Bush leaves fuel economy rules for Obama

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Automakers say delaying implementation of new standards will cost them

WASHINGTON - The Bush administration said Wednesday it won't finish implementing new vehicle fuel-efficiency rules, leaving the issue to the incoming Obama administration.The Transportation Department said in a statement that the recent financial problems of automakers will require the next administration "to conduct a thorough review of matters affecting the industry."

The auto industry was swift to criticize the decision, saying any delay could cost them money.

"I think that all along manufacturers have said we need certainty. .... Anything that delays that makes it more difficult," said Charles Territo, a spokesman for the Alliance of Automobile Manufacturers. "We had expected that these rules would have been finalized last year."

The department is required under a law enacted in 2007 to set rules by April 1, 2009 for how automakers are to meet new fuel economy standards.

Last spring, the current administration said the next generation of new cars and trucks should be required to meet a fleet average of 31.6 miles per gallon by 2015. The requires that by 2020 new cars and trucks meet 35 mpg, a 40 percent increase over current standards.

Territo said it will cost the industry an estimated $47 billion to comply with the standards.

"There's no question that this rule will come with a significant cost to manufacturers," Territo said.

General Motors Corp. and Chrysler LLC are struggling to survive and have received a federal bailout.

The implementation plan proposed by President Bush was expected to save nearly 55 billion gallons of oil and reduce carbon dioxide emissions by 521 million metric tons over the life of the new vehicles built between 2011-2015. It would add an average cost of $650 per passenger car and $979 per truck by 2015.

Environmental groups and their allies in Congress, who had been critical of Bush's past opposition to higher fuel economy standards, had responded favorably to the administration's plan.

In the past, automakers have fiercely opposed increases in fuel economy standards, but in 2007 they supported a compromise that helped lead to the passage of a massive energy bill. The law requires the auto industry to implement more than half of the fuel-efficiency requirements by 2015 and pushes them to build more gas-electric hybrid cars and diesel-powered trucks and SUVs.