Obama Administration Raises Fuel Economy Level to 27.3 mpg

Apart from the already known effects of the pending economic crisis that has savaged the automotive industry, US automakers will have to deal with yet another thorny issue as the Obama administration has decided to raise the bar on fuel economy.

According to The Detroit News, the 2011 model year cars to be available for purchase in the fall of 2010 and trucks will have to average 27.3 miles per gallon, an impressive 8 percent increase over the 2010 standard of 25.3 miles per gallon. The aforementioned 8 percent increase translates into an average of 30.2 mpg for cars and 24.1 mpg for light trucks.

"These standards are important steps in the nation's quest to achieve energy independence and bring more fuel-efficient vehicles to American families," Transporation Secretary Ray LaHood said in a statement.

As with most regulations, this one doesn't come cheap either as it's estimated it will cost automakers around $1.46 billion to improve the fuel consumption technologies and to review the 2011 models.

As The Detroit News points out, the 2011 regulation doesn't go as far as what the Bush administration proposed in April 2008.

“Instead, the fuel efficiency figures for 2011 are identical to a final, unreleased Bush administration proposal that had been cleared by the White House for final publication in October,” the aforementioned source said.

In other automotive mayhem news, Rick Wagoner, chairman and CEO, will leave the company immediately to be replaced by Fritz Henderson, GM president and chief operating officer. Apparently, the Administration officials asked him to step aside, but no other reasons were provided for this strange decision.