3. Minimum Domestic Passenger Car Standards
    EISA expressly requires each manufacturer to meet a minimum fuel
economy standard for domestically manufactured passenger cars in
addition to meeting the standards set by NHTSA. According to the
statute (49 U.S.C. 32902(b)(4)) the minimum standard shall be the
greater of (A) 27.5 miles per gallon; or (B) 92 percent of the average
fuel economy projected by the Secretary for the combined domestic and
non-domestic passenger automobile fleets manufactured for sale in the
United States by all manufacturers in the model year. The agency must
publish the projected minimum standards in the Federal Register when
the passenger car standards for the model year in question are
promulgated.
    As published in the MY 2011 final rule, the domestic minimum
passenger car standard for MY 2011 was set at 27.8 mpg, which
represented 92 percent of the final projected passenger car standards
promulgated for that model year.\697\ NHTSA stated at the time that
``The final calculated minimum standards will be updated to reflect any
changes in the projected passenger car standards.'' \698\ Subsequently,
in the NPRM proposing the MYs 2012-2016 standards, NHTSA noted that
given changes in the projected estimated required passenger car
standard for MY 2011,\699\ 92 percent of that standard would be 28.0
mpg, not 27.8 mpg, and proposed to raise the minimum domestic passenger
car standard accordingly.
---------------------------------------------------------------------------

    \697\ See 74 FR at 14410 (Mar. 30, 3009).
    \698\ Id.
    \699\ Readers should remember, of course, that the ``estimated
required standard'' is not necessarily the ultimate mpg level with
which manufacturers will have to comply, because the ultimate mpg
level for each manufacturer is determined at the end of the model
year based on the target curves and the mix of vehicles that each
manufacturer has produced for sale. The mpg level designated as
``estimated required' is exactly that, an estimate.
---------------------------------------------------------------------------

    The Alliance commented to the NPRM that the minimum domestic
passenger car standard is subject to the 18-month lead time rule for
standards per 49 U.S.C. per 49 U.S.C. 32902(a), and that NHTSA
therefore cannot revise it at this time. Toyota individually offered
identical comments.
    49 U.S.C. 32902(b)(4)(B) does state that the minimum domestic
passenger car standard shall be 92 percent of the projected average
fuel economy for the passenger car fleet, ``which projection shall be
published in the Federal Register when the standard for that model year
is promulgated in accordance with this section.'' In reviewing the
statute, the agency concurs that the minimum domestic passenger car
standard should be based on the agency's fleet assumptions when the
passenger car standard for that year is promulgated, which would make
it inappropriate to change the minimum standard for MY 2011 at this
time. However, we note that we do not read this language to preclude
any change in the minimum standard after it is first promulgated for a
model year. As long as the 18-month lead-time requirement of 49 U.S.C.
32902(a) is respected, NHTSA believes that the language of the statute
suggests that the 92 percent should be determined anew any time the
passenger car standards are revised.
    The Alliance also commented that the minimum domestic passenger car
standard should be based on the projected ``actual'' (NHTSA refers to
this as ``estimated achieved'') mpg level for the combined passenger
car fleet, rather than based on the projected ``target'' mpg level
(NHTSA refers to this as ``estimated required'') for the combined
fleet. The Alliance argued that the plain language of the statute
states that 92 percent should be taken of the ``average fuel economy
projected * * * for the combined * * * fleets,'' which is different
than the average fuel economy standard projected. The Alliance further
argued that using the ``estimated achieved'' value to determine the 92
percent will avoid inadvertently ``considering'' FFV credits in setting
the minimum standard, since the ``estimated achieved'' value is
determined by ignoring FFV credits. Toyota individually offered
identical comments.
    NHTSA disagrees that the minimum standard should be based on the
estimated achieved levels rather than the estimated required levels.
NHTSA interprets Congress' reference in the second clause of
32902(b)(4)(B) to the standard promulgated in that model year as
indicating that Congress intended ``projected average fuel economy'' in
the first clause to pertain to the estimated required level, not the
estimated achieved level. The Alliance's concern that a minimum
standard based on the estimated required level ``inadvertently
considers'' FFV credits is misplaced, because NHTSA is statutorily
prohibited from considering FFV credits in setting maximum feasible
standards. Thus, NHTSA has continued to determine the minimum domestic
passenger car standard based on the estimated required mpg levels
projected for the model years covered by the rulemaking.
    Based on NHTSA's current market forecast, the agency's estimates of
these minimum standards under the final MY 2012-2016 CAFE standards
(and, for comparison, the final MY 2011 minimum domestic passenger car
standard) are summarized below in Table IV.E.3-1.

 Table IV.E.3-1--Estimated Minimum Standard for Domestically Manufactured Passenger Cars Under Final MY 2011 and
                              Final MY 2012-2016 CAFE Standards for Passenger Cars
----------------------------------------------------------------------------------------------------------------
       2011               2012               2013               2014               2015               2016
----------------------------------------------------------------------------------------------------------------
           27.8               30.7               31.4               32.1               33.3               34.7
----------------------------------------------------------------------------------------------------------------

4. Light Truck Standards
    For light trucks, NHTSA proposed CAFE standards defined by the
following coefficients during MYs 2012-2016:

        Table IV.E.4-1--Coefficients Defining Proposed MY 2012-2016 Fuel Economy Targets for Light Trucks
----------------------------------------------------------------------------------------------------------------
           Coefficient                 2012            2013            2014            2015            2016
----------------------------------------------------------------------------------------------------------------
a (mpg).........................      29.44           30.32           31.30           32.70           34.38
b (mpg).........................      22.06           22.55           23.09           23.84           24.72
c (gpm/sf)......................       0.0004546       0.0004546       0.0004546       0.0004546       0.0004546
d (gpm).........................       0.01533         0.01434         0.01331         0.01194         0.01045
----------------------------------------------------------------------------------------------------------------

    After updating inputs to its analysis, and revisiting the form and
stringency of both passenger cars and light truck standards, as
discussed in Section II, NHTSA is finalizing light truck CAFE standards
defined by the following coefficients during MYs 2012-2016:

         Table IV.E.4-2--Coefficients Defining Final MY 2012-2016 Fuel Economy Targets for Light Trucks
----------------------------------------------------------------------------------------------------------------
           Coefficient                 2012            2013            2014            2015            2016
----------------------------------------------------------------------------------------------------------------
a (mpg).........................      29.82           30.67           31.38           32.72           34.42
b (mpg).........................      22.27           22.74           23.13           23.85           24.74
c (gpm/sf)......................       0.0004546       0.0004546       0.0004546       0.0004546       0.0004546
d (gpm).........................       0.014900        0.013968        0.013225        0.011920        0.010413
----------------------------------------------------------------------------------------------------------------

    As for passenger cars, these coefficients reflect the agency's
decision, discussed above in Section II, to leave the shapes of both
the passenger car and light truck curves unchanged. They also reflect
the agency's reevaluation of the ``gap'' in stringency between the
passenger car and light truck standard, also discussed in Section II.
    These coefficients result in the footprint-dependent targets shown
graphically below. The MY 2011 final standard, which is specified by a
constrained logistic function rather than a constrained linear
function, is shown for comparison.

[GRAPHIC] [TIFF OMITTED] TR07MY10.035

    Again, given these targets, the CAFE levels required of individual
manufacturers will depend on the mix of vehicles they produce for sale
in the United States. Based on the market forecast NHTSA has used to
examine today's final CAFE standards, the agency estimates that the
targets shown above will result in the following average required fuel
economy levels for individual manufacturers during MYs 2012-2016 (an
updated estimate of the average required fuel economy level under the
final MY 2011 standard is shown for comparison): \700\
---------------------------------------------------------------------------

    \700\ In the March 2009 final rule establishing MY 2011
standards for passenger cars and light trucks, NHTSA estimated that
the required fuel economy levels for light trucks would average 24.1
mpg under the MY 2011 light truck standard. Based on the agency's
current forecast of the MY 2011 light truck market, NHTSA now
estimates that the required fuel economy levels will average 24.4
mpg in MY 2011. The increase in the estimate reflects a decrease in
the size of the average light truck.

           Table IV.E.4-3--Estimated Average Fuel Economy Required Under Final MY 2011 and Final MY 2012-2016 CAFE Standards for Light Trucks
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Manufacturer                            MY 2011         MY 2012         MY 2013         MY 2014         MY 2015         MY 2016
--------------------------------------------------------------------------------------------------------------------------------------------------------
BMW.....................................................            25.6            26.6            27.3            27.9            28.9            30.2
Chrysler................................................            24.5            25.7            26.2            26.8            27.8            29.0
Daimler.................................................            24.7            25.6            26.3            26.9            27.8            29.1
Ford....................................................            23.7            24.8            25.4            26.0            27.0            28.1
General Motors..........................................            23.3            24.2            24.8            25.2            26.1            27.2
Honda...................................................            25.7            26.9            27.5            28.0            29.1            30.4
Hyundai.................................................            25.9            27.0            27.6            28.2            29.3            30.7
Kia.....................................................            25.2            26.2            26.7            27.3            28.3            29.5
Mazda...................................................            26.2            27.6            28.4            28.9            30.1            31.5
Mitsubishi..............................................            26.4            27.8            28.5            29.1            30.2            31.7
Nissan..................................................            24.5            25.6            26.2            26.8            27.8            29.1
Porsche.................................................            25.5            26.3            26.9            27.5            28.5            29.8
Subaru..................................................            26.5            27.9            28.6            29.2            30.4            31.9
Suzuki..................................................            26.3            27.5            28.2            28.8            29.9            31.4
Tata....................................................            26.2            27.4            28.2            28.8            29.9            31.3
Toyota..................................................            24.6            25.7            26.2            26.8            27.8            29.1

Volkswagen..............................................            25.0            25.8            26.4            27.0            28.0            29.2
Average.................................................            24.4            25.4            26.0            26.6            27.5            28.8
--------------------------------------------------------------------------------------------------------------------------------------------------------

    As discussed above with respect to the final passenger cars
standards, we note that a manufacturer's required fuel economy level
for a model year under the final standards will be based on its actual
production numbers in that model year.

F. How do the final standards fulfill NHTSA's statutory obligations?

    In developing the proposed MY 2012-16 standards, the agency
developed and considered a wide variety of alternatives. In response to
comments received in the last round of rulemaking, in our March 2009
notice of intent to prepare an environmental impact statement, the
agency selected a range of candidate stringencies that increased
annually, on average, 3% to 7%.\701\ That same approach has been
carried over to this final rule and to the accompanying FEIS and FRIA.
Thus, the majority of the alternatives considered in this rulemaking
are defined as average percentage increases in stringency--3 percent
per year, 4 percent per year, 5 percent per year, and so on. NHTSA
believes that this approach clearly communicates the level of
stringency of each alternative and allows us to identify alternatives
that represent different ways to balance NHTSA's statutory requirements
under EPCA/EISA.
---------------------------------------------------------------------------

    \701\ Notice of intent to prepare an EIS, 74 FR 14857, 14859-60,
April 1, 2009.
---------------------------------------------------------------------------

    In the NPRM, we noted that each of the listed alternatives
represents, in part, a different way in which NHTSA could conceivably
balance different policies and considerations in setting the standards.
We were mindful that the agency needs to weigh and balance many
factors, such as technological feasibility, economic practicability,
including lead time considerations for the introduction of technologies
and impacts on the auto industry, the impacts of the standards on fuel
savings and CO2 emissions, and fuel savings by consumers, as
well as other relevant factors such as safety. For example, the 7%
Alternative weighs energy conservation and climate change
considerations more heavily and technological feasibility and economic
practicability less heavily. In contrast, the 3% Alternative, the least
stringent alternative, places more weight on technological feasibility
and economic practicability. We recognized that the ``feasibility'' of
the alternatives also may reflect differences and uncertainties in the
way in which key economic (e.g., the price of fuel and the social cost
of carbon) and technological inputs could be assessed and estimated or
valued. We also recognized that some technologies (e.g., PHEVs and EVs)
will not be available for more than limited commercial use through MY
2016, and that even those technologies that could be more widely
commercialized through MY 2016 cannot all be deployed on every vehicle
model in MY 2012 but require a realistic schedule for more widespread
commercialization to be within the realm of economically
practicability.
    In addition to the alternatives that increase evenly at annual
rates ranging from 3% to 7%, NHTSA also included alternatives developed
using benefit-cost criteria. The agency emphasized benefit-cost-related
alternatives in its rulemakings for MY 2008-2011 and, subsequently, MY
2011 standards. By including such alternatives in its current analysis,
the agency is providing a degree of analytical continuity between the
two approaches to defining alternatives in an effort to illustrate the
similarities and dissimilarities. To that end, we included and analyzed
two additional alternatives, one that sets standards at the point where
net benefits are maximized (labeled ``MNB'' in the table below), and
another that sets standards at the point at which total costs are most
nearly equal to total benefits (labeled ``TCTB'' in the table
below).\702\ With respect to the first of those alternatives, we note
that Executive Order 12866 focuses attention on an approach that
maximizes net benefits. Further, since NHTSA has thus far set
attribute-based CAFE standards at the point at which net benefits are
maximized, we believed it would be useful and informative to consider
the potential impacts of that approach as compared to the new approach
for MYs 2012-2016.
---------------------------------------------------------------------------

    \702\ The stringency indicated by each of these alternatives
depends on the value of inputs to NHTSA's analysis. Results
presented here for these two alternatives are based on NHTSA's
reference case inputs, which underlie the central analysis of the
proposed standards. In the accompanying FRIA, the agency presents
the results of that analysis to explore the sensitivity of results
to changes in key economic inputs. Because of numerous changes in
model inputs (e.g., discount rate, rebound effect, CO2
value, technology cost estimates), our analysis often exhausts all
available technologies before reaching the point at which total
costs equal total benefits. In these cases, the stringency that
exhausts all available technologies is considered.
---------------------------------------------------------------------------

    After working with EPA in thoroughly reviewing and in some cases
reassessing the effectiveness and costs of technologies (most of which
are already being incorporated in at least some vehicles), market
forecasts and economic assumptions, NHTSA used the Volpe model
extensively to assess the technologies that the manufacturers could
apply in order to comply with each of the alternatives. This allowed us
to assess the variety, amount and cost of the technologies that could
be used to enable the manufacturers to comply with each of the
alternatives. NHTSA estimated how the application of these and other
technologies could increase vehicle costs, reduce fuel consumption, and
reduce CO2 emissions.
    The agency then assessed which alternative would represent a
reasonable balancing of the statutory criteria, given the difficulties
confronting the industry and the economy, and other relevant goals and
priorities. Those priorities and goals include maximizing energy
conservation and achieving a nationally harmonized and coordinated
program for regulating fuel economy and GHG emissions.
    Part of that assessment of alternatives entailed an evaluation of
the stringencies necessary to achieve both Federal and State GHG
emission reduction goals, especially those of California and the States
that have adopted its GHG emission standard for motor vehicles. Given
that EPCA requires attribute-based standards, NHTSA and EPA determined
the level at which a national attribute-based GHG emissions standard
would need to be set to achieve the same emission reductions in
California as the California GHG program. This was done by evaluating a
nationwide Clean Air Act standard for MY 2016 that would apply across
the country and require the levels of emissions reduction which
California standards would require for the subset

of vehicles sold in California under the California standards for MY
2009-2016 (known as ``Pavley 1''). In essence, the stringency of the
California Pavley 1 program was evaluated, but for a national standard.
For a number of reasons discussed in Section III.D, an assessment was
developed of national new vehicle fleet-wide CO2 performance
standards for model year 2016 which would result in the new light-duty
vehicle fleet in the State of California having CO2
performance equal to the performance from the California Pavley 1
standards. That level, 250 g/mi, is equivalent to 35.5 mpg if the GHG
standard were met exclusively by fuel economy improvements--and the
overall result is the model year 2016 goals of the National Program.
    However, the level of stringency for the National Program goal of
250 g/mi CO2 can be met with both fuel economy ``tailpipe''
improvements as well as other GHG-reduction related improvements, such
as A/C refrigerant leakage reductions. CAFE standards, as discussed
elsewhere in this final rule, cannot be met by improvements that cannot
be accounted for on the FTP/HFET tests. Thus, setting CAFE standards at
35.5 mpg would require more tailpipe technology (at more expense to
manufacturers) than would be required under such a CAA standard. To
obtain an equivalent CAFE standard, we determined how much tailpipe
technology would be necessary in order to meet an mpg level of 35.5 if
manufacturers also employed what EPA deemed to be an average amount of
A/C ``credits'' (leakage and efficiency) to reach the 250 g/mi
equivalent. This results in a figure of 34.1 mpg as the appropriate
counterpart CAFE standard. This differential gives manufacturers the
opportunity to reach 35.5 mpg equivalent under the CAA in ways that
would significantly reduce their costs. Were NHTSA instead to establish
its standard at the same level, manufacturers would need to make
substantially greater expenditures on fuel-saving technologies to reach
35.5 mpg under EPCA.
    Thus, as part of the process of considering all of the factors
relevant under EPCA for setting standards, in a context where achieving
a harmonized National Program is important, for the proposal we created
a new alternative whose annual percentage increases would achieve 34.1
mpg by MY 2016. That alternative is one which increases on average at
4.3% annually. This new alternative, like the seven alternatives
presented above, represents a unique balancing of the statutory factors
and other relevant considerations. For the reader's reference, the
estimated required levels of stringency for each alternative in each
model year are presented below:
---------------------------------------------------------------------------

    \703\ Also, the ``MNB'' and the ``TCTB'' alternatives depend on
the inputs to the agencies' analysis. The sensitivity analysis
presented in the FRIA documents the response of these alternatives
to changes in key economic inputs. For example, the combined average
required fuel economy under the ``MNB'' alternative is 36.9 mpg
under the reference case economic inputs presented here, and ranges
from 33.7 mpg to 37.2 mpg under the alternative economic inputs
presented in the FRIA. See Table X-14 in the FRIA.

                                  Table IV.F-1--Estimated Required Fuel Economy Level for Regulatory Alternatives \703\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                        Alt. 1       Alt. 2       Alt. 3       Alt. 4       Alt. 5       Alt. 6       Alt. 7       Alt. 8       Alt. 9
                                    --------------------------------------------------------------------------------------------------------------------
                                                                                ~6.0%/year                             ~6.6%/year
                                      No action     3%/year      4%/year     ~4.3%/year    5%/year      increase     6%/year      7%/year      increase
                                                    increase     increase     increase     increase       MNB        increase     increase       TCTB
--------------------------------------------------------------------------------------------------------------------------------------------------------
2012:
Passenger Cars.....................         30.5         31.7         32.1         33.3         32.4         33.0         32.7         33.0         33.4
Light Trucks.......................         24.4         24.1         24.4         25.4         24.6         26.3         24.9         25.1         26.3
                                    --------------------------------------------------------------------------------------------------------------------
    Combined.......................         27.8         28.3         28.6         29.7         28.8         30.0         29.1         29.4         30.3
2013:
Passenger Cars.....................         30.5         32.6         33.3         34.2         33.9         36.1         34.5         35.2         36.7
Light Trucks.......................         24.4         24.8         25.3         26.0         25.8         27.7         26.3         26.8         28.0
                                    --------------------------------------------------------------------------------------------------------------------
    Combined.......................         27.8         29.1         29.7         30.5         30.3         32.3         30.8         31.4         32.8
2014:
Passenger Cars.....................         30.5         33.5         34.5         34.9         35.5         38.1         36.5         37.6         39.2
Light Trucks.......................         24.5         25.5         26.3         26.6         27.0         29.1         27.8         28.6         29.7
                                    --------------------------------------------------------------------------------------------------------------------
    Combined.......................         28.0         30.0         30.9         31.3         31.8         34.2         32.7         33.7         35.0
2015:
Passenger Cars.....................         30.5         34.4         35.8         36.2         37.1         39.4         38.6         40.1         40.7
Light Trucks.......................         24.4         26.2         27.2         27.5         28.3         30.3         29.4         30.5         30.7
                                    --------------------------------------------------------------------------------------------------------------------
    Combined.......................         28.0         31.0         32.2         32.6         33.4         35.6         34.7         36.0         36.5
2016:
Passenger Cars.....................         30.5         35.4         37.2         37.8         39.0         40.9         40.9         42.9         42.3
Light Trucks.......................         24.4         27.0         28.3         28.8         29.7         31.1         31.1         32.6         31.8
                                    --------------------------------------------------------------------------------------------------------------------
    Combined.......................         28.1         32.0         33.6         34.1         35.2         36.9         36.9         38.7         38.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The following figure presents this same information but in a
different way, comparing estimated average fuel economy levels required
of manufacturers under the eight regulatory alternatives in MYs 2012,
2014, and 2016. Required levels for MY 2013 and MY 2015 fall between
those for MYs 2012 and 2014 and MYs 2014 and 2016, respectively.
Although required levels for these interim years are not presented in
the following figure to limit the complexity of the figure, they do
appear in the accompanying FRIA.

[GRAPHIC] [TIFF OMITTED] TR07MY10.036

    As this figure illustrates, the final standards involve a ``faster
start'' toward increased stringency than do any of the alternatives
that increase steadily (i.e., the 3%/y, 4%/y, 5%/y, 6%/y, and 7%/y
alternatives). However, by MY 2016, the stringency of the final
standards reflects an average annual increase of 4.3%/y. The final
standards, therefore, represent an alternative that could be referred
to as ``4.3% per year with a fast start'' or a ``front-loaded 4.3%
average annual increase.''
    For each alternative, including today's final standards, NHTSA has
estimated all corresponding effects for each model year, including fuel
savings, CO2 reductions, and other effects, as well as the
estimated societal benefits of these effects. The accompanying FRIA
presents a detailed analysis of these results. Table IV.F-2 presents
fuel savings, CO2 reductions, and total industry cost
outlays for model year 2012--2016 for the eight alternatives.

          Table IV.F-2--Fuel Savings, CO2 Reductions, and Technology Costs for Regulatory Alternatives
----------------------------------------------------------------------------------------------------------------
                                                                                CO2
                     Regulatory alternative                        Fuel savings     reductions       Cost ($b)
                                                                     (b. gal)          (mmt)
----------------------------------------------------------------------------------------------------------------
3% per Year.....................................................              34             373              23
4% per Year.....................................................              50             539              39
Final (4.3% per Year)...........................................              61             655              52
5% per Year.....................................................              68             709              63
6% per Year.....................................................              82             840              90
Maximum Net Benefit.............................................              90             925             103
7% per Year.....................................................              93             945             111
Total Cost = Total Benefit......................................              96             986             114
----------------------------------------------------------------------------------------------------------------

    As noted earlier, NHTSA has used the Volpe model to analyze each of
these alternatives based on analytical inputs determined jointly with
EPA. For a given regulatory alternative, the Volpe model estimates how
each manufacturer could apply technology in response to the MY 2012
standard (separately for cars and trucks), carries technologies

applied in MY 2012 forward to MY 2013, and then estimates how each
manufacturer could apply technology in response to the MY 2013
standard. When analyzing MY 2013, the model considers the potential to
add ``extra'' technology in MY 2012 in order to carry that technology
into MY 2013, thereby avoiding the use of more expensive technologies
in MY 2013. The model continues in this fashion through MY 2016, and
then performs calculations to estimate the costs, effects, and benefits
of the applied technologies, and to estimate any civil penalties owed
based on projected noncompliance. For each regulatory alternative, the
model calculates incremental costs, effects, and benefits relative to
the regulatory baseline (i.e., the no-action alternative), under which
the MY 2011 CAFE standards continue through MY 2016. The model
calculates results for each model year, because EPCA requires that
NHTSA set its standards for each model year at the ``maximum feasible
average fuel economy level that the Secretary decides the manufacturers
can achieve in that model year'' considering four statutory factors.
Pursuant to EPCA's requirement that NHTSA not consider statutory
credits in establishing CAFE standards, NHTSA did not consider FFV
credits, credits carried forward and backward, and transferred credits
in this calculation 704, 705 In addition, the analysis
incorporates fines for some manufacturers that have traditionally paid
fines rather than comply with the standards. Because it entails year-
by-year examination of eight regulatory alternatives for, separately,
passenger cars and light trucks, NHTSA's analysis involves a large
amount of information. Detailed results of this analysis are presented
separately in NHTSA's FRIA.
---------------------------------------------------------------------------

    \704\ NHTSA has conducted a separate analysis, discussed above
in Section I, which accounts for EPCA's provisions regarding FFVs.
    \705\ For a number of reasons, the results of this modeling
differ from EPA's for specific manufacturers, fleets, and model
years. These reasons include representing every model year
explicitly, accounting for estimates of when vehicle model redesigns
will occur, and not considering those compliance flexibilities where
EPCA forbids such consideration in setting CAFE standards. It should
be noted, however, that these flexibilities in fact provide
manufacturers significant latitude to manage their compliance
obligations.
---------------------------------------------------------------------------

    In reviewing the results of the various alternatives, NHTSA
confirmed that progressive increases in stringency require
progressively greater deployment of fuel-saving technology and
corresponding increases in technology outlays and related costs, fuel
savings, and CO2 emission reductions. To begin, NHTSA
estimated total incremental outlays for additional technology in each
model year. The following figure shows cumulative results for MYs 2012-
2016 for industry as a whole and Chrysler, Ford, General Motors, Honda,
Nissan, and Toyota. This figure focuses on these manufacturers as they
currently (in MY 2010) represent three large U.S.-headquartered and
three large foreign-headquartered full-line manufacturers.
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[GRAPHIC] [TIFF OMITTED] TR07MY10.037

    As part of the incremental technology outlays, NHTSA also analyzes
which technologies manufacturers could apply to meet the standards. In
NHTSA's analysis, manufacturers achieve compliance with the fuel
economy levels through application of technology rather than through
changes in the mix of vehicles produced for sale in the U.S. The
accompanying FRIA presents detailed estimates of additional technology
penetration into the NHTSA reference fleet associated with each
regulatory alternative. The following four charts illustrate the
results of this analysis, considering the application of four
technologies by six manufacturers and by the industry as a whole.
Technologies include gasoline direct injection (GDI), engine
turbocharging and downsizing, diesel engines, and strong HEV systems
(including CISG systems). GDI and turbocharging are presented because
they are among the technologies that play an important role in
achieving the fuel economy improvements shown in NHTSA's analysis, and
diesels and strong HEVs are presented because they represent
technologies involving significant cost and related lead time
challenges for widespread use through MY 2016. These figures focus on
Chrysler, Ford, General Motors, Honda, Nissan, and Toyota, as above.
For each alternative, the figures show additional application of
technology by MY 2016.\706\
---------------------------------------------------------------------------

    \706\ The FRIA presents results for all model years,
technologies, and manufacturers, and NHTSA has considered these
broader results when considering the eight regulatory alternatives.
---------------------------------------------------------------------------

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[GRAPHIC] [TIFF OMITTED] TR07MY10.038

[GRAPHIC] [TIFF OMITTED] TR07MY10.039

[GRAPHIC] [TIFF OMITTED] TR07MY10.040

[GRAPHIC] [TIFF OMITTED] TR07MY10.041

    The modeling analysis demonstrates that applying these
technologies, of course, results in fuel savings. Relevant to EPCA's
requirement that NHTSA consider, among other factors, economic
practicability and the need of the nation to conserve energy, the
following figure compares the incremental technology outlays and
related cost presented above for the industry to the corresponding
cumulative fuel savings.

[GRAPHIC] [TIFF OMITTED] TR07MY10.042

    These incremental technology outlays (and corresponding fuel
savings) also result in corresponding increases in incremental cost per
vehicle, as shown below. The following five figures show industry-wide
average incremental (i.e., relative to the reference fleet) per-vehicle
costs, for each model year, each fleet, and the combined fleet.
Estimates specific to each manufacturer are shown in NHTSA's FRIA.

[GRAPHIC] [TIFF OMITTED] TR07MY10.043

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BILLING CODE 6560-50-C
    As discussed in the NPRM, the agency began the process of winnowing
the alternatives by determining whether any of the lower stringency
alternatives should be eliminated from consideration. To begin with,
the agency needs to ensure that its standards are high enough to enable
the combined fleet of passenger cars and light trucks to achieve at
least 35 mpg not later than MY 2020, as required by EISA. Achieving
that level makes it necessary for the chosen alternative to increase at
over 3 percent annually. Additionally, given that CO2 and
fuel savings are very closely correlated, the 3%/y and 4%/y alternative
would not produce the reductions in fuel savings and CO2
emissions that the Nation needs at this time. Picking either of those
alternatives would unnecessarily result in foregoing substantial
benefits, in terms of fuel savings and reduced CO2
emissions, which would be achievable at reasonable cost. And finally,
neither the 3%/y nor the 4%/y alternatives would lead to the regulatory
harmonization that forms a vital core principle of the National Program
that EPA and NHTSA are jointly striving to implement. These
alternatives would give inadequate weight to other standards of the
Government, specifically EPA's and CARB's. Thus, the agency concluded
that alternatives less stringent than the proposed standards would not
yield the emissions reductions required to produce a harmonized
national program and would not produce corresponding fuel savings, and
therefore would not place adequate emphasis on the nation's need to
conserve energy. NHTSA has therefore concluded that it must reject the
3%/y and 4%/y alternatives.
    NHTSA then considered the ``environmentally-preferable''
alternative. Based on the information provided in the FEIS, the
environmentally-preferable alternative would be that involving
stringencies that increase at 7% annually.\707\ NHTSA notes that NEPA
does not require that agencies choose the environmentally-preferable
alternative if doing so would be contrary to the choice that the agency
would otherwise make under its governing statute. Given the levels of
technology and cost required by the environmentally-preferable
alternative and the lack of lead time to achieve such levels between
now and MY 2016, as discussed further below, NHTSA concludes that the
environmentally-preferable alternative would not be economically
practicable or technologically feasible, and thus concludes that it
would result in standards that would be beyond the level achievable for
MYs 2012-2016.
---------------------------------------------------------------------------

    \707\ See, e.g., FEIS, figure S-12, p. 18, which shows that 7%/y
alternative yields greatest cumulative effect on global mean
temperature.
---------------------------------------------------------------------------

    For the other alternatives, NHTSA determined that it would be
inappropriate to choose any of the other more stringent alternatives
due to concerns over lead time and economic practicability. There are
real-world technological and economic time constraints which must be
considered due to the short lead time available for the early years of
this program, in particular for MYs 2012 and 2013. The alternatives
more stringent than the final standards begin to accrue costs
considerably more rapidly than they accrue fuel savings and emissions
reductions, and at levels that are increasingly economically
burdensome, especially considering the need to make underlying
investments (e.g., for

engineering and tooling) well in advance of actual production. As shown
in Figures IV-2 to IV-6 above, while the final standards already
require aggressive application of technologies, more stringent
standards would require more widespread use (including more substantial
implementation of advanced technologies such as stoichiometric gasoline
direct injection engines, diesel engines, and strong hybrids), and
would raise serious issues of adequacy of lead time, not only to meet
the standards but to coordinate such significant changes with
manufacturers' redesign cycles. The agency maintains, as it has
historically, that there is an important distinction between
considerations of technological feasibility and economic
practicability, both of which enter into the agency's determination of
the maximum feasible levels of stringency. A given level of performance
may be technologically feasible (i.e., setting aside economic
constraints) for a given vehicle model. However, it would not be
economically practicable to require a level of fleet average
performance that assumes every vehicle will immediately (i.e., within
18 months of the rule's promulgation) perform at its highest
technologically feasible level, because manufacturers do not have
unlimited access to the financial resources or the time required to
hire enough engineers, build enough facilities, and install enough
tooling. The lead time reasonably needed to make capital investments
and to devote the resources and time to design and prepare for
commercial production of a more fuel efficient vehicle is an important
element that NHTSA takes into consideration in establishing the
standards.
    In addition, the figures presented above reveal that increasing
stringency beyond the final standards would entail significant
additional application of technology. Among the more stringent
alternatives, the one closest in stringency to the standards being
finalized today is the alternative under which combined CAFE stringency
increases at 5% annually. As indicated above, this alternative would
yield fuel savings and CO2 reductions about 11% and 8%
higher, respectively, than the final standards. However, compared to
the final standards, this alternative would increase outlays for new
technologies during MY 2012-2016 by about 22%, or $12b. Average MY 2016
cost increases would, in turn, rise from $903 under the final standards
to $1,152 when stringency increases at 5% annually. This represents a
28% increase in per-vehicle cost for only a 3% increase in average
performance (on a gallon-per-mile basis to which fuel savings are
proportional). Additionally, the 5%/y alternative disproportionally
burdens the light truck fleet requiring a nearly $400 (42 percent) cost
increase in MY 2016 compared to the final standards. The following
three tables summarize estimated manufacturer-level average incremental
costs for the 5%/y alternative and the average of the passenger and
light truck fleets:

Table IV.F-3--Average Incremental Costs ($/Vehicle) Under the 5%/y Alternative CAFE Standards for Passenger Cars
----------------------------------------------------------------------------------------------------------------
        Manufacturer              MY 2012         MY 2013          MY 2014          MY 2015          MY 2016
----------------------------------------------------------------------------------------------------------------
BMW.........................               3               4               24              184              585
Chrysler....................             734           1,303            1,462            1,653            1,727
Daimler.....................  ..............  ...............             410              801            1,109
Ford........................             743           1,245            1,261            1,583            1,923
General Motors..............             448             823            1,187            1,425            1,594
Honda.......................              50             109              271              375              606
Hyundai.....................             747             877            1,057            1,052            1,124
Kia.........................              49             128              197              261              369
Mazda.......................             555             718            1,166            1,407            1,427
Mitsubishi..................             534             507            2,534            3,213            3,141
Nissan......................             294             491              965            1,064            1,125
Porsche.....................              68             (52)             (51)             (50)             (49)
Subaru......................             292             324            1,372            1,723            1,679
Suzuki......................  ..............             959            1,267            1,316            1,540
Tata........................             111              93              183              306              710
Toyota......................              31              29               52              129              212
Volkswagen..................             145             428              477              492              783
                             -----------------------------------------------------------------------------------
    Average.................             337             540              726              886            1,053
----------------------------------------------------------------------------------------------------------------

 Table IV.F-4--Average Incremental Costs ($/Vehicle) Under the 5%/y Alternative CAFE Standards for Light Trucks
----------------------------------------------------------------------------------------------------------------
        Manufacturer              MY 2012         MY 2013          MY 2014          MY 2015          MY 2016
----------------------------------------------------------------------------------------------------------------
BMW.........................             169             160              201              453              868
Chrysler....................             360             559            1,120            1,216            1,432
Daimler.....................              60              55               51               52               51
Ford........................           1,207           1,663            1,882            2,258            2,225
General Motors..............             292             628              866              968            1,136
Honda.......................             258             234              611              750            1,047
Hyundai.....................             711             685            1,923            1,909            1,862
Kia.........................              47             293              556              782            1,157
Mazda.......................             248             408              419              519              768
Mitsubishi..................  ..............  ...............           1,037            1,189            1,556
Nissan......................             613             723            2,142            2,148            2,315
Porsche.....................  ..............              (0)              (1)             469              469
Subaru......................           1,225           1,220            1,365            1,374            1,330
Suzuki......................  ..............           1,998            1,895            1,837            2,096

Tata........................  ..............  ...............  ...............  ...............             503
Toyota......................              63             187              594              734              991
Volkswagen..................  ..............  ...............             514              458              441
                             -----------------------------------------------------------------------------------
    Average.................             415             628            1,026            1,173            1,343
----------------------------------------------------------------------------------------------------------------

Table IV.F-5--Average Incremental Costs ($/Vehicle) Under the 5%/y Alternative CAFE Standards for Passenger Cars
                                            and Light Trucks Combined
----------------------------------------------------------------------------------------------------------------
        Manufacturer              MY 2012         MY 2013          MY 2014          MY 2015          MY 2016
----------------------------------------------------------------------------------------------------------------
BMW.........................              72              64               84              265              666
Chrysler....................             499             870            1,272            1,414            1,569
Daimler.....................              20              20              281              554              773
Ford........................             914           1,407            1,498            1,838            2,034
General Motors..............             371             726            1,033            1,205            1,379
Honda.......................             135             157              396              518              769
Hyundai.....................             742             838            1,237            1,186            1,235
Kia.........................              49             168              273              355              506
Mazda.......................             500             667            1,053            1,272            1,330
Mitsubishi..................             371             352            1,973            2,386            2,506
Nissan......................             399             565            1,344            1,387            1,467
Porsche.....................              52             (39)             (35)             130              124
Subaru......................             617             628            1,369            1,597            1,553
Suzuki......................  ..............           1,134            1,381            1,404            1,630
Tata........................              61              56              101              182              629
Toyota......................              43              82              239              333              466
Volkswagen..................             117             333              486              486              723
                             -----------------------------------------------------------------------------------
    Average.................             367             573              836              987            1,152
----------------------------------------------------------------------------------------------------------------

    These cost increases derive from increased application of advanced
technologies as stringency increases past the levels in the final
standards. For example, under the final standards, additional diesel
application rates average 1.6% for the industry and range from 0% to 3%
among Chrysler, Ford, GM, Honda, Nissan, and Toyota. Under standards
increasing in combined stringency at 5% annually, these rates more than
triple, averaging 6.2% for the industry and ranging from 0% to 21% for
the same six manufacturers.
    These technology and cost increases are significant, given the
amount of lead-time between now and model years 2012-2016. In order to
achieve the levels of technology penetration for the final standards,
the industry needs to invest significant capital and product
development resources right away, in particular for the 2012 and 2013
model year, which is only 2-3 years from now. For the 2014-2016 time
frame, significant product development and capital investments will
need to occur over the next 2-3 year in order to be ready for launching
these new products for those model years. Thus a major part of the
required capital and resource investment will need to occur now and
over the next few years, under the final standards. NHTSA believes that
the final rule requires significant investment and product development
costs for the industry, focused on the next few years.
    It is important to note, and as discussed later in this preamble,
as well as in the Joint Technical Support Document and the agency's
Regulatory Impact Analysis, the average model year 2016 per-vehicle
cost increase of more than $900 includes an estimate of both the
increase in capital investments by the auto companies and the suppliers
as well as the increase in product development costs. These costs can
be significant, especially as they must occur over the next 2-3 years.
Both the domestic and transplant auto firms, as well as the domestic
and world-wide automotive supplier base, are experiencing one of the
most difficult markets in the U.S. and internationally that has been
seen in the past 30 years. One major impact of the global downturn in
the automotive industry and certainly in the U.S. is the significant
reduction in product development engineers and staffs, as well as a
tightening of the credit markets which allow auto firms and suppliers
to make the near-term capital investments necessary to bring new
technology into production.
    The agency concludes that the levels of technology penetration
required by the final standards are reasonable. Increasing the
standards beyond those levels would lead to rapidly increasing
dependence on advanced technologies with higher costs--technology that,
though perhaps technologically feasible for individual vehicle models,
would, at the scales involved, pose too great an economic burden given
the state of the industry, particularly in the early years of the
rulemaking time frame.\708\
---------------------------------------------------------------------------

    \708\ Although the final standards are projected to be slightly
more costly than the 5% alternative in MY 2012, that alternative
standard becomes progressively more costly than the final standards
in the remaining model years. See Figures IV.F.8 through IV.F.10
above. Moreover, as discussed above, after MY 2012, the 5%
alternative standard yields less incremental fuel economy benefits
at increased cost (both industry-wide and per vehicle),
directionally the less desirable result. These increased costs
incurred to increase fuel economy through MY 2016 would impose
significantly increased economic burden on the manufacturers in the
next few calendar years to prepare for these future model years. In
weighing the statutory factors, NHTSA accordingly rejected this
alternative in favor of the final standard.
---------------------------------------------------------------------------

    Therefore, the agency concluded that these more stringent
alternatives would give insufficient weight to economic practicability
and related lead time

concerns, given the current state of the industry and the rate of
increase in stringency that would be required. Overall, the agency
concluded that among the alternatives considered by the agency, the
proposed alternative contained the maximum feasible CAFE standards for
MYs 2012-2016 as they were the most appropriate balance of the various
statutory factors.
    Some commenters argued that the agency should select a more
stringent alternative than that proposed in the NPRM. The Union of
Concerned Scientists (UCS) commented that NHTSA should set standards to
produce the ``maximum environmental benefit'' available at
``reasonable'' cost, and at least at the stringency maximizing net
benefits. Students from the University of California at Santa Barbara
commented that the agency should have based standards not just on
technologies known to be available, but also on technologies that may
be available in the future--and should do so in order to force
manufacturers to ``reach'' to greater levels of performance. Also, the
Center for Biological Diversity (CBD) commented that, having conducted
an unbiased cost-benefit analysis showing benefits three times the
magnitude of costs for the proposed alternative, the agency should
select a more stringent alternative. CBD also argued that the agency
should have evaluated the extent to which manufacturers could deploy
technology more rapidly than suggested by a five-year redesign cycle.
    Conversely, other commenters argued that NHTSA should select a less
stringent alternative, either in all model years or at least in the
earlier model years. Chrysler, VW, and the Alliance of Automobile
Manufacturers commented that the stringency of NHTSA's CAFE standards
should be further reduced relative to that of EPA's GHG emissions
standards, so that manufacturers would not be required by CAFE to add
any tailpipe technology beyond what they thought would be necessary to
meet an mpg level of 35.5 minus the maximum possible A/C credits that
could be obtained under the EPA program. Also, Chrysler, Daimler,
Toyota, Volkswagen, and the Alliance argued that the agency should
reduce the rate of increase in stringency to produce steadier and more
``linear'' increases between MY 2011 and MY 2016. In addition, the
Heritage Foundation commented that the proposed standards would, in
effect, force accelerated progress toward EISA's ``35 mpg by 2020''
requirement, causing financially-stressed manufacturers to incur undue
costs that would be passed along to consumers.
    However, most commenters supported the agency's selection of the
proposed standards. The American Chemical Society, the New York
Department of Environmental Conservation, the Washington State
Department of Ecology, and several individuals all expressed general
support for the levels of stringency proposed by NHTSA as part of the
joint proposal. General Motors and Nissan both indicated that the
proposed standards are consistent with the National Program announced
by the President and supported in letters of commitment signed by these
companies' executives. Finally, the California Air Resources Board
(CARB) strongly supported the stringency of the proposed standards, as
well as the agencies' underlying technical analysis and weighing of
statutory factors. CARB further commented that the stringency increases
in the earlier model years are essential to providing environmental
benefits at least as great as would be achieved through state-level
enforcement of CARB's GHG emissions standards.\709\
---------------------------------------------------------------------------

    \709\ Generally speaking, the cumulative benefits (in terms of
fuel savings and GHG reductions) of front-loaded standards will be
greater than standards that increase linearly.
---------------------------------------------------------------------------

    The agency has considered these comments and all others, and having
considered those comments, believes the final standards best balance
all relevant factors that the agency considers when determining maximum
feasible CAFE standards. As discussed below, having updated inputs to
its analysis and correspondingly updated its definition and analysis of
these regulatory alternatives, the agency continues to conclude that
manufacturers can respond to the proposed standards with technologies
that will be available at reasonable cost. The agency finds that
alternatives less stringent that the one adopted today would leave too
much technology ``on the shelf'' unnecessarily, thereby failing to
deliver the fuel savings that the nation needs or to yield
environmental benefits necessary to support a harmonized national
program. In response to some manufacturers' suggestion that NHTSA's
CAFE standards should be made even less stringent compared to EPA's GHG
emissions standards, NHTSA notes that the difference, consistent with
the underlying Notice of Intent, is based on the agencies' estimate of
the average amount of air conditioning credit earned, not the maximum
theoretically available, and that NHTSA's analysis indicates that most
manufacturers can achieve the CAFE standards by MY 2016 using tailpipe
technologies. This is fully consistent with the agency's historical
position. As NHTSA explained in the NPRM, the Conference Report for
EPCA, as enacted in 1975, makes clear, and applicable law affirms, ``a
determination of maximum feasible average fuel economy should not be
keyed to the single manufacturer which might have the most difficulty
achieving a given level of average fuel economy.'' CEI-I, 793 F.2d
1322, 1352 (DC Cir. 1986). Instead, NHTSA is compelled ``to weigh the
benefits to the nation of a higher fuel economy standard against the
difficulties of individual automobile manufacturers.'' Id. Thus, the
law permits CAFE standards exceeding the projected capability of any
particular manufacturer as long as the standard is economically
practicable for the industry as a whole.
    While some manufacturers may find greater A/C improvements to be a
more cost-effective way of meeting the GHG standards, that does not
mean those manufacturers will be unable to meet the CAFE standards with
tailpipe technologies. NHTSA's analysis has demonstrated a feasible
path to compliance with the CAFE standards for most manufacturers using
those technologies. ``Economic practicability'' means just that,
practicability, and need not always mean what is ``cheapest'' or ``most
cost-effective'' for a specific manufacturer. Moreover, many of the A/C
improvements on which manufacturers intend to rely for meeting the GHG
standards will reduce GHG emissions, specifically HFC emissions, but
they will not lead to greater fuel savings.\710\ The core purpose of
the CAFE standards under EPCA is to reduce fuel consumption. NHTSA
believes that less stringent standards would allow tailpipe fuel
economy technologies to be left on the table that can be feasibly and
economically applied, and failing to apply them would lead to a loss in
fuel savings. This would not place appropriate emphasis on the core
CAFE purpose of conserving fuel. For this reason, we decline to reduce
the stringency of our standards as requested by some manufacturers.
Similarly, we decline to pursue with EPA in this rulemaking the
suggestion by one commenter that that

agency's calculation authority under EPCA be used to provide A/C
credits.
---------------------------------------------------------------------------

    \710\ This is not to say that NHTSA means, in any way, to deter
manufacturers from employing A/C technologies to meet EPA's
standards, but simply to say that NHTSA's independent obligation to
set maximum feasible CAFE standards to be met through application of
tailpipe technologies alone must be fulfilled, while recognizing the
flexibilities offered in another regulatory program.
---------------------------------------------------------------------------

    With respect to some manufacturers' concerns regarding the increase
in stringency through MY 2013, the agency notes that stringency
increases in these model years are especially important in terms of the
accumulation of fuel savings and emission reductions over time. In
addition, a weakening would risk failing to produce emission reductions
at least as great as might be achieved through CARB's GHG standards.
Therefore, the agency believes that alternatives less stringent than
the one adopted today would not give sufficient emphasis to the
nation's need to conserve energy. The requirement to set standards that
increase ratably between MYs 2011 and 2020 must also be considered in
the context of what levels of standards would be maximum feasible. The
agency believes that the rate of increase of the final standards is
reasonable.
    On the other hand, the agency disagrees with comments by UCS, CBD,
and others indicating that more stringent standards would be
appropriate. As discussed above, alternatives more stringent than the
one adopted today would entail a rapidly increasing dependence on the
most expensive technologies and those which are technically more
demanding to implement, with commensurately rapid increases in costs.
In the agency's considered judgment, these alternatives are not
economically practicable, nor do they provide correspondingly
sufficient lead time. The agency also disagrees with CBD's assertion
that NHTSA and EPA have been overly conservative in assuming an average
redesign cycle of 5 years. There are some manufacturers who apply
longer cycles (such as smaller manufacturers described above), there
are others who have shorter cycles for some of their products, and
there are some products (e.g., cargo vans) that tend to be redesigned
on longer cycles. NHTSA believes that there are no full line
manufacturers who can maintain significant redesigns of vehicles (with
relative large sales) in 1 or 2 years, and CBD has provided no evidence
indicating this would be practicable. A complete redesign of the entire
U.S. light-duty fleet by model year 2012 is clearly infeasible, and
NHTSA and EPA believe that several model years additional lead time is
necessary in order for the manufacturers to meet the most stringent
standards. The graduated increase in the stringency of the standards
from MYs 2012 through 2016 accounts for the economic necessity of
timing the application of many major technologies to coincide with
scheduled model redesigns.
    In contrast, through analysis of the illustrative results shown
above, as well as the more complete and detailed results presented in
the accompanying FRIA, NHTSA has concluded that the final standards are
technologically feasible and economically practicable. The final
standards will require manufacturers to apply considerable additional
technology, starting with very significant investment in technology
design, development and capital investment called for in the next few
years. Although NHTSA cannot predict how manufacturers will respond to
the final standards, the agency's analysis indicates that the standards
could lead to significantly greater use of advanced engine and
transmission technologies. As shown above, the agency's analysis shows
considerable increases in the application of SGDI systems and engine
turbocharging and downsizing. Though not presented above, the agency's
analysis also shows similarly large increases in the use of dual-clutch
automated manual transmissions (AMTs). However, the agency's analysis
does not suggest that the additional application of these technologies
in response to the final standards would extend beyond levels
achievable by the industry. These technologies are likely to be applied
to at least some extent even in the absence of new CAFE standards. In
addition, the agency's analysis indicates that most manufacturers would
rely only to a limited extent on the most costly technologies, such as
diesel engines and advanced technologies, such as strong HEVs.
    As shown below, NHTSA estimates that the final standards could lead
to average incremental costs ranging from $303 per vehicle (for light
trucks in MY 2012) to $947 per vehicle (for light trucks in MY 2016),
increasing steadily from $396 per vehicle for all light vehicles in MY
2012 to $903 for all light vehicle in MY 2016. NHTSA estimates that
these costs would vary considerably among manufacturers, but would
rarely exceed $1,800 per vehicle. The following three tables summarize
estimated manufacturer-level average incremental costs for the final
standards and the average of the passenger and light truck fleets:

          Table IV.F-6--Average Incremental Costs ($/Vehicle) Under Final Passenger Car CAFE Standards
----------------------------------------------------------------------------------------------------------------
        Manufacturer              MY 2012         MY 2013          MY 2014          MY 2015          MY 2016
----------------------------------------------------------------------------------------------------------------
BMW.........................               3               4               24              184              585
Chrysler....................             734           1,043            1,129            1,270            1,358
Daimler.....................  ..............  ...............             410              801            1,109
Ford........................           1,619           1,537            1,533            1,713            1,884
General Motors..............             448             896            1,127            1,302            1,323
Honda.......................              33              98              205              273              456
Hyundai.....................             559             591              768              744              838
Kia.........................             110             144              177              235              277
Mazda.......................             555             656              799              854              923
Mitsubishi..................             534             460            1,588            1,875            1,831
Nissan......................             119             323              707              723              832
Porsche.....................              68             (52)             (51)             (50)             (49)
Subaru......................             292             324              988            1,385            1,361
Suzuki......................  ..............             625              779              794            1,005
Tata........................             111              93              183              306              710
Toyota......................              31              29               41              121              126
Volkswagen..................             145             428              477              492              783
                             -----------------------------------------------------------------------------------
    Average.................             455             552              670              774              880
----------------------------------------------------------------------------------------------------------------

           Table IV.F-7--Average Incremental Costs ($/Vehicle) Under Final Light Truck CAFE Standards
----------------------------------------------------------------------------------------------------------------
        Manufacturer              MY 2012         MY 2013          MY 2014          MY 2015          MY 2016
----------------------------------------------------------------------------------------------------------------
BMW.........................             252             239              277              281              701
Chrysler....................             360             527              876              931            1,170
Daimler.....................              60              51               51               52               51
Ford........................             465             633              673            1,074            1,174
General Motors..............             292             513              749              807              986
Honda.......................             233             217              370              457              806
Hyundai.....................             693             630            1,148            1,136            1,113
Kia.........................             400             467              582              780            1,137
Mazda.......................             144             241              250              354              480
Mitsubishi..................  ..............  ...............             553              686            1,371
Nissan......................             398             489              970            1,026            1,362
Porsche.....................  ..............              (1)              (1)             469              469
Subaru......................           1,036             995            1,016            1,060            1,049
Suzuki......................  ..............           1,797            1,744            1,689            1,732
Tata........................  ..............  ...............  ...............  ...............             503
Toyota......................             130             150              384              499              713
Volkswagen..................  ..............  ...............             514              458              441
                             -----------------------------------------------------------------------------------
    Average.................             303             411              615              741              947
----------------------------------------------------------------------------------------------------------------

                 Table IV.F-8--Average Incremental Costs ($/Vehicle) Under Final CAFE Standards
----------------------------------------------------------------------------------------------------------------
        Manufacturer              MY 2012         MY 2013          MY 2014          MY 2015          MY 2016
----------------------------------------------------------------------------------------------------------------
BMW.........................             106              94              110              213              618
Chrysler....................             499             743              989            1,084            1,257
Daimler.....................              20              18              281              554              773
Ford........................           1,195           1,187            1,205            1,472            1,622
General Motors..............             371             705              946            1,064            1,165
Honda.......................             116             144              266              343              585
Hyundai.....................             577             599              847              805              879
Kia.........................             176             221              263              334              426
Mazda.......................             482             587              716              778              858
Mitsubishi..................             371             319            1,200            1,389            1,647
Nissan......................             211             376              792              813              984
Porsche.....................              52             (39)             (35)             130              124
Subaru......................             551             552              998            1,267            1,248
Suzuki......................  ..............             823              954              946            1,123
Tata........................              61              56              101              182              629
Toyota......................              67              70              159              248              317
Volkswagen..................             117             333              486              486              723
                             -----------------------------------------------------------------------------------
    Average.................             396             498              650              762              903
----------------------------------------------------------------------------------------------------------------

    In summary, NHTSA has considered eight regulatory alternatives,
including the final standards, examining technologies that could be
applied in response to each alternative, as well as corresponding
costs, effects, and benefits. The agency has concluded that
alternatives less stringent than the final standards would not produce
the fuel savings and CO2 reductions necessary at this time
to achieve either the overarching purpose of EPCA, i.e., energy
conservation, or an important part of the regulatory harmonization
underpinning the National Program, and would forego these benefits even
though there is adequate lead time to implement reasonable and feasible
technology for the vehicles. Conversely, the agency has concluded that
more stringent standards would involve levels of additional technology
and cost that would be economically impracticable and, correspondingly,
would provide inadequate lead time, considering the economic state of
the automotive industry, would not be economically practicable.
Therefore, having considered these eight regulatory alternatives, and
the statutorily-relevant factors of technological feasibility, economic
practicability, the effect of other motor vehicle standards of the
Government on fuel economy, and the need of the United States to
conserve energy, along with other relevant factors such as the safety
impacts of the final standards,\711\ NHTSA concludes that the final
standards represent a reasonable balancing of all of these concerns,
and are the maximum feasible average fuel economy levels that the
manufacturers can achieve in MYs 2012-2016.
---------------------------------------------------------------------------

    \711\ See Section IV.G.7 below.
---------------------------------------------------------------------------

G. Impacts of the Final CAFE Standards

1. How will these standards improve fuel economy and reduce GHG
emissions for MY 2012-2016 vehicles?
    As discussed above, the CAFE level required under an attribute-
based standard depends on the mix of vehicles produced for sale in the
U.S. Based on the market forecast that NHTSA and EPA have used to
develop and analyze new CAFE and CO2 emissions standards,
NHTSA estimates that the new CAFE standards will require CAFE levels to
increase by an average of 4.3 percent annually through MY 2016,
reaching a combined average fuel

economy requirement of 34.1 mpg in that model year:

               Table IV.G.1-1--Estimated Average Required Fuel Economy (mpg) Under Final Standards
----------------------------------------------------------------------------------------------------------------
         Model year                2012             2013             2014             2015             2016
----------------------------------------------------------------------------------------------------------------
Passenger Cars..............            33.3            34.2             34.9             36.2             37.8
Light Trucks................            25.4            26.0             26.6             27.5             28.8
                             -----------------------------------------------------------------------------------
    Combined................            29.7            30.5             31.3             32.6             34.1
----------------------------------------------------------------------------------------------------------------

    NHTSA estimates that average achieved fuel economy levels will
correspondingly increase through MY 2016, but that manufacturers will,
on average, undercomply \712\ in some model years and overcomply \713\
in others, reaching a combined average fuel economy of 33.7 mpg in MY
2016: \714\
---------------------------------------------------------------------------

    \712\ In NHTSA's analysis, ``undercompliance'' is mitigated
either through use of FFV credits, use of existing or ``banked''
credits, or through fine payment. Because NHTSA cannot consider
availability of credits in setting standards, the estimated achieved
CAFE levels presented here do not account for their use. In
contrast, because NHTSA is not prohibited from considering fine
payment, the estimated achieved CAFE levels presented here include
the assumption that BMW, Daimler (i.e., Mercedes), Porsche, and,
Tata (i.e., Jaguar and Rover) will only apply technology up to the
point that it would be less expensive to pay civil penalties.
    \713\ In NHTSA's analysis, ``overcompliance'' occurs through
multi-year planning: manufacturers apply some ``extra'' technology
in early model years (e.g., MY 2014) in order to carry that
technology forward and thereby facilitate compliance in later model
years (e.g., MY 2016).
    \714\ Consistent with EPCA, NHTSA has not accounted for
manufacturers' ability to earn CAFE credits for selling FFVs, carry
credits forward and back between model years, and transfer credits
between the passenger car and light truck fleets.

               Table IV.G.1-2--Estimated Average Achieved Fuel Economy (mpg) Under Final Standards
----------------------------------------------------------------------------------------------------------------
         Model year                2012             2013             2014             2015             2016
----------------------------------------------------------------------------------------------------------------
Passenger Cars..............            32.8            34.4             35.3             36.3             37.2
Light Trucks................            25.1            26.0             27.0             27.6             28.5
                             -----------------------------------------------------------------------------------
    Combined................            29.3            30.6             31.7             32.6             33.7
----------------------------------------------------------------------------------------------------------------

    NHTSA estimates that these fuel economy increases will lead to fuel
savings totaling 61 billion gallons during the useful lives of vehicles
manufactured in MYs 2012-2016:

                                           Table IV.G.1-3--Fuel Saved (Billion Gallons) Under Final Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                       Model year                              2012            2013            2014            2015            2016            Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
Passenger Cars..........................................             2.4             5.2             7.2             9.4            11.4            35.7
Light Trucks............................................             1.8             3.7             5.3             6.5             8.1            25.4
                                                         -----------------------------------------------------------------------------------------------
    Combined............................................             4.2             8.9            12.5            16.0            19.5            61.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The agency also estimates that these new CAFE standards will lead
to corresponding reductions of CO2 emissions totaling 655
million metric tons (mmt) during the useful lives of vehicles sold in
MYs 2012-2016:

                                      Table IV.G.1-4--Carbon Dioxide Emissions (mmt) Avoided Under Final Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                       Model year                              2012            2013            2014            2015            2016            Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
Passenger Cars..........................................              25              54              77             101             123             380
Light Trucks............................................              19              40              57              71              88             275
                                                         -----------------------------------------------------------------------------------------------
    Combined............................................              44              94             134             172             210             655
--------------------------------------------------------------------------------------------------------------------------------------------------------

2. How will these standards improve fleet-wide fuel economy and reduce
GHG emissions beyond MY 2016?
    Under the assumption that CAFE standards at least as stringent as
those being finalized today for MY 2016 would be established for
subsequent model years, the effects of the final standards on fuel
consumption and GHG emissions will continue to increase for many years.
This will occur because over time, a growing fraction of the U.S.
light-duty vehicle fleet will be comprised of cars and light trucks
that meet the MY 2016 standard. The impact of the new standards on fuel
use and GHG emissions will continue to grow through approximately 2050,
when virtually all cars and light trucks in service will have met
standards as stringent as those established for MY 2016.
    As Table IV.G.2-1 shows, NHTSA estimates that the fuel economy

increases resulting from the final standards will lead to reductions in
total fuel consumption by cars and light trucks of 10 billion gallons
during 2020, increasing to 32 billion gallons by 2050. Over the period
from 2012, when the final standards would begin to take effect, through
2050, cumulative fuel savings would total 729 billion gallons, as Table
IV.G.2-1 also indicates.

            Table IV.G.2-1--Reduction in Fleet-Wide Fuel Use (Billion Gallons) Under Final Standards
----------------------------------------------------------------------------------------------------------------
                                                                                Total, 2012-
          Calendar year                2020            2030            2040            2050            2050
----------------------------------------------------------------------------------------------------------------
Passenger Cars..................               6              13              17              21             469
Light Trucks....................               4               7               9              11             260
                                 -------------------------------------------------------------------------------
    Combined....................              10              20              26              32             729
----------------------------------------------------------------------------------------------------------------

    The energy security analysis conducted for this rule estimates that
the world price of oil will fall modestly in response to lower U.S.
demand for refined fuel. One potential result of this decline in the
world price of oil would be an increase in the consumption of petroleum
products outside the U.S., which would in turn lead to a modest
increase in emissions of greenhouse gases, criteria air pollutants, and
airborne toxics from their refining and use. While additional
information would be needed to analyze this ``leakage effect'' in
detail, NHTSA provides a sample estimate of its potential magnitude in
its Final EIS.\715\ This analysis indicates that the leakage effect is
likely to offset only a modest fraction of the reductions in emissions
projected to result from the rule.
---------------------------------------------------------------------------

    \715\ NHTSA Final Environmental Impact Statement: Corporate
Average Fuel Economy Standards, Passenger Cars and Light Trucks,
Model Years 2012-2016, February 2010, page 3-14.
---------------------------------------------------------------------------

    As a consequence of these reductions in fleet-wide fuel
consumption, the agency also estimates that the new CAFE standards for
MYs 2012-2016 will lead to corresponding reductions in CO2
emissions from the U.S. light-duty vehicle fleet. Specifically, NHTSA
estimates that total annual CO2 emissions associated with
passenger car and light truck use in the U.S. use will decline by 116
million metric tons (mmt) in 2020 as a consequence of the new
standards, as Table IV.G.2-2 reports. The table also shows that the
this annual reduction is estimated to grow to nearly 400 million metric
tons by the year 2050, and will total nearly 9 billion metric tons over
the period from 2012, when the final standards would take effect,
through 2050.

  Table IV.G.2-2--Reduction in Fleet-Wide Carbon Dioxide Emissions (mmt) From Passenger Car and Light Truck Use
                                              Under Final Standards
----------------------------------------------------------------------------------------------------------------
                                                                                Total, 2012-
          Calendar year                2020            2030            2040            2050            2050
----------------------------------------------------------------------------------------------------------------
Passenger Cars..................              69             153             205             255           5,607
Light Trucks....................              49              89             112             136           3,208
                                 -------------------------------------------------------------------------------
    Combined....................             117             242             316             391           8,815
----------------------------------------------------------------------------------------------------------------

    These reductions in fleet-wide CO2 emissions, together
with corresponding reductions in other GHG emissions from fuel
production and use, would lead to small but significant reductions in
projected changes in the future global climate. These changes, based on
analysis documented in the final Environmental Impact Statement (EIS)
that informed the agency's decisions regarding this rule, are
summarized in Table IV.G.2-3 below.

   Table IV.G.2-3--Effects of Reductions in Fleet-Wide Carbon Dioxide Emissions (mmt) on Projected Changes in
                                                 Global Climate
----------------------------------------------------------------------------------------------------------------
                                                                            Projected change in measure
                                                                 -----------------------------------------------
            Measure                   Units            Date                        With proposed
                                                                     No action       standards      Difference
----------------------------------------------------------------------------------------------------------------
Atmospheric CO2 Concentration.  ppm.............            2100           783.0           780.3            -2.7
Increase in Global Mean         [deg]C..........            2100           3.136           3.125          -0.011
 Surface Temperature.
Sea Level Rise................  cm..............            2100           38.00           37.91           -0.09
Global Mean Precipitation.....  % change from               2090           4.59%           4.57%          -0.02%
                                 1980-1999 avg.
----------------------------------------------------------------------------------------------------------------

3. How will these final standards impact non-GHG emissions and their
associated effects?
    Under the assumption that CAFE standards at least as stringent as
those proposed for MY 2016 would be established for subsequent model
years, the effects of the new standards on air quality and its
associated health effects will continue to be felt over the foreseeable
future. This will occur because over time a growing fraction of the
U.S. light-duty vehicle fleet will be comprised of cars and light
trucks that meet the MY 2016 standard, and this growth will continue
until approximately 2050.
    Increases in the fuel economy of light-duty vehicles required by
the new CAFE standards will cause a slight increase in the number of
miles they are driven, through the fuel economy ``rebound effect.'' In
turn, this increase in vehicle use will lead to increases in emissions
of criteria air pollutants and some airborne toxics, since these are
products of the number of miles vehicles are driven.
    At the same time, however, the projected reductions in fuel
production and use reported in Table IV.G.2-1 above will lead to
corresponding reductions in emissions of these pollutants that occur
during fuel production and distribution (``upstream'' emissions). For
most of these pollutants, the reduction in upstream emissions resulting
from lower fuel production and distribution will outweigh the increase
in emissions from vehicle use, resulting in a net decline in their
total emissions.\716\
---------------------------------------------------------------------------

    \716\ As stated elsewhere, while the agency's analysis assumes
that all changes in upstream emissions result from a decrease in
petroleum production and transport, the analysis of non-GHG
emissions in future calendar years also assumes that retail gasoline
composition is unaffected by this rule; as a result, the impacts of
this rule on downstream non-GHG emissions (more specifically, on air
toxics) may be underestimated. See also Section III.G above for more
information.
---------------------------------------------------------------------------

    Tables IV.G.3-1a and 3-1b report estimated reductions in emissions
of selected criteria air pollutants (or their chemical precursors) and
airborne toxics expected to result from the final standards during
calendar year 2030. By that date, the majority of light-duty vehicles
in use will have met the MY 2016 CAFE standards, so these reductions
provide a useful index of the long-term impact of the final standards
on air pollution and its consequences for human health.

     Table IV.G.3-1a--Projected Changes in Emissions of Criteria Air Pollutants From Car and Light Truck Use
                                           [Calendar year 2030; tons]
----------------------------------------------------------------------------------------------------------------
                                                                      Criteria air pollutant
                                                 ---------------------------------------------------------------
                                    Source of                                                        Volatile
         Vehicle class              emissions        Nitrogen       Particulate    Sulfur oxides      organic
                                                   oxides  (NOX)      matter           (SOX)         compounds
                                                                      (PM2.5)                          (VOC)
----------------------------------------------------------------------------------------------------------------
Passenger Cars................  Vehicle use.....           2,718             465          -2,442           2,523
                                Fuel production          -20,970          -2,831         -12,698         -75,342
                                 and
                                 distribution.
                                All sources.....         -18,252          -2,366         -15,140         -72,820
                               ---------------------------------------------------------------------------------
Light Trucks..................  Vehicle use.....           3,544             176          -1,420           1,586
                                Fuel production          -12,252          -1,655          -7,424         -43,763
                                 and
                                 distribution.
                                All sources.....          -8,707          -1,479          -8,845         -42,177
                               ---------------------------------------------------------------------------------
    Total.....................  Vehicle use.....           6,263             642          -3,862           4,108
                                Fuel production          -33,222          -4,487         -20,122        -119,106
                                 and
                                 distribution.
                                All sources.....         -26,959          -3,845         -23,984        -114,997
----------------------------------------------------------------------------------------------------------------

         Table IV.G.3-1b--Projected Changes in Emissions of Airborne Toxics From Car and Light Truck Use
                                           [Calendar year 2030; tons]
----------------------------------------------------------------------------------------------------------------
                                                                              Toxic air pollutant
            Vehicle class               Source of emissions  ---------------------------------------------------
                                                                  Benzene     1,3[dash]Butadiene   Formaldehyde
----------------------------------------------------------------------------------------------------------------
Passenger Cars......................  Vehicle use...........              72                18                59
                                      Fuel production and               -161                -2               -58
                                       distribution.
                                      All sources...........             -89                16                 1
                                     ---------------------------------------------------------------------------
Light Trucks........................  Vehicle use...........              38                10                65
                                      Fuel production and                -94                -1               -34
                                       distribution.
                                      All sources...........             -55                 9                32
                                     ---------------------------------------------------------------------------
    Total...........................  Vehicle use...........             111                28               124
                                      Fuel production and               -254                -3               -91
                                       distribution.
                                      All sources...........            -144                25                33
----------------------------------------------------------------------------------------------------------------
Note: Positive values indicate increases in emissions; negative values indicate reductions.

    In turn, the reductions in emissions reported in Tables IV.G.3-1a
and 3-1b are projected to result in significant declines in the health
effects that result from population exposure to these pollutants. Table
IV.G.3-2 reports the estimated reductions in selected PM2.5-
related human health impacts that are expected to result from reduced

population exposure to unhealthful atmospheric concentrations of
PM2.5. The estimates reported in Table IV.G.3-2, based on
analysis documented in the final Environmental Impact Statement (EIS)
that informed the agency's decisions regarding this rule, are derived
from PM2.5-related dollar-per-ton estimates that include
only quantifiable reductions in health impacts likely to result from
reduced population exposure to particular matter (PM). They do not
include all health impacts related to reduced exposure to PM, nor do
they include any reductions in health impacts resulting from lower
population exposure to other criteria air pollutants (particularly
ozone) and air toxics. However, emissions changes and dollar-per-ton
estimates alone are not necessarily a good indication of local or
regional air quality and health impacts, as there may be localized
impacts associated with this rulemaking, because the atmospheric
chemistry related to ambient concentrations of PM2.5, ozone,
and air toxics is very complex. Full-scale photochemical modeling
provides the necessary spatial and temporal detail to more completely
and accurately estimate the changes in ambient levels of these
pollutants and their associated health and welfare impacts. Although
EPA conducted such modeling for purposes of the final rule, it was not
available in time to be included in NHTSA's FEIS. See Section III.G
above for EPA's description of the full-scale air quality modeling it
conducted for the 2030 calendar year in an effort to capture this
variability.

  Table IV.G.3-2--Projected Reductions in Health Impacts of Exposure to
              Criteria Air Pollutants From Final Standards
                          [Calendar year 2030]
------------------------------------------------------------------------
                                                     Projected reduction
        Health impact                Measure               (2030)
------------------------------------------------------------------------
Mortality (ages 30 and        premature deaths per  243 to 623.
 older).                       year.
Chronic Bronchitis..........  cases per year......  160.
Emergency Room Visits for     number per year.....  222.
 Asthma.
Work Loss...................  workdays per year...  28,705.
------------------------------------------------------------------------

4. What are the estimated costs and benefits of these final standards?
    NHTSA estimates that the final standards could entail significant
additional technology beyond the levels reflected in the baseline
market forecast used by NHTSA. This additional technology will lead to
increases in costs to manufacturers and vehicle buyers, as well as fuel
savings to vehicle buyers. The following three tables summarize the
extent to which the agency estimates technologies could be added to the
passenger car, light truck, and overall fleets in each model year in
response to the proposed standards. Percentages reflect the
technology's additional application in the market, and are negative in
cases where one technology is superseded (i.e., displaced) by another.
For example, the agency estimates that many automatic transmissions
used in light trucks could be displaced by dual clutch transmissions.

              Table IV.G.4-1--Addition of Technologies to Passenger Car Fleet Under Final Standards
----------------------------------------------------------------------------------------------------------------
                                      MY 2012         MY 2013         MY 2014         MY 2015         MY 2016
           Technology                (percent)       (percent)       (percent)       (percent)       (percent)
----------------------------------------------------------------------------------------------------------------
Low Friction Lubricants.........              14              18              19              21              21
Engine Friction Reduction.......              15              37              41              43              52
VVT--Coupled Cam Phasing (CCP)                 2               3               3               5               7
 on SOHC........................
Discrete Variable Valve Lift                   0               1               1               4               4
 (DVVL) on SOHC.................
Cylinder Deactivation on SOHC...               0               0               0               0               0
VVT--Intake Cam Phasing (ICP)...               0               0               0               0               0
VVT--Dual Cam Phasing (DCP).....              11              15              16              17              24
Discrete Variable Valve Lift                   9              19              22              23              29
 (DVVL) on DOHC.................
Continuously Variable Valve Lift               0               0               0               0               0
 (CVVL).........................
Cylinder Deactivation on DOHC...               0               0               0               1               2
Cylinder Deactivation on OHV....               0               1               1               1               1
VVT--Coupled Cam Phasing (CCP)                 0               1               2               2               2
 on OHV.........................
Discrete Variable Valve Lift                   0               1               1               2               3
 (DVVL) on OHV..................
Conversion to DOHC with DCP.....               0               0               0               0               0
Stoichiometric Gasoline Direct                 9              18              21              24              28
 Injection (GDI)................
Combustion Restart..............               0               0               1               4               9
Turbocharging and Downsizing....               8              14              16              19              21
Exhaust Gas Recirculation (EGR)                0               8              10              13              17
 Boost..........................
Conversion to Diesel following                 2               2               2               2               2
 TRBDS..........................
Conversion to Diesel following                 0               0               0               0               0
 CBRST..........................
6-Speed Manual/Improved                        1               1               1               1               1
 Internals......................
Improved Auto. Trans. Controls/                0               3               4               1              -3
 Externals......................
Continuously Variable                          0               0               0               0               0
 Transmission...................
6/7/8-Speed Auto. Trans with                   0               0               1               1               2
 Improved Internals.............
Dual Clutch or Automated Manual               12              26              34              47              54
 Transmission...................
Electric Power Steering.........               9              22              25              26              38
Improved Accessories............              18              25              27              31              41
12V Micro-Hybrid................               0               0               0               0               0
Belt mounted Integrated Starter                4              11              19              24              25
 Generator......................

Crank mounted Integrated Starter               3               3               3               3               3
 Generator......................
Power Split Hybrid..............               2               2               2               2               2
2-Mode Hybrid...................               0               0               0               0               0
Plug-in Hybrid..................               0               0               0               0               0
Mass Reduction (1.5)............              18              26              32              39              46
Mass Reduction (3.5 to 8.5).....               0               0              17              31              40
Low Rolling Resistance Tires....               4              16              23              32              35
Low Drag Brakes.................               2               3               4               4               6
Secondary Axle Disconnect--                    0               0               0               0               0
 Unibody........................
Secondary Axle Disconnect--                    1               2               2               2               2
 Ladder Frame...................
Aero Drag Reduction.............               6              20              29              34              38
----------------------------------------------------------------------------------------------------------------

               Table IV.G.4-2--Addition of Technologies to Light Truck Fleet Under Final Standards
----------------------------------------------------------------------------------------------------------------
                                      MY 2012         MY 2013         MY 2014         MY 2015         MY 2016
           Technology                (percent)       (percent)       (percent)       (percent)       (percent)
----------------------------------------------------------------------------------------------------------------
Low Friction Lubricants.........              18              20              22              23              23
Engine Friction Reduction.......              14              34              35              40              51
VVT--Coupled Cam Phasing (CCP)                 2               3               3               2               2
 on SOHC........................
Discrete Variable Valve Lift                   1               2               2               2               3
 (DVVL) on SOHC.................
Cylinder Deactivation on SOHC...               6               6               6               6               5
VVT--Intake Cam Phasing (ICP)...               0               0               0               1               1
VVT--Dual Cam Phasing (DCP).....               6               8              13              13              17
Discrete Variable Valve Lift                   9              12              17              17              18
 (DVVL) on DOHC.................
Continuously Variable Valve Lift               0               0               0               0               0
 (CVVL).........................
Cylinder Deactivation on DOHC...               1               1               1               1               0
Cylinder Deactivation on OHV....               0               1               1               2               7
VVT--Coupled Cam Phasing (CCP)                 0               0               0               0              13
 on OHV.........................
Discrete Variable Valve Lift                   0              13              14              19              19
 (DVVL) on OHV..................
Conversion to DOHC with DCP.....               0               0               0               0               0
Stoichiometric Gasoline Direct                12              17              23              24              31
 Injection (GDI)................
Combustion Restart..............               0               0               3               5              18
Turbocharging and Downsizing....               3               6              10              10              14
Exhaust Gas Recirculation (EGR)                0               2               6               6               9
 Boost..........................
Conversion to Diesel following                 1               1               1               1               1
 TRBDS..........................
Conversion to Diesel following                 0               0               0               0               0
 CBRST..........................
6-Speed Manual/Improved                        0               0               0               0               0
 Internals......................
Improved Auto. Trans. Controls/                0             -11             -17             -28             -32
 Externals......................
Continuously Variable                          0               0               0               0               0
 Transmission...................
6/7/8-Speed Auto. Trans with                  -2              -2              -2              -2              -1
 Improved Internals.............
Dual Clutch or Automated Manual               10              32              46              58              65
 Transmission...................
Electric Power Steering.........               7              11              11              20              27
Improved Accessories............               7               9              10              15              23
12V Micro-Hybrid................               0               0               0               0               0
Belt mounted Integrated Starter                5              10              19              20              21
 Generator......................
Crank mounted Integrated Starter               0               0               0               0               0
 Generator......................
Power Split Hybrid..............               1               1               1               1               1
2-Mode Hybrid...................               0               0               0               0               0
Plug-in Hybrid..................               0               0               0               0               0
Mass Reduction (1.5)............               4               5              21              35              48
Mass Reduction (3.5 to 8.5).....               0               0              19              33              54
Low Rolling Resistance Tires....              11              12              13              16              17
Low Drag Brakes.................              14              32              30              31              40
Secondary Axle Disconnect--                    0               0               0               0               0
 Unibody........................
Secondary Axle Disconnect--                   17              19              20              21              28
 Ladder Frame...................
Aero Drag Reduction.............              13              15              20              22              25
----------------------------------------------------------------------------------------------------------------

                 Table IV.G.4-3--Addition of Technologies to Overall Fleet Under Final Standards
----------------------------------------------------------------------------------------------------------------
                                      MY 2012         MY 2013         MY 2014         MY 2015         MY 2016
           Technology                (percent)       (percent)       (percent)       (percent)       (percent)
----------------------------------------------------------------------------------------------------------------
Low Friction Lubricants.........              16              18              20              22              22
Engine Friction Reduction.......              15              36              39              42              51
VVT--Coupled Cam Phasing (CCP)                 2               3               3               4               5
 on SOHC........................
Discrete Variable Valve Lift                   0               1               2               3               3
 (DVVL) on SOHC.................
Cylinder Deactivation on SOHC...               2               3               2               2               2
VVT--Intake Cam Phasing (ICP)...               0               0               0               0               0

VVT--Dual Cam Phasing (DCP).....               9              13              15              16              22
Discrete Variable Valve Lift                   9              16              20              21              25
 (DVVL) on DOHC.................
Continuously Variable Valve Lift               0               0               0               0               0
 (CVVL).........................
Cylinder Deactivation on DOHC...               0               1               0               1               1
Cylinder Deactivation on OHV....               0               1               1               1               3
VVT--Coupled Cam Phasing (CCP)                 0               1               1               1               6
 on OHV.........................
Discrete Variable Valve Lift                   0               6               6               8               8
 (DVVL) on OHV..................
Conversion to DOHC with DCP.....               0               0               0               0               0
Stoichiometric Gasoline Direct                10              17              22              24              29
 Injection (GDI)................
Combustion Restart..............               0               0               1               4              12
Turbocharging and Downsizing....               6              11              14              16              19
Exhaust Gas Recirculation (EGR)                0               6               8              11              14
 Boost..........................
Conversion to Diesel following                 1               2               2               2               2
 TRBDS..........................
Conversion to Diesel following                 0               0               0               0               0
 CBRST..........................
6-Speed Manual/Improved                        0               0               0               0               1
 Internals......................
Improved Auto. Trans. Controls/                0              -2              -4             -10             -13
 Externals......................
Continuously Variable                          0               0               0               0               0
 Transmission...................
6/7/8-Speed Auto. Trans with                  -1               0               0               0               1
 Improved Internals.............
Dual Clutch or Automated Manual               11              28              38              51              58
 Transmission...................
Electric Power Steering.........               8              18              20              24              34
Improved Accessories............              13              19              21              25              35
12V Micro-Hybrid................               0               0               0               0               0
Belt mounted Integrated Starter                5              11              19              23              23
 Generator......................
Crank mounted Integrated Starter               2               2               2               2               2
 Generator......................
Power Split Hybrid..............               2               2               2               1               1
2-Mode Hybrid...................               0               0               0               0               0
Plug-in Hybrid..................               0               0               0               0               0
Mass Reduction (1.5)............              13              18              28              37              47
Mass Reduction (3.5 to 8.5).....               0               0              18              32              45
Low Rolling Resistance Tires....               7              14              19              26              29
Low Drag Brakes.................               6              14              14              14              18
Secondary Axle Disconnect--                    0               0               0               0               0
 Unibody........................
Secondary Axle Disconnect--                    7               8               8               8              11
 Ladder Frame...................
Aero Drag Reduction.............               9              18              26              30              34
----------------------------------------------------------------------------------------------------------------

    In order to pay for this additional technology (and, for some
manufacturers, civil penalties), NHTSA estimates that the cost of an
average passenger car and light truck will, relative to levels
resulting from compliance with baseline (MY 2011) standards, increase
by $505-$907 and $322-$961, respectively, during MYs 2011-2016. The
following tables summarize the agency's estimates of average cost
increases for each manufacturer's passenger car, light truck, and
overall fleets (with corresponding averages for the industry):

           Table IV.G.4-4--Average Passenger Car Incremental Cost Increases ($) Under Final Standards
----------------------------------------------------------------------------------------------------------------
          Manufacturer                MY 2012         MY 2013         MY 2014         MY 2015         MY 2016
----------------------------------------------------------------------------------------------------------------
BMW.............................             157             196             255             443             855
Chrysler........................             794           1,043           1,129           1,270           1,358
Daimler.........................             160             198             564             944           1,252
Ford............................           1,641           1,537           1,533           1,713           1,884
General Motors..................             552             896           1,127           1,302           1,323
Honda...........................              33              98             205             273             456
Hyundai.........................             559             591             768             744             838
Kia.............................             110             144             177             235             277
Mazda...........................             632             656             799             854             923
Mitsubishi......................             644             620           1,588           1,875           1,831
Nissan..........................             119             323             707             723             832
Porsche.........................             316             251             307             390             496
Subaru..........................             413             472             988           1,385           1,361
Suzuki..........................             242             625             779             794           1,005
Tata............................             243             258             370             532             924
Toyota..........................              31              29              41             121             126
Volkswagen......................             293             505             587             668             964
                                 -------------------------------------------------------------------------------
    Total/Average...............             505             573             690             799             907
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            Table IV.G.4-5--Average Light Truck Incremental Cost Increases ($) Under Final Standards
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          Manufacturer                MY 2012         MY 2013         MY 2014         MY 2015         MY 2016
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BMW.............................             252             272             338             402             827
Chrysler........................             409             527             876             931           1,170
Daimler.........................              98             123             155             189             260
Ford............................             465             633             673           1,074           1,174
General Motors..................             336             513             749             807             986
Honda...........................             233             217             370             457             806
Hyundai.........................             693             630           1,148           1,136           1,113