VW Fights the 2025 CAFE Law. Yes, Beetle-Loving Volkswagen

By · August 05, 2011

Volkswagen JETTA

The VW Jetta TDI is a mileage champ at 40 mpg on the highway, but gets no CAFE respect. (VW photo)

Of all companies, it’s Volkswagen (home of the Beetle) that’s fighting the recently acclaimed-by-all-hands 54.5 mpg Corporate Average Fuel Economy (CAFE) standard for 2025. Why? VW makes mostly cars and diesels, and the proposal as loopholed favors trucks and disses diesels.

Surely, VW will sell a lot of fuel-efficient Jettas and Passats with this deal, right? Sure, but it also won't get much credit for the green diesels it produces. I’ve got some respect for VW’s stance here, which reminds us that the process isn’t over just because automakers, regulators and Obama held hands and sang “Kumbiya” at the White House. The actual final number won’t be announced until September, and then there’s a comment period.

VW’s U.S. CEO Jonathan Browning told Ward’s that the company has “a dialogue going with the administration in terms of how we think the policy needs to be adjusted.” Something tells me that other automakers, some of whom (looking at you, Ford) fought down to the wire to get the best possible deal, won’t like the idea of backroom negotiations after everyone agreed to the current loopholes and adjustments.

In a statement, Tony Cervone, a VW vice president, was pugnacious, “Volkswagen does not endorse the proposal under discussion,” he said. “It places an unfairly high burden on passenger cars, while allowing special compliance flexibility for heavier light trucks.

"Passenger cars would be required to achieve five percent annual improvements, and light trucks 3.5 percent annual improvements. The largest trucks carry almost no burden for the 2017-2020 timeframe, and are granted numerous ways to mathematically meet targets in the outlying years without significant real-world gains.”

That’s actually totally true, and it’s the price Obama paid to get a deal with the Big Three. VW is coming at this from the left, claiming that it wants the proposals to be greener, encouraging more diesels and closing truck loopholes. It seems to be calling for all vehicles, including trucks, to make a five percent fuel economy improvement. Those tweaks would totally encourage automakers to produce more hybrids and electrics, since they’d find it harder to reach 54.5 any other way with the loopholes closed.

Some VW models in the U.S. market are 80 percent diesel, and a Passat so-equipped gets 43 mpg. But VW complains that the laws as written offer “no consideration” for offering diesels. That shows how U.S.-centric the CAFE rules are, since European governments (especially France, where they’re 70 percent of the motor pool) bend over backwards to encourage diesels.

It wouldn’t surprise me if some kind of diesel incentive comes out of these smoke-filled-room discussions. But the incentives for the trucks and SUVs, those are going to stay in place. It’s a loophole big enough to drive a gas guzzler through, and that’s just what Detroit is going to do.

There are other things that need reforming as part of CAFE, including the fact that the test procedures date, incredibly, to the 1970s, and actually give cars credit for 25 percent more fuel economy than they actually offer. It's confusing, because the window sticker tests are separate, and actually much better than they used to be. For CAFE, they have cars running at a steady 48 mph (on the highway!) with no stopping and no air conditioning or radio. It's simulated in the lab, so the conditions are even better than that indicates.

The Sierra Club is incensed about the testing procedures, though it may have a hard time getting much traction on the issue. Congress would have to approve any reform, and that's the furthest thing from its collective mind at the moment.

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