Despite an earlier mandate requiring a fleet-wide average of 35.5mpg by 2016, the Obama administration is currently mulling a fuel economy exemption that would benefit luxury automakers like Germany’s BMW and Mercedes-Benz .
Dubbed ‘The German Provision’ by industry lobbyists, the proposed provision would allow automakers that sell fewer than 400,000 vehicles annually in the United States to conform to a less stringent set of CAFE regulations. No exact figures have been named, but the targets would be well under 35.5mpg and would continue through 2020.
Although such a law would benefit smaller automakers – such as Suzuki and Mitsubishi – BMW and Mercedes-Benz would stand to benefit the most. BMW and Mercedes-Benz are known for producing large, powerful vehicles, with some models failing to hit the 15 mpg mark. BMW and Mercedes also contend that the added features of their vehicles carry a significant weight penalty, thereby reducing overall fuel economy.
Moreover, if President Obama signs off on the legislation, the automakers would likely push for an extension beyond 2020. “Once companies become dependent on these provisions, they have an incentive to hire lobbyists and exert political pressure to extend those same provisions,” John Graham, a former member of the Bush administration, told The Wall Street Journal.
The proposal is expected to be presented to the Environmental Protection Agency and the Department of Transportation later this year.
