The Automobile Industry is a very broad umbrella of cars that range of American made, Japanese/Korean made, to German and other European countries; all of which have different subtext to how they’re race for higher gas mileage began.  Much of the reasoning similar in all camps is the push by their perspective governments to create automobiles with higher and higher miles per gallon capabilities in this 21st century of ‘greener’ expectations.  These pushes are very much by administrations around the globe, including the past two American presidents’ administrations, to pressure auto industries to adhere to higher standards in the coming years (1) as crude oil prices continue to climb higher and higher. As Rick Newman states, “It’s usually a bad idea for Washington to tell companies what to sell, or consumers what to buy. But every now and then, government mandates accidentally do some good.” 

That is the reason why automakers are doing as much as they can to compete for cars to achieve higher gas mileage.  I hesitantly agree with the positive look on these mandates, as the reason for such high crude oil cost is dictated in part due to governmental tax rates rising higher across the globe, intervention in the epicenter of world oil production by the world’s elite, and continuing inflation on the dollar and other currencies due to monetary policy (of course the demand by consumers will always be apart of the equation).  Therefore the push for 54 mpg highway comes off as a bit deceptive in my eye (2).

Nevertheless, these actions have spurred competition between the world’s automakers and have, so far, produced successful results.  How they have done so is quite impressive, as they have covered creating new technology as well as revamp old tested autos as well; from hybrids to full electric cars, as well as downsizing traditional gas engines (Ford’s Mustang creating a v6 alternative) as well as tweek clean-burning Diesel engines that produce up to 56 miles per gallon (German efficiency, right?  Thank Volkswagen & Audi) (3).  The change is a welcome one, as consumer prices seem to keep rising with no drop in sight.

Will this trend last?  Depends.  The success of a minimum gas mileage being higher is apparent and so far successful with consumers of new cars…but the true electric cars still struggle to sell across the United States.  Only time will tell in stronger economic conditions whether these new cars will be accepted….but that is only a portion of the whole pie in which the rescued automakers produce to compete with stronger German and Japanese markets; it is up to GM and Crysler, specifically to still remain competitive while abiding to the taxpayer’s loan and the arbiters (aka the president and his cabinet) wishes for their cars.

Sources

1)  http://www.usnews.com/news/blogs/rick-newman/2012/08/27/tough-government-gas-mileage-rules-good-for-drivers-auto-industry

2) http://www.nytimes.com/2011/07/29/business/carmakers-back-strict-new-rules-for-gas-mileage.html?pagewanted=all

3) http://online.wsj.com/article/SB10001424127887324595704578239812708897212.html