respectively,\206\ which put their projections slightly higher than
BNEF's 2019 projections. BNEF's more recent 2020 Electric Vehicle
Outlook projected average pack cost to fall below $100/kWh by
2024,\207\ while the 2021 NAS report projected that pack costs are
projected to reach $90-115 kWh by 2025.\208\
---------------------------------------------------------------------------

    \204\ See Logan Goldie-Scot, A Behind the Scenes Take on
Lithium-ion Battery Prices, Bloomberg New Energy Finance (March 5,
2019), https://about.bnef.com/blog/behind-scenes-take-lithium-ion-battery-prices/.
    \205\ MIT Energy Initiative. 2019. Insights into Future
Mobility. Cambridge, MA: MIT Energy Initiative. Available at http://energy.mit.edu/insightsintofuturemobility.
    \206\ Nic Lutsey and Michael Nicholas, Update on electric
vehicle costs in the United States through 2030, ICCT (April 2,
2019), available at https://theicct.org/publications/update-US-2030-electric-vehicle-cost.
    \207\ Bloomberg New Energy Finance (BNEF), ``Electric Vehicle
Outlook 2020,'' https://about.bnef.com/electric-vehicle-outlook/,
last accessed July 29, 2021.
    \208\ 2021 NAS report, at 5-121. The 2021 NAS report assumed a 7
percent cost reduction per year from 2018 through 2030.
---------------------------------------------------------------------------

    That our projected costs seem to fall between several projections
gives us some confidence that the costs in this NPRM could reasonably
represent future battery pack costs across the industry during the
rulemaking time frame. That said, we recognize that battery technology
is currently under intensive development, and that characteristics such
as cost and capability are rapidly changing. These advances are
reflected in recent aggressive projections, like those from ICCT, BNEF,
and the 2021 NAS report. As a result, we would like to seek comments,
supported by data elements as outlined below, on these characteristics.
    We seek comment on the input assumptions used to generate battery
pack costs in BatPaC and the BatPaC-generated direct manufacturing
costs for the base year (MY 2020). If commenters believe that different
input assumptions should be used for battery chemistry,\209\

plant manufacturing volume, or plant efficiency in MY 2020, they should
provide data or other information validating such assumptions. In
addition, commenters should explain how these assumptions reasonably
represent applications across the industry in MY 2020. This is
important to align with our guiding principles to ensure that the CAFE
Model's simulation of manufacturer compliance pathways results in
impacts that we would reasonably expect to see in the real world. As
discussed above, each technology model employed in the analysis is
designed to be representative of a wide range of specific technology
applications used in industry. Some vehicle manufacturer's systems may
perform better and cost less than our modeled systems and some may
perform worse and cost more. However, employing this approach will
ensure that, on balance, the analysis captures a reasonable level of
costs and benefits that would result from any manufacturer applying the
technology. In this case, vehicle and battery manufacturers use
different chemistries, cell types, and production processes to
manufacture electric vehicle battery packs. Any proposed alternative
costs for base year direct manufacturing costs should be able to
represent the range of costs across the industry in MY 2020 based on
different manufacturers using different approaches.
---------------------------------------------------------------------------

    \209\ Note that stakeholders had commented to the 2020 final
rule that batteries using NMC811 chemistry had either recently come
into the market or was imminently coming into the market, and
therefore DOT should have selected NMC811 as the appropriate
chemistry for modeling battery pack costs. Similar to the other
technologies considered in this analysis, DOT endeavors to use
technology that is a reasonable representation of what the industry
could achieve in the model year or years under consideration, in
this case the base DMC year of 2020, as discussed above. At the time
of this current analysis, the referenced A2Mac1 teardown reports and
other reports provided the best available information about the
range of battery chemistry actually employed in the industry. At the
time of writing, DOT still has not found examples of NMC811 in
commercial application across the industry in a way that DOT
believes selecting NMC811 would have represented industry average
performance in MY 2020. As discussed in TSD Chapter <IP_ADDRESS>.4, DOT
did analyze the potential future cost of NMC811 in the composite
learning curve generated to ensure the battery learning curve
projections are reasonable.
---------------------------------------------------------------------------

    We also seek comment on the scaling used to generate direct
manufacturing costs for BEV400 and BEV500 technologies. If commenters
have additional data or information on the relationship between cost
and weight for heavier battery packs used for these higher-range BEV
applications, particularly in light truck vehicle segments, that would
be helpful as well.
    In addition, we seek comment on the learning rates applied to the
battery pack costs and on the battery pack costs in future years.
Recognizing that any battery pack cost projections for future years
from our analysis or external analyses will involve assumptions that
may or may not come to pass, it would be most helpful if commenters
thoroughly explained the basis for any recommended learning rates,
including references to publicly available data or models (and if such
models are peer reviewed) where appropriate. Similarly, it would be
helpful for commenters to note where external analyses may or may not
take into account certain parameters in their battery pack cost
projections, and whether we should attempt to incorporate those
parameters in our analysis. For example, as discussed above, our
analysis does not consider raw material price fluctuations; however,
the price of battery pack raw materials will put a lower bound on NMC-
based battery prices.\210\
---------------------------------------------------------------------------

    \210\ See, e.g., MIT Energy Initiative. 2019. Insights into
Future Mobility. Cambridge, MA: MIT Energy Initiative. Available at
http://energy.mit.edu/insightsintofuturemobility, at 78-9.
---------------------------------------------------------------------------

    It would also be helpful if commenters explained how learning rates
or future cost projections could represent the state of battery
technology across the industry. Like other technologies considered in
this analysis, some battery and vehicle manufacturers have more
experience manufacturing electric vehicle battery packs, and some have
less, meaning that different manufacturers will be at different places
along the learning curve in future years. Note also that comments
should specify whether their referenced costs, either for MY 2020 or
for future years, are for the battery cell or the battery pack.
    Ensuring our learning rates encompass these diverse parameters will
ensure that the analysis best predicts the costs and benefits
associated with future standards. We will incorporate any new
information received to the extent possible for the final rule and
future analyses.
    Recognizing again that battery technology is a rapidly evolving
field and there are a range of external analyses that project battery
pack costs declining at different rates across the next decade, as
discussed above and further in the TSD, we performed four sensitivity
studies around battery pack costs that are described in PRIA Chapter
<IP_ADDRESS>. The sensitivity studies examined the impacts of increasing and
decreasing the direct cost of batteries and battery learning costs by
20 percent from central analysis levels, based on our survey of
external analyses' battery pack cost projections that fell generally
within +/-20% of our central analysis costs. We found that changing the
battery direct manufacturing costs in MY 2020 without changing the
learning rate did not produce meaningfully different outcomes for
electric vehicle technology penetration in later years, although it
resulted in the lowest technology costs. Keeping the same direct
manufacturing costs and using a steeper battery learning rate produced
slightly higher technology costs, compared to the sensitivity results
that changed battery pack direct manufacturing cost and kept learning
rate the same.
    We seek comment on these conclusions, their implications for any
potential updates to battery pack costs for the final rule, and any
other external analyses that the agency should consider when validating
future battery pack cost projections.
    Next, each vehicle powertrain type also receives different non-
battery electrification components. When researching costs for
different non-battery electrification components, DOT found that
different reports vary in components considered and cost breakdown.
This is not surprising, as vehicle manufacturers use different non-
battery electrification components in different vehicle's systems, or
even in the same vehicle type, depending the application.\211\ DOT
developed costs for the major non-battery electrification components on
a dollar per kilowatt hour basis using the costs presented in two
reports. DOT used a $/kW cost metric for non-battery components to
align with the normalized costs for a system's peak power rating as
presented in U.S. DRIVE's Electrical and Electronics Technical Team
(EETT) Roadmap report.\212\ This approach captures components in some
manufacturer's systems, but not all systems; however, DOT believes this
is a reasonable metric and approach to use for this analysis given the
differences in non-battery electrification component systems. This
approach allows us to scale the cost of non-battery electrification
components based on the requirements of the system. We also relied on a
teardown study of a MY 2016 Chevrolet Bolt for non-battery component
costs that were not explicitly estimated in the EETT Roadmap
report.\213\
---------------------------------------------------------------------------

    \211\ For example, the MY 2020 Nissan Leaf does not have an
active cooling system whereas Chevy Bolt uses an active cooling
system.
    \212\ U.S. DRIVE, Electrical and Electronics Technical Team
Roadmap (Oct. 2017), available at https://www.energy.gov/sites/prod/files/2017/11/f39/EETT%20Roadmap%2010-27-17.pdf.
    \213\ Hummel et al., UBS Evidence Lab Electric Car Teardown--
Disruption Ahead?, UBS (May 18, 2017), https://neo.ubs.com/shared/d1wkuDlEbYPjF/.

---------------------------------------------------------------------------

    To develop the learning curves for non-battery electrification
components, DOT used cost information from Argonne's 2016 Assessment of
Vehicle Sizing, Energy Consumption, and Cost through Large-Scale
Simulation of Advanced Vehicle Technologies report.\214\ The report
provided estimated cost projections from the 2010 lab year to the 2045
lab year for individual vehicle components.215 216 DOT
considered the component costs used in electrified vehicles, and
determined the learning curve by evaluating the year over year cost
change for those components. Argonne recently published a 2020 version
of the same report that included high and low cost estimates for many
of the same components, that also included a learning rate.\217\ DOT's
learning estimates generated using the 2016 report fall fairly well in
the middle of these two ranges, and therefore staff decided that
continuing to apply the learning curve estimates based on the 2016
report was reasonable. There are many sources that DOT staff could have
picked to develop learning curves for non-battery electrification
component costs, however given the uncertainty surrounding
extrapolating costs out to MY 2050, DOT believes these learning curves
provide a reasonable estimate.
---------------------------------------------------------------------------

    \214\ Moawad, Ayman, Kim, Namdoo, Shidore, Neeraj, and Rousseau,
Aymeric. Assessment of Vehicle Sizing, Energy Consumption and Cost
Through Large Scale Simulation of Advanced Vehicle Technologies
(ANL/ESD-15/28). United States (2016). Available at https://www.autonomie.net/pdfs/Report%20ANL%20ESD-1528%20-%20Assessment%20of%20Vehicle%20Sizing,%20Energy%20Consumption%20and%20Cost%20through%20Large%20Scale%20Simulation%20of%20Advanced%20Vehicle%20Technologies%20-%201603.pdf.
    \215\ ANL/ESD-15/28 at 116.
    \216\ DOE's lab year equates to five years after a model year,
e.g., DOE's 2010 lab year equates to MY 2015.
    \217\ Islam, E., Kim, N., Moawad, A., Rousseau, A. ``Energy
Consumption and Cost Reduction of Future Light-Duty Vehicles through
Advanced Vehicle Technologies: A Modeling Simulation Study Through
2050'', Report to the U.S. Department of Energy, Contract ANL/ESD-
19/10, June 2020 https://www.autonomie.net/pdfs/ANL%20-%20Islam%20-%202020%20-%20Energy%20Consumption%20and%20Cost%20Reduction%20of%20Future%20Light-Duty%20Vehicles%20through%20Advanced%20Vehicle%20Technologies%20A%20Modeling%20Simulation%20Study%20Through%202050.pdf.
---------------------------------------------------------------------------

    Table III-21 shows an example of how the non-battery
electrification component costs are computed for the Medium Car and
Medium SUV non-performance vehicle classes.
BILLING CODE 4910-59-P
[GRAPHIC] [TIFF OMITTED] TP03SE21.066

    TSD Chapter <IP_ADDRESS> contains more information about the non-battery
electrification components relevant to each specific electrification
technology and the sources used to develop these costs. We seek comment
on these costs, the appropriateness of the sources used to develop
these costs, and the $/kW metric used to size specific non-battery
electrification components. In addition, we seek comment on the
learning rate applied to non-battery electrification components.
    Finally, the cost of electrifying a vehicle depends on the other
powertrain components that must be added or removed from a vehicle with
the addition of the electrification technology. Table III-22 below
provides a breakdown of each electrification component included for
each electrification technology type, as well as where to find the
costs in each CAFE Model input file.
[GRAPHIC] [TIFF OMITTED] TP03SE21.067

    As shown in Table III-22, DOT used the cost of the CVTL2 as a proxy
for the cost of an eCVT used in PS hybrid vehicles. In its recent 2021
report, the NAS estimated the cost of eCVTs to be lower than DOT's cost
estimate for CVTL2.\218\ DOT is investigating the cost assumptions used
for the PS hybrid transmission and may update those costs for the final
rule depending on information submitted by stakeholders or other
research. DOT seeks comment on the appropriateness of the cost estimate
for eCVTs in the 2021 NAS report, or any other data that could be made
public on the costs of eCVTs.
---------------------------------------------------------------------------

    \218\ A detailed cost comparison between our costs and the 2021
NAS report costs is discussed in TSD Chapter <IP_ADDRESS>.3.
---------------------------------------------------------------------------

    The following example in Table III-23 shows how the costs are
computed for a vehicle that progresses from a lower level to a higher
level of electrified powertrain. The table shows the components that
are removed and the components that are added as a GMC Acadia
progresses from a MY 2024 vehicle with only SS12V electrification
technology to a BEV300 in MY 2025. The total cost in MY 2025 is a net
cost addition to the vehicle. The same methodology could be used for
any other technology advancement in the electric technology tree
path.\219\
---------------------------------------------------------------------------

    \219\ Please note that in this calculation the CAFE Model
accounts for the air conditioning and off-cycle technologies (g/
mile) applied to each vehicle model. The cost for the AC/OC
adjustments are located in the CAFE Model Scenarios file. The air
conditioning and off-cycle cost values are discussed further in TSD
Chapter 3.8.

---------------------------------------------------------------------------

[GRAPHIC] [TIFF OMITTED] TP03SE21.068

BILLING CODE 4910-59-C
    TSD Chapter <IP_ADDRESS> includes more details about how the costs
associated with the internal combustion engine, transmission, electric
machine(s), non-battery electrification components, and battery pack
for each electrified technology type are combined to create a full
electrification system cost.
4. Mass Reduction
    Mass reduction is a relatively cost-effective means of improving
fuel economy, and vehicle manufacturers are expected to apply various
mass reduction technologies to meet fuel economy standards. Reducing
vehicle mass can be accomplished through several different techniques,
such as modifying and optimizing vehicle component and system designs,
part consolidation, and adopting lighter weight materials (advanced
high strength steel, aluminum, magnesium, and plastics including carbon
fiber reinforced plastics).
    The cost for mass reduction depends on the type and amount of
materials used, the manufacturing and assembly processes required, and
the degree to which changes to plants and new manufacturing and
assembly equipment is needed. In addition, manufacturers may develop
expertise and invest in certain mass reduction strategies that may
affect the approaches for mass reduction they consider and the
associated costs. Manufacturers may also consider vehicle attributes
like noise-vibration-harshness (NVH), ride quality, handling, crash
safety and various acceleration metrics when considering how to
implement any mass reduction strategy. These are considered to be
aspects of performance, and for this analysis any identified pathways
to compliance are intended to maintain performance neutrality.
Therefore, mass reduction via elimination of, for example, luxury items
such as climate control, or interior vanity mirrors, leather padding,
etc., is not considered in the mass reduction pathways for this
analysis.
    The automotive industry uses different metrics to measure vehicle
weight. Some commonly used measurements are vehicle curb weight,\220\
gross vehicle weight (GVW),\221\ gross vehicle weight rating
(GVWR),\222\ gross combined weight (GCVW),\223\ and equivalent test
weight (ETW),\224\ among others. The vehicle curb weight is the most
commonly used measurement when comparing vehicles. A vehicle's curb
weight is the weight of the vehicle including fluids, but without a
driver, passengers, and cargo. A vehicle's glider weight, which is
vehicle curb weight minus the powertrain weight, is used to track the
potential opportunities for weight reduction not including the
powertrain. A glider's subsystems may consist of the vehicle body,
chassis, interior, steering,

electrical accessory, brake, and wheels systems. The percentage of
weight assigned to the glider will remain constant for any given rule
but may change overall. For example, as electric powertrains including
motors, batteries, inverters, etc. become a greater percent of the
fleet, glider weight percentage will change compared to earlier fleets
with higher dominance of internal combustion engine (ICE) powertrains.
---------------------------------------------------------------------------

    \220\ This is the weight of the vehicle with all fluids and
components but without the drivers, passengers, and cargo.
    \221\ This weight includes all cargo, extra added equipment, and
passengers aboard.
    \222\ This is the maximum total weight of the vehicle,
passengers, and cargo to avoid damaging the vehicle or compromising
safety.
    \223\ This weight includes the vehicle and a trailer attached to
the vehicle, if used.
    \224\ For the EPA two-cycle regulatory test on a dynamometer, an
additional weight of 300 lbs is added to the vehicle curb weight.
This additional 300 lbs represents the weight of the driver,
passenger, and luggage. Depending on the final test weight of the
vehicle (vehicle curb weight plus 300 lbs), a test weight category
is identified using the table published by EPA according to 40 CFR
1066.805. This test weight category is called ``Equivalent Test
Weight'' (ETW).
---------------------------------------------------------------------------

    For this analysis, DOT considered six levels of mass reduction
technology that include increasing amounts of advanced materials and
mass reduction techniques applied to the glider. The mass change
associated with powertrain changes is accounted for separately. The
following sections discuss the assumptions for the six mass reduction
technology levels, the process used to assign initial analysis fleet
mass reduction assignments, the effectiveness for applying mass
reduction technology, and mass reduction costs.
(a) Mass Reduction in the CAFE Model
    The CAFE Model considers six levels of mass reduction technologies
that manufacturers could use to comply with CAFE standards. The
magnitude of mass reduction in percent for each of these levels is
shown in Table III-24 for mass reductions for light trucks, passenger
cars and for gliders.
[GRAPHIC] [TIFF OMITTED] TP03SE21.069

    For this analysis, DOT considers mass reduction opportunities from
the glider subsystems of a vehicle first, and then consider associated
opportunities to downsize the powertrain, which are accounted for
separately.\225\ As explained below, in the Autonomie simulations, the
glider system includes both primary and secondary systems from which a
percentage of mass is reduced for different glider weight reduction
levels; specifically, the glider includes the body, chassis, interior,
electrical accessories, steering, brakes and wheels. In this analysis,
DOT assumed the glider share is 71% of vehicle curb weight. The
Autonomie model sizes the powertrain based on the glider weight and the
mass of some of the powertrain components in an iterative process. The
mass of the powertrain depends on the powertrain size. Therefore, the
weight of the glider impacts the weight of the powertrain.\226\
---------------------------------------------------------------------------

    \225\ When the mass of the vehicle is reduced by an appropriate
amount, the engine may be downsized to maintain performance. See
Section III.C.4 for more details.
    \226\ Since powertrains are sized based on the glider weight for
the analysis, glider weight reduction beyond a threshold amount
during a redesign will lead to re-sizing of the powertrain. For the
analysis, the glider was used as a base for the application of any
type of powertrain. A conventional powertrain consists of an engine,
transmission, exhaust system, fuel tank, radiator and associated
components. A hybrid powertrain also includes a battery pack,
electric motor(s), generator, high voltage wiring harness, high
voltage connectors, inverter, battery management system(s), battery
pack thermal system, and electric motor thermal system.
---------------------------------------------------------------------------

    DOT uses glider weight to apply non-powertrain mass reduction
technology in the CAFE Model and use Autonomie simulations to determine
the size of the powertrain and corresponding powertrain weight for the
respective glider weight. The combination of glider weight (after mass
reduction) and re-sized powertrain weight equal the vehicle curb
weight.
    While there are a range of specific mass reduction technologies
that may be applied to vehicles to achieve each of the six mass
reduction levels, there are some general trends that are helpful to
illustrate some of the more widely used approaches. Typically, MR0
reflects vehicles with widespread use of mild steel structures and body
panels, and very little or no use of high strength steel or aluminum.
MR0 reflects materials applied to average vehicles in the MY 2008
timeframe. MR1-MR3 can be achieved with a steel body structure. In
going from MR1 to MR3, expect that mild steel to be replaced by high
strength and then advanced high strength steels. In going from MR3 to
MR4 aluminum is required. This will start at using aluminum closure
panels and then to get to MR4 the vehicle's primary structure will need
to be mostly made from aluminum. In the vast majority of cases, carbon
fiber technology is necessary to reach MR5, perhaps with a mix of some
aluminum. MR6 can really only be attained in anything resembling a
passenger car by make nearly every structural component from carbon
fiber. This mean the body structure and closure panels like hoods and
door skins are wholly made from carbon fiber. There may be some use of
aluminum in the suspension. TSD Chapter 3.4 includes more discussion of
the challenges involved with adopting large amounts of carbon fiber in
the vehicle fleet in the coming years.
    As discussed further below, the cost studies used to generate the
cost curves assume mass can be reduced in levels that require different
materials and different components to be utilized, in a specific order.
DOT's mass reduction levels are loosely based on what materials and
components that would be required to be used for each percent of mass
reduction, based on the conclusions of those studies.
(b) Mass Reduction Analysis Fleet Assignments
    To assign baseline mass reduction levels (MR0 through MR6) for
vehicles in the MY 2020 analysis fleet, DOT used previously developed
regression models to estimate curb weight for each vehicle based on
observable vehicle attributes.

DOT used these models to establish a baseline (MR0) curb weight for
each vehicle, and then determined the existing mass reduction
technology level by finding the difference between the vehicles actual
curb weight to the estimated regression-based value, and comparing the
difference to the values in Table III-24. DOT originally developed the
mass reduction regression models using MY 2015 fleet data; for this
analysis, DOT used MY 2016 and 2017 analysis fleet data to update the
models.
    DOT believes the regression methodology is a technically sound
approach for estimating mass reduction levels in the analysis fleet.
For a detailed discussion about the regression development and use
please see TSD Chapter 3.4.2.
    Manufacturers generally apply mass reduction technology at a
vehicle platform level (i.e., using the same components across multiple
vehicle models that share a common platform) to leverage economies of
scale and to manage component and manufacturing complexity, so
conducting the regression analysis at the platform level leads to more
accurate estimates for the real-world vehicle platform mass reduction
levels. The platform approach also addresses the impact of potential
weight variations that might exist for specific vehicle models, as all
the individual vehicle models are aggregated into the platform group,
and are effectively averaged using sales weighting, which minimizes the
impact of any outlier vehicle configurations.
(c) Mass Reduction Adoption Features
    Given the degree of commonality among the vehicle models built on a
single platform, manufacturers do not have complete freedom to apply
unique technologies to each vehicle that shares the platform. While
some technologies (e.g., low rolling resistance tires) are very nearly
``bolt-on'' technologies, others involve substantial changes to the
structure and design of the vehicle, and therefore affect all vehicle
models that share a platform. In most cases, mass reduction
technologies are applied to platform level components and therefore the
same design and components are used on all vehicle models that share
the platform.
    Each vehicle in the analysis fleet is associated with a specific
platform. Similar to the application of engine and transmission
technologies, the CAFE Model defines a platform ``leader'' as the
vehicle variant of a given platform that has the highest level of
observed mass reduction present in the analysis fleet. If there is a
tie, the CAFE Model begins mass reduction technology on the vehicle
with the highest sales volume in model year 2020. If there remains a
tie, the model begins by choosing the vehicle with the highest
manufacturer suggested retail price (MSRP) in MY 2020. As the model
applies technologies, it effectively levels up all variants on a
platform to the highest level of mass reduction technology on the
platform. For example, if the platform leader model is already at MR3
in MY 2020, and a ``follower'' platform model starts at MR0 in MY 2020,
the follower platform model will get MR3 at its next redesign, assuming
no further mass reduction technology is applied to the leader model
before the follower models next redesign.
    In addition to the platform-sharing logic employed in the model,
DOT applied phase-in caps for MR5 and MR6 (15 percent and 20 percent
reduction of a vehicle's curb weight, respectively), based on the
current state of mass reduction technology. As discussed above, for
nearly every type of vehicle, with the exception of the smallest sports
cars, a manufacturer's strategy to achieve mass reduction consistent
with MR5 and MR6 will require extensive use of carbon fiber
technologies in the vehicles' primary structures. For example, one way
of using carbon fiber technology to achieve MR6 is to develop a carbon
fiber monocoque structure. A monocoque structure is one where the outer
most skins support the primary loads of the vehicle. For example, they
do not have separate non-load bearing aero surfaces. All of the
vehicle's primary loads are supported by the monocoque. In the most
structurally efficient automotive versions, the monocoque is made from
multiple well-consolidated plies of carbon fiber infused with resin.
Such structures can require low hundreds of pounds of carbon fiber for
most passenger vehicles. Add to this another roughly equivalent mass of
petroleum-derived resins and even at aspirational prices for dry carbon
fiber of $10-20 per pound it is easy to see how direct materials alone
can easily climb into the five-figure dollar range per vehicle.
    High CAFE stringency levels will push the CAFE Model to select
compliance pathways that include these higher levels of mass reduction
for vehicles produced in the mid and high hundreds of thousands of
vehicles per year. DOT assumes, based on material costs and
availability, that achieving MR6 levels of mass reduction will cost
tens of thousands of dollars per car. Therefore, application of such
technology to high volume vehicles is unrealistic today and will, with
certainty, remain so for the next several years.
    The CAFE Model applies technologies to vehicles that provide a
cost-effective pathway to compliance. In some cases, the direct
manufacturing cost, indirect costs, and applied learning factor do not
capture all the considerations that make a technology more or less
costly for manufacturers to apply in the real world. For example, there
are direct labor, R&D overhead, manufacturing overhead, and amortized
tooling costs that will likely be higher for carbon fiber production
than current automotive steel production, due to fiber handling
complexities. In addition, R&D overhead will also increase because of
the knowledge base for composite materials in automotive applications
is simply not as deep as it is for steel and aluminum. Indeed, the
intrinsic anisotropic mechanical properties of composite materials
compared to the isotropic properties of metals complicates the design
process. Added testing of these novel anisotropic structures and their
associated costs will be necessary for decades. Adding up all these
contributing costs, the price tag for a passenger car or truck
monocoque would likely be multiple tens of thousands of dollars per
vehicle. This would be significantly more expensive than transitioning
to hybrid or fully electric powertrains and potentially less effective
at achieving CAFE compliance.
    In addition, the CAFE Model does not currently enable direct
accounting for the stranded capital associated with a transition away
from stamped sheet metal construction to molded composite materials
construction. For decades, or in some cases half-centuries, car
manufacturers have invested billions of dollars in capital for
equipment that supports the industry's sheet metal forming paradigm. A
paradigm change to tooling and equipment developed to support molding
carbon fiber panels and monocoque chassis structures would leave that
capital stranded in equipment that would be rendered obsolete. Doing
this is possible, but the financial ramifications are not currently
reflected in the CAFE Model for MR5 and MR6 compliance pathways.
    Financial matters aside, carbon fiber technology and how it is best
used to produce lightweight primary automotive structures is far from
mature. In fact, no car company knows for sure the best way to use
carbon fiber to make a passenger car's primary structure. Using this
technology in passenger cars is far more complex than using it in
racing cars where passenger egress, longevity, corrosion protection,
crash protection,

etc. are lower on the list of priorities for the design team. BMW may
be the manufacturer most able accurately opine on the viability of
carbon fiber technology for primary structure on high-volume passenger
cars, and even it decided to use a mixed materials solution for their
next generation of EVs (the iX and i4) after the i3, thus eschewing a
wholly carbon fiber monocoque structure.
    Another factor limiting the application of carbon fiber technology
to mass volume passenger vehicles is indeed the availability of dry
carbon fibers. There is high global demand from a variety of industries
for a limited supply of carbon fibers. Aerospace, military/defense, and
industrial applications demand most of the carbon fiber currently
produced. Today, only roughly 10% of the global dry fiber supply goes
to the automotive industry, which translates to the global supply base
only being able to support approximately 70k cars.\227\
---------------------------------------------------------------------------

    \227\ J. Sloan, ``Carbon Fiber Suppliers Gear up for Next
Generation Growth,'' compositesworld.com, February 11, 2020.
---------------------------------------------------------------------------

    To account for these cost and production considerations, including
the limited global supply of dry carbon fiber, DOT applied phase-in
caps that limited the number of vehicles that can achieve MR5 and M6
levels of mass reduction in the CAFE Model. DOT applied a phase-in cap
for MR5 level technology so that 75 percent of the vehicle fleet
starting in 2020 could employ the technology, and the technology could
be applied to 100 percent of the fleet by MY 2022. DOT also applied a
phase-in cap for MR6 technology so that five percent of the vehicle
fleet starting in MY 2020 could employ the technology, and the
technology could be applied to 10 percent of the fleet by MY 2025.
    To develop these phase-in caps, DOT chose a 40,000 unit thresholds
for both MR5 and MR6 technology (80,000 units total), because it
roughly reflects the number of BMW i3 cars produced per year
worldwide.\228\ As discussed above, the BMW i3 is the only high-volume
vehicle currently produced with a primary structure mostly made from
carbon fiber (except the skateboard, which is aluminum). Because mass
reduction is applied at the platform level (meaning that every car of a
given platform would receive the technology, not just special low
volume versions of that platform), only platforms representing 40,000
vehicles or less are eligible to apply MR5 and MR6 toward CAFE
compliance. Platforms representing high volume sales, like a Chevrolet
Traverse, for example, where hundreds of thousands are sold per year,
are therefore blocked from access to MR5 and MR6 technology. There are
no phase in caps for mass reduction levels MR1, MR2, MR3, or MR4.
---------------------------------------------------------------------------

    \228\ However, even this number is optimistic because only a
small fraction of i3 cars are sold in the U.S. market, and combining
MR5 and MR6 allocations equates to 80k vehicles, not 40k.
Regardless, if the auto industry ever seriously committed to using
carbon fiber in mainstream high-volume vehicles, competition with
the other industries would rapidly result in a dramatic increase in
price for dry fiber. This would further stymie the deployment of
this technology in the automotive industry.
---------------------------------------------------------------------------

    In addition to determining that the caps were reasonable based on
current global carbon fiber production, DOT determined that the MR5
phase-in cap is consistent with the DOT lightweighting study that found
that a 15 percent curb weight reduction for the fleet is possible
within the rulemaking timeframe.\229\
---------------------------------------------------------------------------

    \229\ Singh, Harry. (2012, August). Mass Reduction for Light-
Duty Vehicles for Model Years 2017-2025. (Report No. DOT HS 811
666). Program Reference: DOT Contract DTNH22-11-C-00193. Contract
Prime: Electricore, Inc, at 356, Figure 397.
---------------------------------------------------------------------------

    These phase-in caps appropriately function as a proxy for the cost
and complexity currently required (and that likely will continue to be
required until manufacturing processes evolve) to produce carbon fiber
components. Again, MR6 technology in this analysis reflects the use of
a significant share of carbon fiber content, as seen through the BMW i3
and Alfa Romeo 4c as discussed above.
    Given the uncertainty and fluid nature of knowledge around higher
levels of mass reduction technology, DOT welcomes comments on how to
most cost effectively use carbon fiber technology in high-volume
passenger cars. Financial implementation estimates for this technology
are equally as welcome.
(d) Mass Reduction Effectiveness Modeling
    As discussed in Section III.C.4, Argonne developed a database of
vehicle attributes and characteristics for each vehicle technology
class that included over 100 different attributes. Some examples from
these 100 attributes include frontal area, drag coefficient, fuel tank
weight, transmission housing weight, transmission clutch weight, hybrid
vehicle components, and weights for components that comprise engines
and electric machines, tire rolling resistance, transmission gear
ratios, and final drive ratio. Argonne used these attributes to
``build'' each vehicle that it used for the effectiveness modeling and
simulation. Important for precisely estimating the effectiveness of
different levels of mass reduction is an accurate list of initial
component weights that make up each vehicle subsystem, from which
Autonomie considered potential mass reduction opportunities.
    As stated above, glider weight, or the vehicle curb weight minus
the powertrain weight, is used to determine the potential opportunities
for weight reduction irrespective of the type of powertrain.\230\ This
is because weight reduction can vary depending on the type of
powertrain. For example, an 8-speed transmission may weigh more than a
6-speed transmission, and a basic engine without variable valve timing
may weigh more than an advanced engine with variable valve timing.
Autonomie simulations account for the weight of the powertrain system
inherently as part of the analysis, and the powertrain mass accounting
is separate from the application and accounting for mass reduction
technology levels that are applied to the glider in the simulations.
Similarly, Autonomie also accounts for battery and motor mass used in
hybrid and electric vehicles separately. This secondary mass reduction
is discussed further below.
---------------------------------------------------------------------------

    \230\ Depending on the powertrain combination, the total curb
weight of the vehicle includes glider, engine, transmission and/or
battery pack and motor(s).
---------------------------------------------------------------------------

    Accordingly, in the Autonomie simulations, mass reduction
technology is simulated as a percentage of mass removed from the
specific subsystems that make up the glider, as defined for that set of
simulations (including the non-powertrain secondary mass systems such
as the brake system). For the purposes of determining a reasonable
percentage for the glider, DOT in consultation with Argonne examined
glider weight data available in the A2Mac1 database,\231\ in addition
to the NHTSA MY 2014 Chevrolet Silverado lightweighting study
(discussed further below). Based on these studies, DOT assumed that the
glider weight comprised 71 percent of the vehicle curb weight. TSD
Chapter 3.4.4 includes a detailed breakdown of the components that DOT
considered to arrive at the conclusion that a glider, on average,
represents 71% of a vehicle's curb weight.
---------------------------------------------------------------------------

    \231\ A2Mac1: Automotive Benchmarking, https://a2mac1.com.
---------------------------------------------------------------------------

    Any mass reduction due to powertrain improvements is accounted for
separately from glider mass reduction. Autonomie considers several
components for powertrain mass reduction, including engine downsizing,

and transmission, fuel tank, exhaust systems, and cooling system
lightweighting.
    The 2015 NAS report suggested an engine downsizing opportunity
exists when the glider mass is lightweighted by at least 10%. The 2015
NAS report also suggested that 10% lightweighting of the glider mass
alone would boost fuel economy by 3% and any engine downsizing
following the 10% glider mass reduction would provide an additional 3%
increase in fuel economy.\232\ The 2011 Honda Accord and 2014 Chevrolet
Silverado lightweighting studies applied engine downsizing (for some
vehicle types but not all) when the glider weight was reduced by 10
percent. Accordingly, this analysis limited engine resizing to several
specific incremental technology steps as in the 2018 CAFE NPRM (83 FR
42986, Aug. 24, 2018) and 2020 final rule; important for this
discussion, engines in the analysis were only resized when mass
reduction of 10% or greater was applied to the glider mass, or when one
powertrain architecture was replaced with another architecture.
---------------------------------------------------------------------------

    \232\ National Research Council. 2015. Cost, Effectiveness, and
Deployment of Fuel Economy Technologies for Light-Duty Vehicles.
Washington, DC--The National Academies Press. https://doi.org/10.17226/21744.
---------------------------------------------------------------------------

    Specifically, we allow engine resizing upon adoption of 7.1%,
10.7%, 14.2%, and 20% curb weight reduction, but not at 3.6% and
5.3%.\233\ Resizing is also allowed upon changes in powertrain type or
the inheritance of a powertrain from another vehicle in the same
platform. The increments of these higher levels of mass reduction, or
complete powertrain changes, more appropriately match the typical
engine displacement increments that are available in a manufacturer's
engine portfolio.
---------------------------------------------------------------------------

    \233\ These curb weight reductions equate to the following
levels of mass reduction as defined in the analysis: MR3, MR4, MR5
and MR6, but not MR1 and MR2; additional discussion of engine
resizing for mass reduction can be found in Section III.C.4 and TSD
Chapter 2.4.
---------------------------------------------------------------------------

    Argonne performed a regression analysis of engine peak power versus
weight for a previous analysis based on attribute data taken from the
A2Mac1 benchmarking database, to account for the difference in weight
for different engine types. For example, to account for weight of
different engine sizes like 4-cylinder versus 8-cylinder, Argonne
developed a relationship curve between peak power and engine weight
based on the A2Mac1 benchmarking data. We use this relationship to
estimate mass for all engine types regardless of technology type (e.g.,
variable valve lift and direct injection). DOT applied weight
associated with changes in engine technology by using this linear
relationship between engine power and engine weight from the A2Mac1
benchmarking database. When a vehicle in the analysis fleet with an 8-
cylinder engine adopted a more fuel-efficient 6-cylinder engine, the
total vehicle weight would reflect the updated engine weight with two
less cylinders based on the peak power versus engine weight
relationship.
    When Autonomie selects a powertrain combination for a lightweighted
glider, the engine and transmission are selected such that there is no
degradation in the performance of the vehicle relative to the baseline
vehicle. The resulting curb weight is a combination of the
lightweighted glider with the resized and potentially new engine and
transmission. This methodology also helps in accurately accounting for
the cost of the glider and cost of the engine and transmission in the
CAFE Model.
    Secondary mass reduction is possible from some of the components in
the glider after mass reduction has been incorporated in primary
subsystems (body, chassis, and interior). Similarly, engine downsizing
and powertrain secondary mass reduction is possible after certain level
of mass reduction is incorporated in the glider. For the analysis, the
agencies include both primary mass reduction, and when there is
sufficient primary mass reduction, additional secondary mass reduction.
The Autonomie simulations account for the aggregate of both primary and
secondary glider mass reduction, and separately for powertrain mass.
    Note that secondary mass reduction is integrated into the mass
reduction cost curves. Specifically, the NHTSA studies, upon which the
cost curves depend, first generated costs for lightweighting the
vehicle body, chassis, interior, and other primary components, and then
calculated costs for lightweighting secondary components. Accordingly,
the cost curves reflect that, for example, secondary mass reduction for
the brake system is only applied after there has been sufficient
primary mass reduction to allow the smaller brake system to provide
safe braking performance and to maintain mechanical functionality.
    DOT enhanced the accuracy of estimated engine weights by creating
two curves to represent separately naturally aspirated engine designs
and turbocharged engine designs.\234\ This achieves two benefits.
First, small naturally aspirated 4-cylinder engines that adopted
turbocharging technology reflected the increased weight of associated
components like ducting, clamps, the turbocharger itself, a charged air
cooler, wiring, fasteners, and a modified exhaust manifold. Second,
larger cylinder count engines like naturally aspirated 8-cylinder and
6-cylinder engines that adopted turbocharging and downsized
technologies would have lower weight due to having fewer engine
cylinders. For this analysis, a naturally aspirated 8-cylinder engine
that adopts turbocharging technology and is downsized to a 6-cylinder
turbocharged engine appropriately reflects the added weight of the
turbocharging components, and the lower weight of fewer cylinders.
---------------------------------------------------------------------------

    \234\ See Autonomie model documentation, Chapter 5.2.9. Engine
Weight Determination.
---------------------------------------------------------------------------

    The range of effectiveness values for the mass reduction
technologies, for all ten vehicle technology classes are shown in
Figure III-13. In the graph, the box shows the inner quartile range
(IQR) of the effectiveness values and whiskers extend out 1.5 x IQR.
The dots outside of the whiskers show a few values outside these
ranges. As discussed earlier, Autonomie simulates all possible
combinations of technologies for fuel consumption improvements. For a
few technology combinations mass reduction has minimal impact on
effectiveness on the regulatory 2-cycle test. For example, if an engine
is operating in an efficient region of the fuel map on the 2-cycle test
further reduction of mass may have smaller improvement on the
regulatory cycles. Figure III-13 shows the range improvements based on
the full range of other technology combinations considered in the
analysis.

[GRAPHIC] [TIFF OMITTED] TP03SE21.070

(e) Mass Reduction Costs
    The CAFE Model analysis handles mass reduction technology costs
differently than all other technology costs. Mass reduction costs are
calculated as an average cost per pound over the baseline (MR0) for a
vehicle's glider weight. While the definitions of glider may vary, DOT
referenced the same dollar per pound of curb weight to develop costs
for different glider definitions. In translating these values, DOT took
care to track units ($/kg vs. $/lb) and the reference for percentage
improvements (glider vs. curb weight).
    DOT calculated the cost of mass reduction on a glider weight basis
so that the weight of each powertrain configuration could be directly
and separately accounted for. This approach provides the true cost of
mass reduction without conflating the mass change and costs associated
with downsizing a powertrain or adding additional advanced powertrain
technologies. Hence, the mass reduction costs in this proposal reflect
the cost of mass reduction in the glider and do not include the mass
reduction associated with engine downsizing. The mass reduction and
costs associated with engine downsizing are accounted for separately.
    A second reason for using glider share instead of curb weight is
that it affects the absolute amount of curb weight reduction applied,
and therefore cost per pound for the mass reduction changes with the
change in the glider share. The cost for removing 20 percent of the
glider weight when the glider represents 75 percent of a vehicle's curb
weight is not the same as the cost for removing 20 percent of the
glider weight when the glider represents 50 percent of the vehicle's
curb weight. For example, the glider share of 79 percent of a 3,000-
pound curb weight vehicle is 2,370 lbs, while the glider share of 50
percent of a 3,000-pound curb weight vehicle is 1,500 lbs, and the
glider share of 71 percent of a 3,000-pound curb weight vehicle is
2,130 lbs. The mass change associated with 20 percent mass reduction is
474 lbs for 79 percent glider share (=[3,000 lbs x 79% x 20%]), 300 lbs
for 50 percent glider share (=[3,000 lbs x 50% x 20%]), and 426 lbs for
71 percent glider share (=[3,000 lbs x 71% x 20%]). The mass reduction
cost studies that DOT relied on to develop mass reduction costs for
this analysis show that the cost for mass reduction varies with the
amount of mass reduction. Therefore, for a fixed glider mass reduction
percentage, different glider share assumptions will have different
costs.
    DOT considered several sources to develop the mass reduction
technology cost curves. Several mass reduction studies have used either
a mid-size passenger car or a full-size pickup truck as an exemplar
vehicle to demonstrate the technical and cost feasibility of mass
reduction. While the findings of these studies may not apply directly
to different vehicle classes, the cost estimates derived for the mass
reduction technologies identified in these studies can be useful for
formulating general estimates of costs. As discussed further below, the
mass reduction cost curves developed for this analysis are based on two
lightweighting studies, and DOT also updated the curves based on more

recent studies to better account for the cost of carbon fiber needed
for the highest levels of mass reduction technology. The two studies
used for MR1 through MR4 costs included the teardown of a MY 2011 Honda
Accord and a MY 2014 Chevrolet Silverado pickup truck, and the carbon
fiber costs required for MR5 and MR6 were updated based on the 2021 NAS
report.\235\
---------------------------------------------------------------------------

    \235\ This analysis applied the cost estimates per pound derived
from passenger cars to all passenger car segments, and the cost
estimates per pound derived from full-size pickup trucks to all
light-duty truck and SUV segments. The cost estimates per pound for
carbon fiber (MR5 and MR6) were the same for all segments.
---------------------------------------------------------------------------

    Both teardown studies are structured to derive the estimated cost
for each of the mass reduction technology levels. DOT relied on the
results of those studies because they considered an extensive range of
material types, material gauge, and component redesign while taking
into account real world constraints such as manufacturing and assembly
methods and complexity, platform-sharing, and maintaining vehicle
utility, functionality and attributes, including safety, performance,
payload capacity, towing capacity, handling, NVH, and other
characteristics. In addition, DOT determined that the baseline vehicles
and mass reduction technologies assessed in the studies are still
reasonably representative of the technologies that may be applied to
vehicles in the MY 2020 analysis fleet to achieve up to MR4 level mass
reduction in the rulemaking timeframe. DOT adjusted the cost estimates
derived from the two studies to reflect the assumption that a vehicle's
glider weight consisted of 71% of the vehicle's curb weight, and mass
reduction as it pertains to achieving MR0-MR6 levels would only come
from the glider.
    As discussed above, achieving the highest levels of mass reduction
often necessitates extensive use of advanced materials like higher
grades of aluminum, magnesium, or carbon fiber. For the 2020 final
rule, DOT provided a survey of information available regarding carbon
fiber costs compared to the costs DOT presented in the final rule based
on the Honda Accord and Chevrolet Silverado teardown studies. In the
Honda Accord study, the estimated cost of carbon fiber was $5.37/kg,
and the cost of carbon fiber used in the Chevy Silverado study was
$15.50/kg. The $15.50 estimate closely matched the cost estimates from
a BMW i3 teardown analysis,\236\ the cost figures provided by Oak Ridge
National Laboratory for a study from the IACMI Composites
Institute,\237\ and from a Ducker Worldwide presentation at the CAR
Management Briefing Seminar.\238\
---------------------------------------------------------------------------

    \236\ Singh, Harry, FSV Body Structure Comparison with 2014 BMW
i3, Munro and Associates for World Auto Steel (June 3, 2015).
    \237\ IACMI Baseline Cost and Energy Metrics (March 2017),
available at https://iacmi.org/wp-content/uploads/2017/12/IACMI-Baseline-Cost-and-Energy-Metrics-March-2017.pdf.
    \238\ Ducker Worldwide, The Road Ahead--Automotive Materials
(2016), https://societyofautomotiveanalysts.wildapricot.org/resources/Pictures/SAA%20Sumit%20slides%20for%20Abey%20Abraham%20of%20Ducker.pdf.
---------------------------------------------------------------------------

    For this analysis, DOT relied on the cost estimates for carbon
fiber construction that the National Academies detailed in the 2021
Assessment of Technologies for Improving Fuel Economy of Light-Duty
Vehicles--Phase 3 recently completed by the National Academies.\239\
The study indicates that the sum of direct materials costs plus
manufacturing costs for carbon fiber composite automotive components is
$25.97 per pound in high volume production. In order to use this cost
in the CAFE Model it must be put in terms of dollars per pound saved.
Using an average vehicle curb weight of 4000 lbs, a 71% glider share
and the percent mass savings associated with MR5 and MR6, it is
possible to calculate the number of pounds to be removed to attain MR5
and MR6. Also taken from the NAS study is the assertion that carbon
fiber substitution for steel in an automotive component results in a
50% mass reduction. Combining all this together, carbon fiber
technology offers weight savings at $24.60 per pound saved. This dollar
per pound savings figure must also be converted to a retail price
equivalent (RPE) to account for various commercial costs associated
with all automotive components. This is accomplished by multiplying
$24.60 by the factor 1.5. This brings the cost per pound saved for
using carbon fiber to $36.90 per pound saved.\240\ The analysis uses
this cost for achieving MR5 and MR6.
---------------------------------------------------------------------------

    \239\ 2021 NAS report, at 7-242-3.
    \240\ See MR5 and MR6 CFRP Cost Increase Calculator.xlsx in the
docket for this action.
---------------------------------------------------------------------------

    Table III-25 and Table III-26 show the cost values (in dollars per
pound) used in the CAFE Model with MR1-4 costs based on the cost curves
developed from the MY 2011 Honda Accord and MY 2014 Chevrolet Silverado
studies, and the updated MR5 and MR6 values that account for the
updated carbon fiber costs from the 2021 NAS report. Both tables assume
a 71% glider share.
[GRAPHIC] [TIFF OMITTED] TP03SE21.071

[GRAPHIC] [TIFF OMITTED] TP03SE21.072

    There is a dramatic increase in cost going from MR4 to MR5 and MR6
for all classes of vehicles. However, while the increase in cost going
from MR4 to MR5 and MR6 is dramatic, the MY 2011 Honda Accord study,
the MY 2014 Chevrolet Silverado study, and the 2021 NAS report all
included a steep increase to achieve the highest levels of mass
reduction technology. As noted above, DOT seeks comment on any
additional information about the costs of achieving the highest levels
of mass reduction technology, including from publicly available sources
or data that could be made publicly available.
    Table III-27 provides an example of mass reduction costs in 2018$
over select model years for the medium car and pickup truck technology
classes as a dollar per pound value. The table shows how the $/lb value
for each mass reduction level decreases over time because of cost
learning. For a full list of the $/lb mass reduction costs used in the
analysis across all model years, see the Technologies file.
[GRAPHIC] [TIFF OMITTED] TP03SE21.073

5. Aerodynamics
    The energy required to overcome aerodynamic drag accounts for a
significant portion of the energy consumed by a vehicle and can become
the dominant factor for a vehicle's energy consumption at high speeds.
Reducing aerodynamic drag can, therefore, be an effective way to reduce
fuel consumption and emissions.
    Aerodynamic drag is proportional to the frontal area (A) of the
vehicle and coefficient of drag (Cd), such that aerodynamic
performance is often expressed as the product of the two values,
CdA, which is also known as the drag area of a vehicle. The
coefficient of drag (Cd) is a dimensionless value that
essentially represents the aerodynamic efficiency of the vehicle shape.
The frontal area (A) is the cross-sectional area of the vehicle as
viewed from the front. It acts with the coefficient of drag as a sort
of scaling factor, representing the relative size of the vehicle shape
that the coefficient of drag describes. The force imposed by
aerodynamic drag increases with the square of vehicle velocity,
accounting for the largest contribution to road loads at higher speeds.
    Aerodynamic drag reduction can be achieved via two approaches,
either by reducing the drag coefficient or reducing vehicle frontal
area, with two different categories of technologies, passive and active
aerodynamic technologies. Passive aerodynamics refers to aerodynamic
attributes that are inherent to the shape and size of the vehicle,
including any components of a fixed nature. Active aerodynamics refers
to technologies that variably deploy in response to driving conditions.
These include technologies such as active grille shutters, active air
dams, and active ride height adjustment. It is important to note that
manufacturers may employ both passive and active aerodynamic
technologies to achieve aerodynamic drag values.
    The greatest opportunity for improving aerodynamic performance is
during a vehicle redesign cycle when significant changes to the shape
and size of the vehicle can be made. Incremental improvements may also
be achieved during mid-cycle vehicle refresh using restyled exterior
components and add-on devices. Some examples of potential technologies
applied during mid-cycle refresh are restyled front and rear fascia,
modified front air dams and rear valances, addition of rear deck lips
and underbody panels, and low-drag exterior mirrors. While
manufacturers may nudge the frontal area of the vehicle during
redesigns, large changes in frontal area are typically not possible
without impacting the utility and interior space of the vehicle.
Similarly, manufacturers may improve Cd by changing the
frontal shape of the vehicle or lowering the height of the vehicle,
among other approaches, but the form drag of certain body styles and
airflow needs for engine cooling often limit how much Cd may
be improved.
    The following sections discuss the four levels of aerodynamic
improvements considered in the CAFE Model, how the agency assigned
baseline aerodynamic technology levels to vehicles in the MY 2020
fleet, the effectiveness improvements for the addition of aerodynamic
technologies to vehicles, and the costs for adding that aerodynamic
technology.
(a) Aerodynamic Technologies in the CAFE Model
    DOT bins aerodynamic improvements into four levels--5%, 10%, 15%
and 20% aerodynamic drag improvement values over a baseline computed
for each vehicle body style--which correspond to AERO5, AERO10, AERO15,
and AERO20, respectively.
    The aerodynamic improvements technology pathway consists of a
linear progression, with each level superseding all previous levels, as
seen in Figure III-14.

[GRAPHIC] [TIFF OMITTED] TP03SE21.074

    While the four levels of aerodynamic improvements are technology-
agnostic, DOT built a pathway to compliance for each level based on
aerodynamic data from a National Research Council (NRC) of Canada-
sponsored wind tunnel testing program. The program included an
extensive review of production vehicles utilizing these technologies,
and industry comments.241 242 Again, these technology
combinations are intended to show a potential way for a manufacturer to
achieve each aerodynamic improvement level; however, in the real world,
manufacturers may implement different combinations of aerodynamic
technologies to achieve a percentage improvement over their baseline
vehicles.
---------------------------------------------------------------------------

    \241\ Larose, G., Belluz, L., Whittal, I., Belzile, M. et al.,
``Evaluation of the Aerodynamics of Drag Reduction Technologies for
Light-duty Vehicles--a Comprehensive Wind Tunnel Study,'' SAE Int.
J. Passeng. Cars--Mech. Syst. 9(2):772-784, 2016, https://doi.org/10.4271/2016-01-1613.
    \242\ Larose, Guy & Belluz, Leanna & Whittal, Ian & Belzile,
Marc & Klomp, Ryan & Schmitt, Andreas. (2016). Evaluation of the
Aerodynamics of Drag Reduction Technologies for Light-duty
Vehicles--a Comprehensive Wind Tunnel Study. SAE International
Journal of Passenger Cars--Mechanical Systems. 9. 10.4271/2016-01-
1613.
---------------------------------------------------------------------------

    Table III-28 and Table III-29 show the aerodynamic technologies
that could be used to achieve 5%, 10%, 15% and 20% improvements in
passenger cars, SUVs, and pickup trucks. As discussed further in
Section III.D.5.c, AERO20 cannot be applied to pickup trucks in the
model, which is why there is no pathway to AERO20 shown in Table III-
29. While some aerodynamic improvement technologies can be applied
across vehicle classes, like active grille shutters (used in the 2015
Chevrolet Colorado),\243\ DOT determined that there are limitations
that make it infeasible for vehicles with some body styles to achieve a
20% reduction in the coefficient of drag from their baseline. This
technology path is an example of how a manufacturer could reach each
AERO level, but they would not necessarily be required to use the
technologies.
---------------------------------------------------------------------------

    \243\ Chevrolet Product Information, available at https://media.chevrolet.com/content/media/us/en/chevrolet/vehicles/colorado/2015/_jcr_content/iconrow/textfile/file.res/15-PG-Chevrolet-Colorado-082218.pdf.

---------------------------------------------------------------------------

[GRAPHIC] [TIFF OMITTED] TP03SE21.075

[GRAPHIC] [TIFF OMITTED] TP03SE21.076

BILLING CODE 4910-59-C
    As discussed further in Section III.D.8, this analysis assumes
manufacturers apply off-cycle technology at rates defined in the Market
Data file. While the AERO levels in the analysis are technology-
agnostic, achieving AERO20 improvements does assume the use of active
grille shutters, which is an off-cycle technology.
(b) Aerodynamics Analysis Fleet Assignments
    DOT uses a relative performance approach to assign an initial level
of aerodynamic drag reduction technology to each vehicle. Each AERO
level represents a percent reduction in a vehicle's aerodynamic drag
coefficient (Cd) from a baseline value for its body style.
For a vehicle to achieve AERO5, the Cd must be at least 5%
below the baseline for the body style; for AERO10, 10% below the
baseline, and so on. Baseline aerodynamic assignment is therefore a
three step process: Each vehicle in the fleet is assigned a body style,
the average drag coefficient is calculated for each body style, and the
drag coefficient for each vehicle model is compared to the average for
the body style.
    Every vehicle in the fleet is assigned a body style; available body
styles included convertible, coupe, sedan, hatchback, wagon, SUV,
pickup, minivan, and van. These assignments do not necessarily match
the body styles used by manufacturers for marketing purposes. Instead,
they are assigned based on analyst judgement, taking into account how a
vehicle's AERO and vehicle technology class assignments are affected.
Different body styles offer different utility and have varying levels

of baseline form drag. In addition, frontal area is a major factor in
aerodynamic forces, and the frontal area varies by vehicle. This
analysis considers both frontal area and body style as utility factors
affecting aerodynamic forces; therefore, the analysis assumes all
reduction in aerodynamic drag forces come from improvement in the drag
coefficient.
    Average drag coefficients for each body style were computed using
the MY 2015 drag coefficients published by manufacturers, which were
used as the baseline values in the analysis. DOT harmonizes the
Autonomie simulation baselines with the analysis fleet assignment
baselines to the fullest extent possible.\244\
---------------------------------------------------------------------------

    \244\ See TSD Chapter 2.4.1 for a table of vehicle attributes
used to build the Autonomie baseline vehicle models. That table
includes a drag coefficient for each vehicle class.
---------------------------------------------------------------------------

    The drag coefficients used for each vehicle in the MY 2020 analysis
fleet are sourced from manufacturer specification sheets, when
possible. However, drag coefficients for the MY 2020 vehicles were not
consistently reported publicly. If no drag coefficient was reported,
analyst judgment is sometimes used to assign an AERO level. If no level
was manually assigned, the drag coefficient obtained from manufacturers
to build the MY 2016 fleet,\245\ was used, if available. The MY 2016
drag coefficient values may not accurately reflect the current
technology content of newer vehicles but are, in many cases, the most
recent data available.
---------------------------------------------------------------------------

    \245\ See 83 FR 42986 (Aug. 24, 2018). The MY 2016 fleet was
built to support the 2018 NPRM.
---------------------------------------------------------------------------

(c) Aerodynamics Adoption Features
    As already discussed, DOT engineers use a relative performance
approach to assign current aerodynamic technology (AERO) level to a
vehicle. For some body styles with different utility, such as pickup
trucks, SUVs and minivans, frontal area can vary, and this can affect
the overall aerodynamic drag forces. In order to maintain vehicle
utility and functionality related to passenger space and cargo space,
we assume all technologies that improve aerodynamic drag forces do so
by reducing Cd while maintaining frontal area.
    Technology pathway logic for levels of aerodynamic improvement
consists of a linear progression, with each level superseding all
previous ones. Technology paths for AERO are illustrated in Figure III-
14.
    The highest levels of AERO are not considered for certain body
styles. In these cases, this means that AERO20, and sometimes AERO15,
can neither be assigned in the baseline fleet nor adopted by the model.
For these body styles, there are no commercial examples of drag
coefficients that demonstrate the required AERO15 or AERO20 improvement
over baseline levels. DOT also deemed the most advanced levels of
aerodynamic drag simulated as not technically practicable given the
form drag of the body style and costed technology, especially given the
need to maintain vehicle functionality and utility, such as interior
volume, cargo area, and ground clearance. In short, DOT `skipped'
AERO15 for minivan body styles, and `skipped' AERO20 for convertible,
minivan, pickup, and wagon body styles.
    DOT also does not allow application of AERO15 and AERO20 technology
to vehicles with more than 780 horsepower. There are two main types of
vehicles that informed this threshold: performance internal combustion
engine (ICE) vehicles and high-power battery electric vehicles (BEVs).
In the case of the former, the agency recognizes that manufacturers
tune aerodynamic features on these vehicles to provide desirable
downforce at high speeds and to provide sufficient cooling for the
powertrain, rather than reducing drag, resulting in middling drag
coefficients despite advanced aerodynamic features. Therefore,
manufacturers may have limited ability to improve aerodynamic drag
coefficients for high performance vehicles with internal combustion
engines without reducing horsepower. The baseline fleet includes 1,655
units of sales volume with limited application of aerodynamic
technologies because of ICE vehicle performance.\246\
---------------------------------------------------------------------------

    \246\ Market Data file.
---------------------------------------------------------------------------

    In the case of high-power battery electric vehicles, the 780-
horsepower threshold is set above the highest peak system horsepower
present on a BEV in the 2020 fleet. BEVs have different aerodynamic
behavior and considerations than ICE vehicles, allowing for features
such as flat underbodies that significantly reduce drag.\247\ BEVs are
therefore more likely to achieve higher AERO levels, so the horsepower
threshold is set high enough that it does not restrict AERO15 and
AERO20 application. Note that the CAFE Model does not force high levels
of AERO adoption; rather, higher AERO levels are usually adopted
organically by BEVs because significant drag reduction allows for
smaller batteries and, by extension, cost savings. BEVs represent
252,023 units of sales volume in the baseline fleet.\248\
---------------------------------------------------------------------------

    \247\ 2020 EPA Automotive Trends Report, at 227.
    \248\ Market Data file.
---------------------------------------------------------------------------

(d) Aerodynamics Effectiveness Modeling
    To determine aerodynamic effectiveness, the CAFE Model and
Autonomie used individually assigned road load technologies for each
vehicle to appropriately assign initial road load levels and
appropriately capture benefits of subsequent individual road load
improving technologies.
    The current analysis included four levels of aerodynamic
improvements, AERO5, AERO10, AERO15, and AERO20, representing 5, 10,
15, and 20 percent reduction in drag coefficient (Cd),
respectively. DOT assumed that aerodynamic drag reduction could only
come from reduction in Cd and not from reduction of frontal
area, to maintain vehicle functionality and utility, such as passenger
space, ingress/egress ergonomics, and cargo space.
    The effectiveness values for the aerodynamic improvement levels
relative to AERO0, for all ten vehicle technology classes, are shown in
Figure III-15. Each of the effectiveness values shown is representative
of the improvements seen for upgrading only the listed aerodynamic
technology level for a given combination of other technologies. In
other words, the range of effectiveness values seen for each specific
technology (e.g., AERO 15) represents the addition of AERO15 technology
(relative to AERO0 level) for every technology combination that could
select the addition of AERO15. It must be emphasized that the change in
fuel consumption values between entire technology keys is used,\249\
and not the individual technology effectiveness values. Using the
change between whole technology keys captures the complementary or non-
complementary interactions among technologies. The box shows the inner
quartile range (IQR) of the effectiveness values and whiskers extend
out 1.5 x IQR. The dots outside the whiskers show effectiveness values
outside those thresholds.
---------------------------------------------------------------------------

    \249\ Technology key is the unique collection of technologies
that constitutes a specific vehicle, see TSD Chapter 2.4.7 for more
detail.

---------------------------------------------------------------------------

[GRAPHIC] [TIFF OMITTED] TP03SE21.077

(e) Aerodynamics Costs
    This analysis uses the AERO technology costs established in the
2020 final rule that are based on confidential business information
submitted by the automotive industry in advance of the 2018 NPRM,\251\
and on DOT's assessment of manufacturing costs for specific aerodynamic
technologies.\252\ DOT received no additional comments from
stakeholders regarding the costs established in the 2018 NPRM, and
continued to use the established costs for the 2020 final rule and this
analysis.
---------------------------------------------------------------------------

    \250\ The data used to create this figure can be found in the
FE_1 Improvements file.
    \251\ See the PRIA accompanying the 2018 NPRM, Chapter
<IP_ADDRESS>.2.1.2 for a discussion of these cost estimates.
    \252\ See the FRIA accompanying the 2020 final rule, Chapter
VI.C.5.e.
---------------------------------------------------------------------------

    Table III-30 shows examples of costs for AERO technologies as
applied to the medium car and pickup truck vehicle classes in select
model years. The cost to achieve AERO5 is relatively low, as most of
the improvements can be made through body styling changes. The cost to
achieve AERO10 is higher than AERO5, due to the addition of several
passive aerodynamic technologies, and the cost to achieve AERO15 and
AERO20 is higher than AERO10 due to use of both passive and active
aerodynamic technologies. For a full list of all absolute aerodynamic
technology costs used in the analysis across all model years see the
Technologies file.

[GRAPHIC] [TIFF OMITTED] TP03SE21.078

6. Tire Rolling Resistance
    Tire rolling resistance is a road load force that arises primarily
from the energy dissipated by elastic deformation of the tires as they
roll. Tire design characteristics (for example, materials,
construction, and tread design) have a strong influence on the amount
and type of deformation and the energy it dissipates. Designers can
select these characteristics to minimize rolling resistance. However,
these characteristics may also influence other performance attributes,
such as durability, wet and dry traction, handling, and ride comfort.
    Lower-rolling-resistance tires have characteristics that reduce
frictional losses associated with the energy dissipated mainly in the
deformation of the tires under load, thereby improving fuel economy.
Low rolling resistance tires are increasingly specified by OEMs in new
vehicles and are also increasingly available from aftermarket tire
vendors. They commonly include attributes such as higher inflation
pressure, material changes, tire construction optimized for lower
hysteresis, geometry changes (e.g., reduced aspect ratios), and reduced
sidewall and tread deflection. These changes are commonly accompanied
by additional changes to vehicle suspension tuning and/or suspension
design to mitigate any potential impact on other performance attributes
of the vehicle.
    DOT continues to assess the potential impact of tire rolling
resistance changes on vehicle safety. DOT has been following the
industry developments and trends in application of rolling resistance
technologies to light duty vehicles. As stated in the National
Academies Press (NAP) special report on Tires and Passenger Vehicle
Fuel Economy,\253\ national crash data does not provide data about tire
structural failures specifically related to tire rolling resistance,
because the rolling resistance of a tire at a crash scene cannot be
determined. However, other metrics like brake performance compliance
test data are helpful to show trends like that stopping distance has
not changed in the last ten years,\254\ during which time many
manufacturers have installed low rolling resistance tires in their
fleet--meaning that manufacturers were successful in improving rolling
resistance while maintaining stopping distances through tire design,
tire materials, and/or braking system improvements. In addition, NHTSA
has addressed other tire-related issues through rulemaking,\255\ and
continues to research tire problems such as blowouts, flat tires, tire
or wheel deficiency, tire or wheel failure, and tire degradation.\256\
However, there are currently no data connecting low rolling resistance
tires to accident or fatality rates.
---------------------------------------------------------------------------

    \253\ Tires and Passenger Vehicle Fuel Economy: Informing
Consumers, Improving Performance--Special Report 286 (2006),
available at https://www.nap.edu/read/11620/chapter/6.
    \254\ See, e.g., NHTSA Office of Vehicle Safety Compliance,
Compliance Database, https://one.nhtsa.gov/cars/problems/comply/index.cfm.
    \255\ 49 CFR 571.138, Tire pressure monitoring systems.
    \256\ Tire-Related Factors in the Pre-Crash Phase, DOT HS 811
617 (April 2012), available at https://crashstats.nhtsa.dot.gov/Api/Public/ViewPublication/811617.

---------------------------------------------------------------------------

    NHTSA conducted tire rolling resistance tests and wet grip index
tests on original equipment tires installed on new vehicles. The tests
showed that there is no degradation in wet grip index values (no
degradation in traction) for tires with improved rolling resistance
technology. With better tire design, tire compound formulations and
improved tread design, tire manufacturers have tools to balance
stopping distance and reduced rolling resistance. Tire manufacturers
can use ``higher performance materials in the tread compound, more
silica as reinforcing fillers and advanced tread design features'' to
mitigate issues related to stopping distance.\257\
---------------------------------------------------------------------------

    \257\ Jesse Snyder, A big fuel saver: Easy-rolling tires (but
watch braking) (July 21, 2008), https://www.autonews.com/article/20080721/OEM01/307219960/a-big-fuel-saver-easy-rolling-tires-but-watch-braking. Last visited December 3, 2019.
---------------------------------------------------------------------------

    The following sections discuss levels of tire rolling resistance
technology considered in the CAFE Model, how the technology was
assigned in the analysis fleet, adoption features specified to maintain
performance, effectiveness, and cost.
(a) Tire Rolling Resistance in the CAFE Model
    DOT continues to consider two levels of improvement for low rolling
resistance tires in the analysis: The first level of low rolling
resistance tires considered reduced rolling resistance 10 percent from
an industry-average baseline rolling resistance coefficient (RRC)
value, while the second level reduced rolling resistance 20 percent
from the baseline.\258\
---------------------------------------------------------------------------

    \258\ To achieve ROLL10, the tire rolling resistance must be at
least 10 percent better than baseline (.0081 or better). To achieve
ROLL20, the tire rolling resistance must be at least 20 percent
better than baseline (.0072 or better).
---------------------------------------------------------------------------

    DOT selected the industry-average RRC baseline of 0.009 based on a
CONTROLTEC study prepared for the California Air Resources Board,\259\
in addition to confidential business information submitted by
manufacturers prior to the 2018 NPRM analysis. The average RRC from the
CONTROLTEC study, which surveyed 1,358 vehicle models, was 0.009.\260\
CONTROLTEC also compared the findings of their survey with values
provided by Rubber Manufacturers Association (renamed as USTMA-U.S.
Tire Manufacturers Association) for original equipment tires. The
average RRC from the data provided by RMA was 0.0092,\261\ compared to
average of 0.009 from CONTROLTEC.
---------------------------------------------------------------------------

    \259\ Technical Analysis of Vehicle Load Reduction by CONTROLTEC
for California Air Resources Board (April 29, 2015).
    \260\ The RRC values used in this study were a combination of
manufacturer information, estimates from coast down tests for some
vehicles, and application of tire RRC values across other vehicles
on the same platform.
    \261\ Technical Analysis of Vehicle Load Reduction by CONTROLTEC
for California Air Resources Board (April 29, 2015) at page 40.
---------------------------------------------------------------------------

    In past agency actions, commenters have argued that based on
available data on current vehicle models and the likely possibility
that there would be additional tire improvements over the next decade,
DOT should consider ROLL30 technology, or a 30 percent reduction of
tire rolling resistance over the baseline.\262\
---------------------------------------------------------------------------

    \262\ NHTSA-2018-0067-11985.
---------------------------------------------------------------------------

    As stated in the Joint TSD for the MY 2017-2025 final rule (77 FR
62624, Oct. 15, 2012) and 2020 final rule, tire technologies that
enable rolling resistance improvements of 10 and 20 percent have been
in existence for many years.\263\ Achieving improvements of up to 20
percent involves optimizing and integrating multiple technologies, with
a primary contributor being the adoption of a silica tread technology.
Tire suppliers have indicated that additional innovations are necessary
to achieve the next level of low rolling resistance technology on a
commercial basis, such as improvements in material to retain tire
pressure, tread design to manage both stopping distance and wet
traction, and development of carbon black material for low rolling
resistance without the use of silica to reduce cost and weight.\264\
---------------------------------------------------------------------------

    \263\ EPA-420-R-12-901, at page 3-210.
    \264\ 2011 NAS report, at 103.
---------------------------------------------------------------------------

    The agency believes that the tire industry is in the process of
moving automotive manufacturers towards higher levels of rolling
resistance technology in the vehicle fleet. Importantly, as shown
below, the MY 2020 fleet does include a higher percentage of vehicles
with ROLL20 technology than the MY 2017 fleet. However, DOT believes
that at this time, the emerging tire technologies that would achieve 30
percent improvement in rolling resistance, like changing tire profile,
stiffening tire walls, or adopting improved tires along with active
chassis control,\265\ among other technologies, will not be available
for widespread commercial adoption in the fleet during the rulemaking
timeframe. As a result, the agency continues to not to incorporate 30
percent reduction in rolling resistance technology. DOT will consider
adding an advanced level of tire rolling resistance technology to
future analyses, and invites comment on any updated information on
manufacturers' capabilities to add tires with higher levels of rolling
resistance to their vehicles, and consumers' willingness to accept
these tires on their vehicles.
---------------------------------------------------------------------------

    \265\ Mohammad Mehdi Davari, Rolling resistance and energy loss
in tyres (May 20, 2015), available at https://www.sveafordon.com/media/42060/SVEA-Presentation_Davari_public.pdf. Last visited
December 30, 2019.
---------------------------------------------------------------------------

(b) Tire Rolling Resistance Analysis Fleet Assignments
    Tire rolling resistance is not a part of tire manufacturers'
publicly released specifications and thus it is difficult to assign
this technology to the analysis fleet. Manufacturers also often offer
multiple wheel and tire packages for the same nameplates, further
increasing the complexity of this assignment. DOT employed an approach
consistent with previous rulemaking in assigning this technology. DOT
relied on previously submitted rolling resistance values that were
supplied by manufacturers in the process of building older fleets and
bolstered it with agency-sponsored tire rolling testing by
Smithers.\266\
---------------------------------------------------------------------------

    \266\ See memo to Docket No. NHTSA-2021-0053, Evaluation of
Rolling Resistance and Wet Grip Performance of OEM Stock Tires
Obtained from NCAP Crash Tested Vehicles Phase One and Two. NHTSA
used tire rolling resistance coefficient values from this project to
assign baseline tire rolling resistance technology in the MY 2020
analysis fleet and is therefore providing the draft project
appendices for public review and comment.
---------------------------------------------------------------------------

    DOT carried over rolling resistance assignments for nameplates
where manufacturers had submitted data on the vehicles' rolling
resistance values, even if the vehicle was redesigned. If Smithers data
was available, DOT replaced any older or missing values with that
updated data. Those vehicles for which no information was available
from either previous manufacturer submission or Smithers data were
assigned to ROLL0. All vehicles under the same nameplate were assigned
the same rolling resistance technology level even if manufacturers do
outfit different trim levels with different wheels and tires.
    The MY 2020 analysis fleet includes the following breakdown of
rolling resistance technology: 44% at ROLL0, 20% at ROLL10, and 36% at
ROLL20, which shows that the majority of the fleet has now adopted some
form of improved rolling resistance technology. The majority of the
change from the MY 2017 analysis fleet has been in implementing ROLL20
technology. There is likely more proliferation of rolling resistance
technology, but we would need further information from manufacturers in
order to account for it. DOT invites comment from manufacturers on
whether these rolling

resistance values are still applicable, or any updated rolling
resistance values that could be incorporated in a publicly available
analysis fleet. If manufacturers submit updated information on baseline
rolling resistance assignments DOT may update those assignments for the
final rule.
(c) Tire Rolling Resistance Adoption Features
    Rolling resistance technology can be adopted with either a vehicle
refresh or redesign. In some cases, low rolling resistance tires can
affect traction, which may adversely impact acceleration, braking, and
handling characteristics for some high-performance vehicles. Similar to
past rulemakings, the agency recognizes that to maintain performance,
braking, and handling functionality, some high-performance vehicles
would not adopt low rolling resistance tire technology. For cars and
SUVs with more than 405 horsepower (hp), the agency restricted the
application of ROLL20. For cars and SUVs with more than 500 hp, the
agency restricted the application of any additional rolling resistance
technology (ROLL10 or ROLL20). The agency developed these cutoffs based
on a review of confidential business information and the distribution
of rolling resistance values in the fleet.
(d) Tire Rolling Resistance Effectiveness Modeling
    As discussed above, the baseline rolling resistance value from
which rolling resistance improvements are measured is 0.009, based on a
thorough review of confidential business information submitted by
industry, and a review of other literature. To achieve ROLL10, the tire
rolling resistance must be at least 10 percent better than baseline
(.0081 or better). To achieve ROLL20, the tire rolling resistance must
be at least 20 percent better than baseline (.0072 or better).
    DOT determined effectiveness values for rolling resistance
technology adoption using Autonomie modeling. Figure III-16 below shows
the range of effectiveness values used for adding tire rolling
resistance technology to a vehicle in this analysis. The graph shows
the change in fuel consumption values between entire technology
keys,\267\ and not the individual technology effectiveness values.
Using the change between whole technology keys captures the
complementary or non-complementary interactions among technologies. In
the graph, the box shows the interquartile range (IQR) of the
effectiveness values and whiskers extend out 1.5 x IQR. The dots
outside of the whiskers show values for effectiveness that are outside
these bounds.
---------------------------------------------------------------------------

    \267\ Technology key is the unique collection of technologies
that constitutes a specific vehicle, see TSD Chapter 2.4.7 for more
information.
---------------------------------------------------------------------------

    The data points with the highest effectiveness values are almost
all exclusively BEV and FCV technology combinations for medium sized
nonperformance cars. The effectiveness for these vehicles, when the low
rolling resistance technology is applied, is amplified by a
complementary effect, where the lower rolling resistance reduces road
load and allows a smaller battery pack to be used (and still meet range
requirements). The smaller battery pack reduces the overall weight of
the vehicle, further reducing road load, and improving fuel efficiency.
This complimentary effect is experience by all the vehicle technology
classes, but the strongest effect is on the midsized vehicle non-
performance classes and is only captured in the analysis through the
use of full vehicle simulations, demonstrating the full interactions of
the technologies.

[GRAPHIC] [TIFF OMITTED] TP03SE21.079

(e) Tire Rolling Resistance Costs
    DOT continues to use the same DMC values for ROLL technology that
were used for the 2020 final rule which are based on NHTSA's MY 2011
CAFE final rule (74 FR 14196, March 30, 2009) and the 2006 NAS/NRC
report.\268\ Table III-31 shows the different levels of tire rolling
resistance technology cost for all vehicle classes across select model
years, which shows how the learning rate for ROLL technologies impacts
the cost. For all ROLL absolute technology costs used in the analysis
across all model years see the Technologies file.
---------------------------------------------------------------------------

    \268\ ``Tires and Passenger Vehicle Fuel Economy,''
Transportation Research Board Special Report 286, National Research
Council of the National Academies, 2006, Docket No. EPA-HQ-OAR-2009-
0472-0146.
[GRAPHIC] [TIFF OMITTED] TP03SE21.080

7. Other Vehicle Technologies
    Four other vehicle technologies were included in the analysis--
electric power steering (EPS), improved accessory devices (IACC), low
drag brakes (LDB), and secondary axle disconnect (SAX). The
effectiveness of these technologies was applied directly in the CAFE
Model with unique effectiveness values for each technology and for each
technology class, rather than using Autonomie effectiveness estimates.
This methodology was used in these four cases because the effectiveness
of these technologies varies little with combinations of other
technologies. Also, applying these technologies directly in the CAFE
Model significantly reduces the number of Autonomie simulations that
are needed.
(a) Electric Power Steering
    Electric power steering reduces fuel consumption by reducing load
on the engine. Specifically, it reduces or eliminates the parasitic
losses associated with engine-driven power

steering pumps, which pump hydraulic fluid continuously through the
steering actuation system even when no steering input is present. By
selectively powering the electric assist only when steering input is
applied, the power consumption of the system is reduced in comparison
to the traditional ``always-on'' hydraulic steering system. Power
steering may be electrified on light duty vehicles with standard 12V
electrical systems and is also an enabler for vehicle electrification
because it provides power steering when the engine is off (or when no
combustion engine is present).
    Power steering systems can be electrified in two ways.
Manufacturers may choose to eliminate the hydraulic portion of the
steering system and provide electric-only power steering (EPS) driven
by an independent electric motor, or they may choose to move the
hydraulic pump from a belt-driven configuration to a stand-alone
electrically driven hydraulic pump. The latter system is commonly
referred to as electro-hydraulic power steering (EHPS). As discussed in
the rulemakings, manufacturers have informed DOT that full EPS systems
are being developed for all types of light-duty vehicles, including
large trucks.
    DOT described in past rulemakings that, like low drag brakes, EPS
can be difficult to observe and assign to the analysis fleet, however,
it is found more frequently in publicly available information than low
drag brakes. Based on comments received during the 2020 rulemaking, the
agency increased EPS application rate to nearly 90 percent for the 2020
final rule. The agency is maintaining this level of EPS fleet
penetration for this analysis, recognizing that some specialized,
unique vehicle types or configurations still implement hydraulically
actuated power steering systems for the baseline fleet model year.
    The effectiveness of both EPS and EHPS is derived from the
decoupling of the pump from the crankshaft and is considered to be
practically the same for both. Thus, a single effectiveness value is
used for both EPS and EHPS. As indicated in the following table, the
effectiveness of EPS and EHPS varies based on the vehicle technology
class it is being applied to. This variance is a direct result of
vehicle size and the amount of energy required to turn the vehicle's
two front wheels about their vertical axis. More simply put, more
energy is required for vehicles that weigh more and, typically, have
larger tire contact patches.
[GRAPHIC] [TIFF OMITTED] TP03SE21.081

(b) Improved Accessories
    Engine accessories typically include the alternator, coolant pump,
cooling fan, and oil pump, and are traditionally mechanically driven
via belts, gears, or directly by other rotating engine components such
as camshafts or the crankshaft. These can be replaced with improved
accessories (IACC), which may include high efficiency alternators,
electrically driven (i.e., on-demand) coolant pumps, electric cooling
fans, variable geometry oil pumps, and a mild regeneration strategy.
Replacing lower-efficiency and/or mechanically-driven components with
these improved accessories results in a reduction in fuel consumption,
as the improved accessories can conserve energy by being turned on/off
``on demand'' in some cases, driven at partial load as needed, or by
operating more efficiently.
    For example, electric coolant pumps and electric powertrain cooling
fans provide better control of engine cooling. Flow from an electric
coolant pump can be varied, and the cooling fan can be shut off during
engine warm-up or cold ambient temperature conditions, reducing warm-up
time, fuel enrichment requirements, and, ultimately reducing parasitic
losses.
    IACC technology is difficult to observe and therefore there is
uncertainty in assigning it to the analysis fleet. As in the past, DOT
relies on industry-provided information and comments to assess the
level of IACC technology applied in the fleet. DOT believes there
continues to be opportunity for further implementation of IACC. The MY
2020 analysis fleet has an IACC fleet penetration of approximately
eight percent compared to the six percent value in the MY 2017 analysis
fleet used for the 2020 final rule analysis.
    The agency believes improved accessories may be incorporated in
coordination with powertrain related changes occurring at either a
vehicle refresh or vehicle redesign. This coordination with powertrain
changes enables related design and tooling changes to be implemented
and systems development, functionality and durability testing to be
conducted in a single product change program to efficiently manage
resources and costs.
    This analysis carries forward work on the effectiveness of IACC
systems conducted in the Draft TAR and EPA Proposed Determination that
is originally founded in the 2002 NAS Report \269\ and confidential
manufacturer data. This work involved gathering information by
monitoring

press reports, holding meetings with suppliers and OEMs, and attending
industry technical conferences. The resulting effectiveness estimates
we use are shown below. As indicated in the following table, the
effectiveness of IACC is simulated with differing values based on the
vehicle technology class it is being applied to. This variance, like
EPS, is a direct result of vehicle size and the amount of energy
required perform the work necessary for the vehicle to operate as
expected. This variance is related to the amount energy generated by
the alternator, the size of the coolant pump to the cool the necessary
systems, the size of the cooling fan required, among other
characteristics and it directed related to a vehicle size and mass.
---------------------------------------------------------------------------

    \269\ National Research Council 2002. Effectiveness and Impact
of Corporate Average Fuel Economy (CAFE) Standards. Washington, DC:
The National Academies Press. https://doi.org/10.17226/10172.
[GRAPHIC] [TIFF OMITTED] TP03SE21.082

(c) Low Drag Brakes
    Since 2009, for the MY 2011 CAFE final rule, DOT has defined low
drag brakes (LDB) as brakes that reduce the sliding friction of disc
brake pads on rotors when the brakes are not engaged because the brake
pads are pulled away from the rotating disc either by mechanical or
electric methods.\270\ DOT estimated the effectiveness of LDB
technology to be a range from 0.5-1.0 percent, based on CBI data. DOT
applied a learning curve to the estimated cost for LDB, but noted that
the technology was considered high volume, mature, and stable. DOT
explained that confidential manufacturer comments in response to the
NPRM for MY 2011 (73 FR 24352, May 2, 2008) indicated that most
passenger cars have already adopted LDB technology, but ladder frame
trucks have not.
---------------------------------------------------------------------------

    \270\ Final Regulatory Impact Analysis, Corporate Average Fuel
Economy for MY 2011 Passenger Cars and Light Trucks (March 2009), at
V-135.
---------------------------------------------------------------------------

    DOT and EPA continued to use the same definition for LDB in the MY
2012-2016 rule (75 FR 25324, May 7, 2010), with an estimated
effectiveness of up to 1 percent based on CBI data.\271\ DOT only
allowed LDB technology to be applied to large car, minivan, medium and
large truck, and SUV classes because the agency determined the
technology was already largely utilized in most other subclasses. The
2011 NAS committee also utilized NHTSA and EPA's definition for LDB and
added that most new vehicles have low-drag brakes.\272\ The committee
confirmed that the impact over conventional brakes may be about a 1
percent reduction of fuel consumption.
---------------------------------------------------------------------------

    \271\ Final Regulatory Impact Analysis, Corporate Average Fuel
Economy for MY 2012-MY 2016 Passenger Cars and Light Trucks (March
2010), at 249.
    \272\ 2011 NAS report, at 104.
---------------------------------------------------------------------------

    For the MY 2017-2025 rule, however, DOT and EPA updated the
effectiveness estimate for LDB to 0.8 percent based on a 2011 Ricardo
study and updated lumped-parameter model.\273\ The agencies considered
LDB technology to be off the learning curve (i.e., the DMC does not
change year-over-year). The 2015 NAS report continued to use the
agencies' definition for LDB and commented that the 0.8 percent
effectiveness estimate is a reasonable estimate.\274\ The 2015 NAS
committee did not opine on the application of LDB technology in the
fleet. The agencies used the same definition, cost, and effectiveness
estimates for LDB in the Draft TAR, but also noted the existence of
zero drag brake systems which use electrical actuators that allow brake
pads to move farther away from the rotor.\275\ However, the agencies
did not include zero drag brake technology in either compliance
simulation. EPA continued with this approach in its first 2017 Final
Determination that the standards through 2025 were appropriate.\276\
---------------------------------------------------------------------------

    \273\ Joint Technical Support Document: Final Rulemaking for
2017-2025 Light-Duty Vehicle Greenhouse Gas Emission Standards and
Corporate Average Fuel Economy Standards (August 2012), at 3-211.
    \274\ 2015 NAS report, at 231.
    \275\ Draft TAR, at 5-207.
    \276\ EPA Proposed Determination TSD, at 2-422.
---------------------------------------------------------------------------

    In the 2020 final rule, the agencies applied LDB sparingly in the
MY 2017 analysis fleet using the same cost and effectiveness estimates
from the 2011 Ricardo study, with approximately less than 15% of
vehicles being assigned the technology. In addition, DOT noted the
existence of zero drag brakes in production for some BEVs, similar to
the summary in the Draft TAR, but did not opine on the existence of
zero drag brakes in the fleet. Some stakeholders commented to the 2020
final rule that other vehicle technologies, including LDB, were
actually overapplied in the analysis fleet.
    For this action, DOT considered the conflicting statements that LDB
were both universally applied in new vehicles and that the new vehicle
fleet still had space to improve LDB technology. DOT determined that
LDB technology as previously defined going back to the MY 2011 rule (74
FR 14196, March 30, 2009) was universally

applied in the MY 2020 fleet. However, DOT determined that zero drag
brakes, the next level of brake technology, was sparingly applied in
the MY 2020 analysis fleet. Currently, DOT does not believe that zero
drag brake systems will be available for wide scale application in the
rulemaking timeframe and did not include it as a technology for this
analysis. DOT will consider how to define a new level of low drag brake
technology that either encompasses the definition of zero drag brakes
or similar technology in future rulemakings. We invite comment on the
issue, and any available data regarding use of such systems on current
and forthcoming production vehicles, any available data regarding
system costs and efficacy in reducing drag (i.e., force at different
speeds) and vehicle fuel economy levels (i.e., through coastdown
testing).
(d) Secondary Axle Disconnect
    All-wheel drive (AWD) and four-wheel drive (4WD) vehicles provide
improved traction by delivering torque to the front and rear axles,
rather than just one axle. When a second axle is rotating, it tends to
consume more energy because of additional losses related to lubricant
churning, seal friction, bearing friction, and gear train
inefficiencies.\277\ Some of these losses may be reduced by providing a
secondary axle disconnect function that disconnects one of the axles
when driving conditions do not call for torque to be delivered to both.
---------------------------------------------------------------------------

    \277\ Pilot Systems, ``AWD Component Analysis'', Project Report,
performed for Transport Canada, Contract T8080-
    150132, May 31, 2016.
---------------------------------------------------------------------------

    The terms AWD and 4WD are often used interchangeably, although they
have also developed a colloquial distinction, and are two separate
systems. The term AWD has come to be associated with light-duty
passenger vehicles providing variable operation of one or both axles on
ordinary roads. The term 4WD is often associated with larger truck-
based vehicle platforms providing a locked driveline configuration and/
or a low range gearing meant primarily for off-road use.
    Many 4WD vehicles provide for a single-axle (or two-wheel) drive
mode that may be manually selected by the user. In this mode, a primary
axle (usually the rear axle) will be powered, while the other axle
(known as the secondary axle) is not. However, even though the
secondary axle and associated driveline components are not receiving
engine power, they are still connected to the non-driven wheels and
will rotate when the vehicle is in motion. This unnecessary rotation
consumes energy,\278\ and leads to increased fuel consumption that
could be avoided if the secondary axle components were completely
disconnected and not rotating.
---------------------------------------------------------------------------

    \278\ Any time a drivetrain component spins it consumes some
energy, primarily to overcome frictional forces.
---------------------------------------------------------------------------

    Light-duty AWD systems are often designed to divide variably torque
between the front and rear axles in normal driving to optimize traction
and handling in response to driving conditions. However, even when the
secondary axle is not necessary for enhanced traction or handling, in
traditional AWD systems it typically remains engaged with the driveline
and continues to generate losses that could be avoided if the axle was
instead disconnected. The SAX technology observed in the marketplace
disengages one axle (typically the rear axle) for two-wheel drive (2WD)
operation but detects changes in driving conditions and automatically
engages AWD mode when it is necessary. The operation in 2WD can result
in reduced fuel consumption. For example, Chrysler has estimated the
secondary axle disconnect feature in the Jeep Cherokee reduces friction
and drag attributable to the secondary axle by 80% when in disconnect
mode.\279\
---------------------------------------------------------------------------

    \279\ Brooke, L. ``Systems Engineering a new 4x4 benchmark'',
SAE Automotive Engineering, June 2, 2014.
---------------------------------------------------------------------------

    Observing SAX technology on actual vehicles is very difficult.
Manufacturers do not typically identify the technology on technical
specifications or other widely available information. The agency
employed an approach consistent with previous rulemaking in assigning
this technology. Specifically, the agency assigned SAX technology based
on a combination of publicly available information and previously
submitted confidential information. In the analysis fleet, 38% of the
vehicles that had AWD or 4WD are determined to have SAX technology. All
vehicles in the analysis fleet with front-wheel drive (FWD) or rear-
wheel drive (RWD) have SAX skipped since SAX technology is a way to
emulate FWD or RWD in AWD and 4WD vehicles, respectively. The agency
does not allow for the application of SAX technology to FWD or RWD
vehicles because they do not have a secondary driven axle to
disconnect.
    SAX technology can be adopted by any vehicle in the analysis fleet,
including those with a HEV or BEV powertrain,\280\ which was identified
as having AWD or 4WD. It does not supersede any technology or result in
any other technology being excluded for future implementation for that
vehicle. SAX technology can be applied during any refresh or redesign.
DOT seeks comment on whether it is appropriate for SAX technology to be
allowed to be applied to BEVs, or if the technology only provides
benefits to ICE vehicles.
---------------------------------------------------------------------------

    \280\ The inefficiencies addressed on ICEs by SAX technology may
not be similar enough, or even present, in HEVs or BEVs.
---------------------------------------------------------------------------

    This analysis carries forward work on the effectiveness of SAX
systems conducted in the Draft TAR and EPA Proposed Determination.\281\
This work involved gathering information by monitoring press reports,
holding meetings with suppliers and OEMs, and attending industry
technical conferences. DOT does not simulate SAX effectiveness in the
Autonomie modeling because, similar to LDB, IACC, and EFR, the fuel
economy benefits from the technology are not fully captured on the two-
cycle test. The secondary axle disconnect effectiveness values, for the
most part, have been accepted as plausible based on the rulemaking
record and absence of contrary comments. As such, the agency has
prioritized its extensive Autonomie vehicle simulation work toward
other technologies that are emerging or considered more critical for
total system effectiveness. The resulting effectiveness estimates we
use are shown below. The agency welcomes comment on these effectiveness
values and will consider any material data providing revised, or
confirmatory, values for those being used in the analysis.
---------------------------------------------------------------------------

    \281\ Draft TAR, at 5-412; Proposed Determination TSD, at 2-422.

---------------------------------------------------------------------------

[GRAPHIC] [TIFF OMITTED] TP03SE21.083

(e) Other Vehicle Technology Costs
    The cost estimates for EPS, IACC, SAX, and LDB \282\ rely on
previous work published as part of past rulemakings with learning
applied to those cost values which is founded in the 2002 NAS
report.\283\ The cost values are the same values that were used for the
Draft TAR and 2020 final rule, updated to 2018 dollars. Table III-35
shows examples of costs for these technologies across select model
years. Note that these costs are the same for all vehicle technology
classes. For all absolute EPS, IACC, LDB, and SAX technology costs
across all model years, see the Technologies file.
---------------------------------------------------------------------------

    \282\ Note that because LDB technology is applied universally as
a baseline technology in the MY 2020 fleet, there is functionally
zero costs for this technology associated with this proposed
rulemaking.
    \283\ National Research Council 2002. Effectiveness and Impact
of Corporate Average Fuel Economy (CAFE) Standards. Washington, DC:
The National Academies Press. https://doi.org/10.17226/10172.
[GRAPHIC] [TIFF OMITTED] TP03SE21.084

8. Simulating Air Conditioning Efficiency and Off-Cycle Technologies
    Off-cycle and air conditioning (A/C) efficiency technologies can
provide fuel economy benefits in real-world vehicle operation, but
those benefits cannot be fully captured by the traditional 2-cycle test
procedures used to measure fuel economy.\284\ Off-cycle technologies
include technologies like high efficiency alternators and high
efficiency exterior lighting.\285\ A/C efficiency technologies are
technologies that reduce the operation of or the loads on the
compressor, which pressurizes A/C refrigerant. The less the compressor
operates or the more efficiently it operates, the less load the
compressor places on the engine, resulting in better fuel efficiency.
---------------------------------------------------------------------------

    \284\ See 49 U.S.C 32904(c) (``The Administrator shall measure
fuel economy for each model and calculate average fuel economy for a
manufacturer under testing and calculation procedures prescribed by
the Administrator. . . . the Administrator shall use the same
procedures for passenger automobiles the Administrator used for
model year 1975 (weighted 55 percent urban cycle and 45 percent
highway cycle), or procedures that give comparable results.'').
    \285\ 40 CFR 86.1869-12(b)--Credit available for certain off-
cycle technologies.
---------------------------------------------------------------------------

    Vehicle manufacturers have the option to generate credits for off-
cycle technologies and improved A/C systems under the EPA's
CO2 program and receive a fuel consumption improvement value
(FCIV) equal to the value of the benefit not captured on the 2-cycle
test under NHTSA's CAFE program. The FCIV is not a ``credit'' in the
NHTSA CAFE program,\286\ but the FCIVs increase the reported fuel
economy of a manufacturer's fleet, which is used to determine
compliance. EPA applies FCIVs during determination of a fleet's final
average fuel economy reported to NHTSA.\287\

FCIVs are only calculated and applied at a fleet level for a
manufacturer and are based on the volume of the manufacturer's fleet
that contain qualifying technologies.\288\
---------------------------------------------------------------------------

    \286\ Unlike, for example, the statutory overcompliance credits
prescribed in 49 U.S.C. 32903.
    \287\ 49 U.S.C. 32904(c)-(e). EPCA granted EPA authority to
establish fuel economy testing and calculation procedures. See
Section VII for more information.
    \288\ 40 CFR 600.510-12(c).
---------------------------------------------------------------------------

    There are three pathways that can be used to determine the value of
A/C efficiency and off-cycle adjustments. First, manufacturers can use
a predetermined list or ``menu'' of g/mi values that EPA established
for specific off-cycle technologies.\289\ Second, manufacturers can use
5-cycle testing to demonstrate off-cycle CO2 benefit; \290\
the additional tests allow emissions benefits to be demonstrated over
some elements of real-world driving not captured by the 2-cycle
compliance tests, including high speeds, rapid accelerations, hot
temperatures, and cold temperatures. Third, manufacturers can seek EPA
approval, through a notice and comment process, to use an alternative
methodology other than the menu or 5-cycle methodology for determining
the off-cycle technology improvement values.\291\ For further
discussion of the A/C and off-cycle compliance and application process,
see Section VII.
---------------------------------------------------------------------------

    \289\ See 40 CFR 86.1869-12(b). The TSD for the 2012 final rule
for MYs 2017 and beyond provides technology examples and guidance
with respect to the potential pathways to achieve the desired
physical impact of a specific off-cycle technology from the menu and
provides the foundation for the analysis justifying the credits
provided by the menu. The expectation is that manufacturers will use
the information in the TSD to design and implement off-cycle
technologies that meet or exceed those expectations in order to
achieve the real-world benefits of off-cycle technologies from the
menu.
    \290\ See 40 CFR 86.1869-12(c). EPA proposed a correction for
the 5-cycle pathway in a separate technical amendments rulemaking.
See 83 FR 49344 (Oct. 1, 2019). EPA is not approving credits based
on the 5-cycle pathway pending the finalization of the technical
amendments rule.
    \291\ See 40 CFR 86.1869-12(d).
---------------------------------------------------------------------------

    DOT and EPA have been collecting data on the application of these
technologies since implementing the A/C and off-cycle
programs.292 293 Most manufacturers are applying A/C
efficiency and off-cycle technologies; in MY 2019, 17 manufacturers
employed A/C efficiency technologies and 20 manufacturers employed off-
cycle technologies, though the level of deployment varies by
manufacturer.\294\
---------------------------------------------------------------------------

    \292\ See 77 FR at 62832, 62839 (Oct. 15, 2012). EPA introduced
A/C and off-cycle technology credits for the CO2 program
in the MY 2012-2016 rule and revised the program in the MY 2017-2025
rule and NHTSA adopted equivalent provisions for MYs 2017 and later
in the MY 2017-2025 rule.
    \293\ Vehicle and Engine Certification. Compliance Information
for Light-Duty Gas (GHG) Standards. Compliance Information for
Light-Duty Greenhouse Gas (GHG) Standards [verbar] Certification and
Compliance for Vehicles and Engines [verbar] U.S. EPA. Last Accessed
May 24, 2021.
    \294\ See 2020 EPA Automotive Trends Report, at 91.
---------------------------------------------------------------------------

    Manufacturers have only recently begun including detailed
information on off-cycle and A/C efficiency technologies equipped on
vehicles in compliance reporting data. For this analysis, though, such
information was not sufficiently complete to support a detailed
representation of the application of off-cycle technology to specific
vehicle model/configurations in the MY 2020 fleet. To account for the
A/C and off-cycle technologies equipped on vehicles and the potential
that manufacturers will apply additional A/C and off-cycle technologies
in the rulemaking timeframe, DOT specified model inputs for A/C
efficiency and off-cycle fuel consumption improvement values in grams/
mile for each manufacturer's fleet in each model year. DOT estimated
future values based on an expectation that manufacturers already
relying heavily on these adjustments would continue do so, and that
other manufacturers would, over time, also approach the limits on
adjustments allowed for such improvements.
    The next sections discuss how the CAFE Model simulates the
effectiveness and cost for A/C efficiency and off-cycle technology
adjustments.
(a) A/C and Off-Cycle Effectiveness Modeling in the CAFE Model
    In this analysis, the CAFE Model applies A/C and off-cycle
flexibilities to manufacturer's CAFE regulatory fleet performance in a
similar way to the regulation.\295\ In the analysis and after the first
MY, A/C efficiency and off-cycle FCIVs apply to each manufacturer's
regulatory fleet after the CAFE Model applies conventional technologies
for a given standard. That is, conventional technologies are applied to
each manufacturers' vehicles in each MY to assess the 2-cycle sales
weighted harmonic average CAFE rating. Then, the CAFE Model assesses
the CAFE rating to use for a manufacturer's compliance value after
applying the A/C efficiency and off-cycle FCIVs designated in the
Market Data file. This assessment of adoption of conventional
technology and the A/C efficiency and off-cycle technology occurs on a
year-by-year basis in the CAFE Model. The CAFE Model attempts to apply
technologies and flexibilities in a way that both minimizes cost and
allows the manufacturer to meet their standards without over or under
complying.
---------------------------------------------------------------------------

    \295\ 49 CFR 531.6 and 49 CFR 533.6 Measurement and Calculation
procedures.
---------------------------------------------------------------------------

    To determine how manufacturers might adopt A/C efficiency and off-
cycle technologies in the rulemaking timeframe, DOT began with data
from EPA's 2020 Trends Report and CBI compliance material from
manufacturers.296 297 DOT used manufacturer's MY 2020 A/C
efficiency and off-cycle FCIVs as a starting point, and then
extrapolated values in each MY until MY 2026, for light trucks to the
proposed regulatory cap, for each manufacturer's fleets by regulatory
class.
---------------------------------------------------------------------------

    \296\ Vehicle and Engine Certification. Compliance Information
for Light-Duty Gas (GHG) Standards. Compliance Information for
Light-Duty Greenhouse Gas (GHG) Standards [verbar] Certification and
Compliance for Vehicles and Engines [verbar] U.S. EPA. Last Accessed
May 24, 2021.
    \297\ 49 U.S.C. 32907.
---------------------------------------------------------------------------

    To determine the rate at which to extrapolate the addition of A/C
and off-cycle technology adoption for each manufacturer, DOT reviewed
historical A/C and off-cycle technology applications, each
manufacturer's fleet composition (i.e., breakdown between passenger
cars (PCs) and light trucks (LTs)), availability of A/C and off-cycle
technologies that manufacturers could still use, and CBI compliance
data. Different manufacturers showed different levels of historical A/C
efficiency and off-cycle technology adoption; therefore, different
manufacturers hit the proposed regulatory caps for A/C efficiency
technology for both their PC and LT fleets, and different manufacturers
hit caps for off-cycle technologies in the LT regulatory class. DOT
declined to extrapolate off-cycle technology adoption for PCs to the
proposed regulatory cap for a few reasons. First, past EPA Trends
Reports showed that many manufacturers did not adopt off-cycle
technology to their passenger car fleets. Next, manufacturers limited
PC offerings in MY 2020 as compared to historical trends. Last, CBI
compliance data available to DOT indicated a lower adoption of menu
item off-cycle technologies to PCs compared to LTs. DOT accordingly
limited the application of off-cycle FCIVs to 10 g/mi for PCs but
allowed LTs to apply 15 g/mi of off-cycle FCIVs. The inputs for A/C
efficiency technologies were set to 5 g/mi and 7.2 g/mi for PCs and
LTs, respectively. DOT allowed A/C efficiency technologies to reach the
regulatory caps by MY 2024, which is the first year of standards
assessed in this analysis.
    DOT decided to apply the FCIVs in this way because the A/C and off-
cycle

technologies are generally more cost-effective than other technologies.
The details of this assessment (and the calculation) are further
discussed in the CAFE Model Documentation.\298\ The A/C efficiency and
off-cycle adjustment schedules used in this analysis are shown in TSD
Chapter 3.8 and in the Market Data file's Credits and Adjustments
worksheet.
---------------------------------------------------------------------------

    \298\ CAFE Model Documentation, S5.
---------------------------------------------------------------------------

(b) A/C and Off-Cycle Costs
    For this analysis, A/C and off-cycle technologies are applied
independently of the decision trees using the extrapolated values shown
above, so it is necessary to account for the costs of those
technologies independently. Table III-36 shows the costs used for A/C
and off-cycle FCIVs in this analysis. The costs are shown in dollars
per gram of CO2 per mile ($ per g/mile). The A/C efficiency
and off-cycle technology costs are the same costs used in the EPA
Proposed Determination and described in the EPA Proposed Determination
TSD.\299\
---------------------------------------------------------------------------

    \299\ EPA PD TSD. EPA-420-R-16-021. November 2016. At 2-423-2-
245. https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P100Q3L4.pdf. Last
accessed May 24, 2021.
---------------------------------------------------------------------------

    To develop the off-cycle technology costs, DOT selected the 2nd
generic 3 gram/mile package estimated to cost $170 (in 2015$) to apply
in this analysis in $ per gram/mile. DOT updated the costs used in the
Proposed Determination TSD from 2015$ to 2018$, adjusted the costs for
RPE, and applied a relatively flat learning rate. We seek comment on
whether these costs are still appropriate, or whether a different $ per
gram/mile cost should be used. If commenters believe a different $ per
gram/mile cost should be used, we request commenters provide any data
or information on which any alternative costs are based. This should
include a description of how the alternative costs are representative
of costs across the industry, and whether the $ per gram/mile estimate
is based on a package of specific off-cycle technologies.
    Similar to off-cycle technology costs, DOT used the cost estimates
from EPA Proposed Determination TSD for A/C efficiency technologies