Congress should pass a federal gas tax on consumers instead of continuing to impose CAFE regulations on automakers, says the CEO of Edmunds.
Jeremy Anwyl, who heads the iconic source of auto information, again raised the idea he has long advocated via his blog Tuesday and in conjunction with his attendance at the 2011 Government/Industry Meeting of the Society of Automotive Engineers taking place this week in Washington, D.C.
CAFE, or Corporate Average Fuel Economy, regulations are designed to promote fuel efficiency and require an automaker's fleet to meet a specific average gas mileage.
Anwyl said that spurring a desire in consumers for better gas mileage would have a greater impact on reducing gas use, regardless of what kind of technology is used to get there.
"Raise the price of gas and the playing field tilts. Consumers will start making free choices that also help save fuel and improve the environment," Anwyl said in his blog post.
The idea is something Anwyl has backed for years. Last month, he began reiterating the idea, agreeing with a recommendation from the National Commission on Fiscal Responsibility and Reform that suggested incrementally raising a tax on gasoline about 15 cents at a time. But Anwyl argued that the commission was not proposing a strong enough measure and should be suggesting a $2 per gallon tax on gasoline, with exceptions for low-income individuals.
Anwyl pointed out that in addition to electric vehicles and hybrids, there are many breakthroughs in gas and diesel engines that have already resulted in better gas mileage. He noted in particular the Mercedes-Benz BlueTEC diesel and the Volkswagen TDI clean diesel engines.
Anwyl's mention of Volkswagen is significant. The German automaker's successful unit sales of small-engine diesel cars in Europe--where many countries have heavily taxed gasoline and heavily taxed cars based on engine size--are often attributed to high gas mileage and serve as an example of how a U.S. gas tax might influence consumers.
In his blog, Anwyl cited past CAFE regulations as one of the reasons U.S. automakers found themselves forced to make cars they could not sell and, ultimately, in need of a bailout.
"Yes, vehicles have become more efficient. Was this because of CAFE? For the sake of discussion, let's say yes. On that 2 dimensional scale, CAFE worked. But it also forced automakers to build vehicles that the market did not want. These must then be sold at a loss, creating a dynamic in which small cars are subsidized in order to earn the CAFE credits needed to sell large vehicles at a profit," Anwyl said.
Anwyl added that while current gas prices reflect the inherent cost of drilling, refining, and transporting oil, nowhere is there a built-in tax for the cost of cleaning up the environment as a result of its use.