Auto execs: U.S. mpg standards within reach, but may change

Reuters

By Deepa Seetharaman

DETROIT, Jan 15 (Reuters) - Changes in the U.S. political climate or consumer tastes may force a revision of federal standards that require automakers to nearly double the overall gas mileage of their cars and trucks by 2025, industry executives said on Wednesday.

Executives expressed confidence the industry can hit the higher targets, which were finalized by the Obama administration in 2012. But the figures come under a "midterm review" in 2017 and it is open question whether the targets survive.

"We know we're going to have a new president," at that time, said Brian Kesseler, head of power solutions at supplier Johnson Controls Inc, said during a conference coinciding with the Detroit auto show.

"We don't know who it will be and so that will frame it," he said. "I think (the targets) are achievable. Will it manifest itself in a regulation? Jury is still out."

The 2025 goals call on automakers to boost their corporate average fuel economy (CAFE) to 54.5 miles per gallon, up from 29.7 mpg in 2012 and 30.5 miles per gallon in 2013.

Hybrids, electric cars and gas-powered vehicles equipped with turbochargers that boost fuel economy tend to cost more than more traditional cars, although the gap is shrinking.

Consumer demand for vehicles that get better fuel economy may wane, said Ford Motor Co's purchasing chief Hau Thai-Tang, adding that the second-largest U.S. automaker has a detailed plan to hit the targets.

"The one caution we have (is) if the regulatory requirements really outpace the consumer demand, is that a healthy thing for the industry?" Thai-Tang said. "And that's going to have to be part of the dialogue."

CAFE is a theoretical standard used to check if companies are meeting fuel economy targets, but it is not the same as the real world gas mileage found on the window stickers of new cars at U.S. dealerships. That "real world" gas mileage figure is measured by the U.S. Environmental Protection Agency.

The 2025 CAFE target translates to 36 miles per gallon or higher in real world driving, according to some experts.

The average fuel economy of new vehicles sold in 2013 was a record 24.8 miles per gallon, according to the University of Michigan Transportation Research Institute.

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