The U.S. government’s proposal to tighten fuel economy standards by 2032 could cost major automakers billions. The level of penalties for failure to comply with proposed average fuel economy (CAFE) standards is “alarming,” said a letter Friday from the American Automobile Policy Council (AAPC), Chrysler parent GM Stellantis and ford Motor represents, to the Ministry of Energy.
General Motors would therefore have to expect payments of 6.5 billion dollars, Stellantis around 3 billion. According to the letter, Ford faces fines of around $1 billion Volkswagen would have to pay the most of all foreign car manufacturers, at over a billion dollars. GM and Stellantis declined to comment beyond the letter. Ford and VW did not immediately respond to a request for comment from Reuters.
According to GM, requiring automakers to reach 67 percent electric vehicle share by 2032 would not be enough to meet the CAFE program. The three Detroit automakers would face costs of $2,151 per vehicle, compared to an average of $546 per vehicle sold by other automakers, the letter said. Politicians therefore reward “the car manufacturers who resist the transition to a purely electric future” the most.
Automakers buy credits or pay penalties if they don’t meet CAFE requirements. In June, Reuters reported that Stellantis and GM paid a total of $363 million in CAFE penalties for failing to meet U.S. fuel economy targets for previous model years.