CAFE and Coffee: Analyzing the New Emission Standards
Obama announced new CAFE standards today.
Two quick notes:
First, they're supposed to be fully in place by the 2016 model year.
God willing, Obama will still be in office, at the end of his second term. So there'll be consistent pressure to implement these new standards.
Second, Obama announced that these requirements would add about $1300 to the price of a new car.
Notice that that's in 2016, so it's eight years to get used to the new prices. They won't suddenly jump $1300 in the last year of the phase-in.
And with cars being much better built than 20-30 years ago (mine is 10 years old, and my wife's is 15,) this $1300 can safely be amortized over a ten-year lifespan. That makes $130 a year, just over 10 bucks a month, or about $2.50 a week. Which is the price of one Starbuck's coffee, or a gallon of gas. And both of those are bound to go up before the end of the eight-year phase-in on these new standards, much less the following ten years of a new 2016-model-year car.
So, when the Republicans try to scare you with these increased costs, stay calm. Have a latte. In the long run, that'll be more expensive.
Two quick notes:
First, they're supposed to be fully in place by the 2016 model year.
God willing, Obama will still be in office, at the end of his second term. So there'll be consistent pressure to implement these new standards.
Second, Obama announced that these requirements would add about $1300 to the price of a new car.
Notice that that's in 2016, so it's eight years to get used to the new prices. They won't suddenly jump $1300 in the last year of the phase-in.
And with cars being much better built than 20-30 years ago (mine is 10 years old, and my wife's is 15,) this $1300 can safely be amortized over a ten-year lifespan. That makes $130 a year, just over 10 bucks a month, or about $2.50 a week. Which is the price of one Starbuck's coffee, or a gallon of gas. And both of those are bound to go up before the end of the eight-year phase-in on these new standards, much less the following ten years of a new 2016-model-year car.
So, when the Republicans try to scare you with these increased costs, stay calm. Have a latte. In the long run, that'll be more expensive.
Advertisement
A little bit on the shoulder off your route here, but:
For what it's worth, in the Dallas, TX area you can get a cup of Starbucks coffee for about $1.62 if you ask for a tall Pike Place in one of those washable ceramic coffee cups. Refills are about $0.50, so if you get two cups, they average closer to $1.00 each.
May 20, 2009 7:16 AM | Reply | Permalink
I'm sure that TPM'ers have, for quite some time, understood that Republicans primarily use fear to shape public debate. Ever since this strategy failed to bring down Obama in November I've been wondering if the public at large now finally understands that too.
May 20, 2009 9:41 AM | Reply | Permalink
Is there a good source for how the $1300 figure was calculated? Some manufacturers must be closer to the new standards than others, and hence will have to raise prices less.
Is the 35.5 MPG requirement after the bogus mileage credit for being able to run on the E85 ethanol blend? Although very few people drive on E85.
May 20, 2009 10:29 AM | Reply | Permalink
The 2010 Ford Fusion hybrid has an EPA rating of 41 MPG city, 36 MPG highway, and I believe 39 MPG combined. It meets the 2016 CAFE standard now, and it's a mid sized car--not a micro car.
All this does is force the car makers into doing something they were already doing in order to survive when the price of gas was $4 a gallon.
They're going to build more hybrids and make plugin hybrids from some models.
The current standard of 27.5 MPG has been there since 1990. We're long overdue for this change.
Oh, and if one crunches the numbers on the Fusion hybrid, it pays for itself after just 37K miles--long before the wheels.
$1,300? Probably more like $13.
May 20, 2009 5:43 PM | Reply | Permalink
Great post Cal. You know, sometimes we just need a two dollar calculator to fight repub propaganda.
May 21, 2009 5:18 PM | Reply | Permalink