Auto Industry Will Push for Rollback of Fuel Economy Regulations

Auto Industry Will Push for Rollback of Fuel Economy Regulations

Auto Industry Will Push for Rollback of Fuel Economy Regulations


FoMoCo (NYSE:F) plans to push President Elect Donald Trump to soften US and state fuel-economy rules that hurt profits by forcing automakers to build more EV’s (electric cars) and hybrids than are warranted by customer demand.

In Y 2008, there were 12 EVs offered in the US market and it represented 2.3% of the industry, in Y 2016, there’s 55 models, the market is 2.8%.

This is not a formula for success.

“At the end of the day, you have got to have customers, so obviously, there would be pressure on the business if there’s not a market,” Mark Fields, Ford’s CEO said.

In Y 2011 when Ford and other automakers agreed with US President Barack Hussein Obama to 2X average fuel economy that’s now projected at 50.8 mpg by Y 2025 and to work with California to sell more Zero-emission cars, the companies counted on a mid-term review starting this year to see if the rules were working out as planned.

But the Environmental Protection Agency (EPA) made a preliminary determination last Wednesday that there is no need to change the Y 2025 targets.

In Friday’s interview, Mr. Fields warned that the agency’s action will disrupt the planned mid-term review.

“What happened was through 11th-hour politics, it short-circuited a data-driven development of regulations,” he said.

Mr. Fields said Ford would now turn to Donald Trump to continue the dialog as planned.

Despite the regulatory uncertainty, Mr. Fields said Ford has made no change in its plan to invest an additional $4.5-B in EVs by Y 2020, and to install this technology in 40% of its vehicles.

Ford wants to continue to help boost fuel economy and lessen the industry’s environmental impact Mr. Fields said.

HeffX-LTN Analysis for F: Overall Short Intermediate Long
Neutral (0.21) Bullish (0.35) Neutral (0.23) Neutral (0.03)

Have a terrific weekend.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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