New Fuel Efficiency Rules
Future tractor-trailers, school buses, delivery vans, garbage trucks and heavy-duty pickup trucks must do better at the pump under first-ever fuel efficiency rules coming from the Obama administration.
The Environmental Protection Agency and the Transportation Department are moving ahead with a proposal for medium- and heavy-duty trucks, beginning with those sold in the 2014 model year and into the 2018 model year.
The plan is expected to seek about a 20 percent reduction in greenhouse gas emissions and fuel consumption from longhaul trucks, according to people familiar with the plan. They spoke on condition of anonymity because they did not want to speak publicly before the official announcement, expected Monday.
Overall, the proposal is expected to seek reductions of 10 percent to 20 percent in fuel consumption and emissions based on the vehicle's size. Large tractor-trailers tend to be driven up to 150,000 miles a year, making them ripe for improved miles per gallon.
The rules will cover big rig tractor-trailers, ``vocational trucks'' such as garbage trucks and transit and school buses, and work trucks such as heavy-duty versions of the Ford F-Series, Dodge Ram and Chevrolet Silverado.
So how will this affect Detroit?
"When you talk about these big vehicles that are going to be for the first time ever affected by fuel economy regulations, the Detroit 3 don't play a very big role in that market. We're talking semi-trucks, garbage trucks, school trucks, that sort of thing. So while some of their model lines will be affected, it doesn't involve a whole lot of numbers there in terms of sales compared to the rest of their organizations," said WWJ Auto Analyst John McElroy.
McElroy says the new regulations will get quite expensive for some companies.
"The problem is of course these are the kinds of vehicles that a lot of municipalities own, that a lot of school systems own. And as we all know they're under severe budgetary pressure right now and this will definitely drive up the cost of them trying to acquire any kind of vehicles like this going forward," said McElroy.
Why did these regulations take so long?
"The theory always was that these were work vehicles. There's nothing frivolous about them. They're helping people with their jobs and work. So they weren't expected to carry the same kind of burden that passenger cars would have, for example. And that's why we haven't seen those kinds of regulations up till now, but of course if you truly want to reduce oil consumption you have to then regulate all vehicles that use it," said McElroy.
The White House has pushed for tougher fuel economy standards across the nation's fleet as a way to reduce dependence on oil and cut greenhouse gas emissions tied to global warming.
The fleet of new cars, pickup trucks and SUVs will need to reach 35.5 mpg by 2016, and the government is developing plans for future vehicle models that could push the standards to 47 mpg to 62 mpg by 2025.
Medium-duty and heavy-duty trucks are much less fuel-efficient than conventional automobiles; the fleet of tractor-trailers typically get about 6 mpg to 7 mpg, while work trucks can achieve 10 to 11 mpg. But they still consume about 20 percent of the transportation fuel in the U.S.
Margo Oge, director of the EPA's Office of Transportation and Air Quality, told reporters last week the proposed rules would be a ``win-win situation for the country, the economy, climate change and energy security.'' She declined to release details.
President Barack Obama was joined by truck manufacturers in the Rose Garden in May when he said the government would release the first-ever proposed standards for greenhouse gas emissions and fuel efficiency for large trucks this year. Obama estimated then that the fuel efficiency of tractor-trailers could be improved by 25 percent using existing technologies.
``This is going to bring down the costs of transporting - for transporting goods, serving businesses and consumers alike,'' Obama said on May 21, flanked by executives with Daimler Trucks, Volvo, Cummins and Navistar, and trucking industry and union officials.
The improvements in fuel efficiency will come through a combination of more efficient engines, improved aerodynamics and better tires.
Environmental groups have pointed to a National Academy of Sciences report this year that said the trucks could make broad improvements during the decade through existing technologies. The report found that using advanced diesel engines in tractor-trailers could reduce fuel consumption by up to 20 percent by 2020 while hybrid versions of garbage trucks and buses could see a 35 percent cut in fuel use by 2020.
``Whether you are a company or an individual truck owner, you will be saving money on day one because you'll be saving more on fuel than increased loan payments on a big truck,'' said David Friedman, research director for the clean vehicles program of the Union of Concerned Scientists.
Copyright, 2010. WWJ Newsradio 950, All Rights Reserved. AP contributed to this report.
