Price of Gas

CAFE and You, Part 1 - the history of CAFE

This is the first of a multi-part series on the Corporate Average Fuel Economy standard and how it affects American automotive, for good or ill. This part looks at the storied history of CAFE, which was born as a tribute to unintended consequences and continued meddling.

The Corporate Average Fuel Economy (CAFE) standard is a law which requires automakers to produce vehicles that meet a specific standard of fuel economy for a given year. Put simply, if the CAFE requirement is 30mpg, then the fleet sales for an automaker must have a total average miles per gallon of 30 or face fines. On its surface, that is what CAFE does, but digging a little deeper, we see that it does a lot more than just that.

CAFE is responsible for the creation of the SUV and its eventual dominant market position and for the creation of today's crossover, which is now beginning to dominate the marketplace. It's also, inadvertently, the reason that pickup truck sales are high. In this short series of articles, we'll find out why one law of economics, "You cannot change just one thing," holds true and that every action has reactions, many of which will be unintended.

How CAFE Began
The history of CAFE begins in the 1950s as oil begins to become of dominant concern, post World War II. The Cold War fomented many battles where neither antagonist fired a shot, but in which gallons of blood were spilled in the Middle East as East and West fought for control of the oil fields. Eventually, this gave rise to the Organization of Petroleum Exporting Countries (OPEC), as nations split by many ideologies, banded together in an effort to shake off their oil-obsessed masters.


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The EPAs mandate was to end dependence on foreign oil? Really, if such was it's intent, it never got anywhere near achieving it.
The original arguments for creating and the original mandate from Congress that ultimately did create the EPA (and then CAFE) were to "end dependence on foreign oil." Back then, "foreign oil" was the boogeyman of the day, whereas today it's "terrorism."