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Increase Corporate Average Fuel Economy (CAFE)
Standards
The average fuel economy of cars and light trucks has declined
from about 26 mpg in 1988 to 24 mpg in 2000 due to increasing
vehicle size and power, the rising market share of light trucks, and
the lack of tougher CAFE standards. The original standards for cars
were adopted in 1975 and reached their maximum level in 1985. We
recommend increasing the CAFE standards by 5% per year for 10 years
so that they reach 44 mpg for cars and 33 mpg for light trucks in
2012, with further improvements beyond 2012. Alternatively, the
standards for cars and light trucks could be combined into one
value, specifically 38 mpg by 2012. This level of improvement would
be technically feasible and cost-effective for consumers, and can be
achieved without compromising vehicle safety. To facilitate
compliance with the tougher standards, CAFE should be complemented
by a combination of policies, including: implementing tax credits
for purchasers of innovative, highly efficient vehicles; expanding
taxes on gas-guzzling vehicles; increasing labeling and consumer
education efforts; and continuing vigorous R&D on
fuel-efficient, low-emissions vehicles.
For more information:
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