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While I agree with this as an argument against overregulation, I find it extremely doubtful that rollback of extant standards will ever accomplish a reduction i

While I agree with this as an argument against overregulation, I find it extremely doubtful that rollback of extant standards will ever accomplish a reduction in vehicle costs. I'd certainly be interested to hear arguments or evidence otherwise, however.

brownbat 9y ago
> I find it extremely doubtful that rollback of extant standards will ever accomplish a reduction in vehicle costs. That was honestly my initial assumption too, I thought this would probably get washed out by other factors determining vehicle prices. Then I read some of the EPA and NHTSA positions. Not even the regulators go so far as to say that continuing existing regs would be costless. They estimated that the average cost per vehicle will rise $2,000. Now they add that consumers should be able to make that $2,000 back over four years through fuel savings. They do so by assuming gasoline prices will be $3.50, which is 30% higher than they currently are. https://www.usatoday.com/story/money/2016/09/23/center-for-automotive-research-cafe-fuel-economy-standards-study/90902494/ https://www.usatoday.com/story/money/2016/09/23/center-for-a... You might think (like I did) that the R&D is done, so there's no new cost. But there are mechanical costs of including certain technologies in engines, increases in complexity, production itself in terms of parts and labor would be lower without the standards. If you want the most comprehensive possible discussion of this issue, it's in the comment process for these standards: https://www.nhtsa.gov/sites/nhtsa.dot.gov/files/phase2-hd-fuel-efficiency-ghg-response-to-comments.pdf https://www.nhtsa.gov/sites/nhtsa.dot.gov/files/phase2-hd-fu... Warning, it's thousands of pages of PDF to dig through. And a lot of it is super boring! But there are some interesting anecdotes... The International Foodservice Distributors Association comments that with earlier requirements using readily available off the shelf technology, the EPA estimated a per vehicle cost of $1,200 to $1,900, but the actual costs per commercial vehicle ended up being closer to $20,000 per vehicle. The EPA basically responds that return on investment really isn't their top priority. (Which, of course it isn't, that isn't their job, but that still kind of sidesteps the problem that they might be lowballing the estimated impact-at least on commercial vehicles-by a factor of ten.) You might not agree with the IFDA, but even if you go with the EPA, they admit throughout that document they expect this to increase vehicle costs by a few thousand dollars. Aside from that random IFDA comment (and there are hundreds... thousands? of others), here's a full study on the question, costs of keeping the existing standards, from the industry side: http://www.cargroup.org/wp-content/uploads/2017/02/The-Potential-Effects-of-the-2017_2025-EPANHTSA-GHGFuel-Economy-Mandates-on-the-US-Economy.pdf http://www.cargroup.org/wp-content/uploads/2017/02/The-Poten... They say the cost per vehicle could be as high as $6,000. I think the truth is probably somewhere between the EPA answer and the official industry answer. Helpfully, the CAR study tables all include assumptions of a 2k impact, a 6k impact, and a goldilocks 4k impact. There is a cost chart on page 20 with those assumptions, and different assumptions about gas prices. But even if you're inclined to dismiss the industry's position entirely, keep in mind that they are spending money to lobby against this. If it doesn't affect production costs at all, why bother fighting? Why waste the money on the lobbyists?
- larkeith 9y ago
  That's a much larger impact than I would have ever expected - thank you for all this info! I'll need to read through the various articles when I have more time, but I'll certainly have to reconsider my views in light of this evidence.

brownbat 9y ago

> I find it extremely doubtful that rollback of extant standards will ever accomplish a reduction in vehicle costs. That was honestly my initial assumption too, I thought this would probably get washed out by other factors determining vehicle prices. Then I read some of the EPA and NHTSA positions. Not even the regulators go so far as to say that continuing existing regs would be costless. They estimated that the average cost per vehicle will rise $2,000. Now they add that consumers should be able to make that $2,000 back over four years through fuel savings. They do so by assuming gasoline prices will be $3.50, which is 30% higher than they currently are. https://www.usatoday.com/story/money/2016/09/23/center-for-automotive-research-cafe-fuel-economy-standards-study/90902494/ https://www.usatoday.com/story/money/2016/09/23/center-for-a... You might think (like I did) that the R&D is done, so there's no new cost. But there are mechanical costs of including certain technologies in engines, increases in complexity, production itself in terms of parts and labor would be lower without the standards. If you want the most comprehensive possible discussion of this issue, it's in the comment process for these standards: https://www.nhtsa.gov/sites/nhtsa.dot.gov/files/phase2-hd-fuel-efficiency-ghg-response-to-comments.pdf https://www.nhtsa.gov/sites/nhtsa.dot.gov/files/phase2-hd-fu... Warning, it's thousands of pages of PDF to dig through. And a lot of it is super boring! But there are some interesting anecdotes... The International Foodservice Distributors Association comments that with earlier requirements using readily available off the shelf technology, the EPA estimated a per vehicle cost of $1,200 to $1,900, but the actual costs per commercial vehicle ended up being closer to $20,000 per vehicle. The EPA basically responds that return on investment really isn't their top priority. (Which, of course it isn't, that isn't their job, but that still kind of sidesteps the problem that they might be lowballing the estimated impact-at least on commercial vehicles-by a factor of ten.) You might not agree with the IFDA, but even if you go with the EPA, they admit throughout that document they expect this to increase vehicle costs by a few thousand dollars. Aside from that random IFDA comment (and there are hundreds... thousands? of others), here's a full study on the question, costs of keeping the existing standards, from the industry side: http://www.cargroup.org/wp-content/uploads/2017/02/The-Potential-Effects-of-the-2017_2025-EPANHTSA-GHGFuel-Economy-Mandates-on-the-US-Economy.pdf http://www.cargroup.org/wp-content/uploads/2017/02/The-Poten... They say the cost per vehicle could be as high as $6,000. I think the truth is probably somewhere between the EPA answer and the official industry answer. Helpfully, the CAR study tables all include assumptions of a 2k impact, a 6k impact, and a goldilocks 4k impact. There is a cost chart on page 20 with those assumptions, and different assumptions about gas prices. But even if you're inclined to dismiss the industry's position entirely, keep in mind that they are spending money to lobby against this. If it doesn't affect production costs at all, why bother fighting? Why waste the money on the lobbyists?

larkeith 9y ago
That's a much larger impact than I would have ever expected - thank you for all this info! I'll need to read through the various articles when I have more time, but I'll certainly have to reconsider my views in light of this evidence.