Corporate Average Fuel Economy Essay

600 words - 2 pages

Corporate Average Fuel Economy

     The foreshadowed Market Failures of the mid 1970's gave way to Corporate
Average Fuel Economy, regulation which would call for new standards in
automobile fuel efficiency. The market failures hinged on a number of outside
variables which could have had a drastic effect on domestic markets.

     Resource Scarcity drove the American public to call for a more efficient
means of managing its resource use due to a) oil embargos on nondomestic
products and b) skyhigh prices at the pump.

     Conservation of the world's non-renewable resources cams to the
foreground with a) higher pump prices and b) forecasted resource
expenditure before the year 2000.

     With Corporate Average Fuel Economy in place the market failures should
be partially alleviated and pressures due to restricted international
resources should subside. The regulated fuel efficiency should allow the
market to resume its national flow and regain stability without further

     Reliance on imported fuels would be minimized because of the a)
decreased demand for fuel consumption and b) lowered fuel demand
allowed for domestic producers to meet the basic needs of the public.

     Maximum fuel efficiency would a) cut the amount of fuel consumption thus
nullifying high pump prices and b) raise the level of conservation by
lowering the amount consumed.

     Although the intentions of Corporate Average Fuel Economy in the 1970's
was thought to be a cure-all but, over the long run it has turned out to be a
flop. The variables on which it was based, turned out to be almost exactly

     Lower Gas Prices have a) caused the public to simply use more fuel, b)
drive more frequently due to less fuel consumption and c) look beyond
fuel economy when in the market for a new vehicle.

     Quality Depletion of the total domestic car fleet due to special
attention to only the fuel economy while ignoring: 1) performance, 2)
acceleration and 3) handling.

***     With CAFE becoming a long-term flop, in its...

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