmentalists. With an expected annual cost of $200 billion to repair the damages done by these disasters, it’s clear that any effort made to alleviate the global warming issue has the potential to not only save the planet, but actually be a fiscally responsible undertaking.
A clear-cut way to keep our planet cool is to decrease our carbon footprint, and a large contribution to that footprint is the exhaust from our tailpipes. If the 54.5 mpg goal is achieved, it has the potential to decrease oil consumption by 2.2 million gallons of oil and 43 million pounds of carbon emissions per day. Though vehicle emissions are only a small part of a larger problem, you have to start somewhere.
This legislation seems like a slam dunk by the EPA — right? Not if you ask auto industry representatives. This policy would force companies that don’t want to face fines by the EPA into making cars that may be above their means. The policy would force companies to convert much of their fleet into hybrid vehicles that — according to a Nov. 28 Wall Street Journal article — have seen a recent decline in sales. Hybrid vehicles account for a lowly 3 percent of the market, but if auto companies wish to meet the new EPA standards, about 25 percent of their fleet must be converted.
This could spell disaster for auto companies on two fronts. The first being that it’s expensive to make hybrid vehicles compared to the standard vehicles of today. In case you haven’t noticed, the American auto makers aren’t exactly flush with capital at the moment. The second problem is that consumers aren’t chomping at the bit to drive these expensive, fuel-efficient cars, and trying to sell 25 percent of your merchandise to a consumer base of 3 percent isn’t exactly good for business. Not to say that these numbers won’t change over time — as consumers’ options may become more limited due to an inevitable influx of hybrids on the market — but right now it seems like a big blow to car makers.
This policy won’t just hurt the auto industry, it will affect consumers as well. The price of a new car will increase by an estimated $3,100 — making it much harder for low-income households to afford.
So, once again, the line in the sand has been drawn between the environment and the economy with no clear way to please both sides. The key factor in this debate will come down to the consumer. American consumers have the power to ease the worries of auto companies by stepping up and buying hybrids. A boost in sales could help to ensure the 54.5 mpg goal is met on schedule without jeopardizing the American auto industry’s future. If consumers remain content with their less efficient vehicles, auto makers will be stuck with a surplus of cars no one wants and will have to struggle to stay out of the red. The culmination of this argument is simple: Uncle Sam wants YOU to drive a hybrid.
Joe Sugiyama can be reached at jmsugi@umich.edu.