President Obama on Tuesday unveiled a plan for tougher vehicle mileage standards that would require an average of 35.5 mpg for cars and trucks within seven years in a move aimed at cutting greenhouse gases and reducing dependence on foreign oil.
The tougher CAFE standards — or corporate average fuel economy — could end years of bitter wrangling between the auto industry and California, whose strict standards have outpaced federal guidelines.
The new standards would cut greenhouse gas emissions from new cars and light trucks 30 percent by 2016. Cars would have to get 39 mpg, light trucks 30 mpg. Those new targets would come four years earlier than under current law, the White House said.
The president — joined by the heads of Ford, Toyota, GM, Chrysler and other auto manufacturers — said the plan was good for consumers, good for the economy and good for the environment.
The fuel efficiency goals are on par with a plan that California adopted several years ago and more than a dozen other states have copied. The auto industry has been fighting those standards in court for several years. California Gov. Arnold Schwarzenegger was seated in the audience during the announcement.
The Obama administration brought the disputing parties together, and after weeks of negotiations, they reached a compromise. As a result, the auto industry will drop its lawsuits against California and the other states, the president said.
The White House said the cost of building more fuel efficient vehicles would increase their cost by about $1,300, but "even as the cost of building these cars and trucks goes up, the cost of running them will go down," the president said.
Within three years, the fuel savings would make up for the bigger price tag, he said.
"At a time of historic crisis in our auto industry, this rule provides the clear certainty that will allow these companies to plan for a future in which they are building the cars of the 21st century," the president said.
Obama, who said the proposal would save 1.8 billion barrels of oil and reduce greenhouse gas emissions acknowledged that the auto industry and economists "have been at odds for years" and that "we have done little ... for decades to improve [fuel] efficiency."
Environmentalists say this means that all cars sold across the nation will use less gasoline and create less pollution.
"This is the biggest single step we can take to curb global warming," said Dan Becker, director of the Safe Climate Campaign.
"It is the first major effort by the United States to deal with the thing that we do that is most out of whack with the rest of the world, which is run giant behemoths on the road that guzzle gas and pollute the atmosphere," Becker added.
California gets credit for doggedly pushing the auto industry to change, said David Friedman of the Union of Concerned Scientists, an environmental group.
"We probably wouldn't even be talking about global warming standards for cars if it weren't for California's landmark 2002 bill requiring standards for cars and trucks," Friedman said.
California did, however, have to compromise. The federal standards ramp up more slowly than the state had wanted.
"In return," said Aaron McLear, a spokesman for Schwarzenegger, "we get a national standard in 2016 that will meet our standards, and we'll partner with the federal government to have a national standard that will be a far more powerful effect on our environment than if we were going at it alone."
California still wants the Environmental Protection Agency to grant it permission to enforce its own greenhouse gas standards until the federal plan kicks in. There's no decision on that yet.