At a time when all the American auto makers are struggling and hanging on by a thread just to survive, President Barack Obama instituted some actions that will make the auto industry go green sooner rather than later. Obama’s green car rules give the ailing car makers new challenges besides just trying to survive.
While President Obama’s plan could bring more hybrids, smaller cars and advanced fuel savings technologies to the showroom, it is ultimately the consumers that will be faced with a bigger up front sticker price as the new regulations are expected to cost the auto industry billions. According to one auto analyst with IHS Global Insight the move could raise the price of a new vehicles anywhere from $2,000 to $10,000 due to the added features (source: news.yahoo.com). This does not seem like the best idea as auto makers are already struggling to get buyers into the showrooms.
Obama also directed the Environmental Protection Agency (EPA) to review whether California and more than a dozen states should be allowed to implement tougher auto emissions standards on auto makers in an effort to reduce greenhouse gases. The states that account for roughly half of the United States total auto sales had their initiative blocked by the Bush administration (source: news.yahoo.com).
The president also said that his administration was working on regulations for fuel efficiency for all the 2011 models. This rule would be a step to ensure that the energy law passed in 2007, which requires all vehicles manufactured in the United States to be able to achieve a minimum of 35 miles per gallon by 2020, becomes a reality (source: news.yahoo.com).
Environmentalists praised Obama’s regulations and stated that the fuel saving of the greener cars would save the consumer around $2,000 for the life of the vehicle. While this may not replace the entire upfront cost, it would help to offset it. Environmentalists also fear that without such regulations put into place and enforced that eventually Detroit will go back to its gas guzzling ways (source: news.yahoo.com).
While the initiative of the new president is appreciated it may just fall on deaf ears. Again, consumers are not going into the dealerships now to buy vehicles at the prices they are currently at. Even though the greener cars would be more appealing, they may lose their luster greatly with the added cost to the bottom line. As much as someone wants that flashy new “green car”, they may change their mind quickly when they realize what it is going to cost them. While the president may have the best of intentions with this plan, it may end up back-firing.