Obama administration raises fuel-economy regulations to 27.3 mpg by 2011

The Obama Administration announced today that it will require the nation’s 2011 model year cars and trucks to meet a fleetwide average of 27.3 mpg or 8 percent above the 2010 model year requirement of 25.3 mpg.

The new fuel-efficiency standards come a day after Obama strongly hinted that his administration will provide the auto industry with more government loans. Of course, the news is a shock to GM, Chrysler and other automakers who are looking to cut their work force, reduce cost and produce more fuel-efficient vehicles.

A majority of automakers have previously said that stricter fuel-efficiency standards will cost them billions of dollars.

Obama said yesterday that he is willing to provide additional aid given that the auto industry must be willing to face tougher restructuring conditions. General Motors and Chrysler have requested an additional $21.6 billion in government aid.

– By: Kap Shah

Source: Detroit News