Thirty-four years ago, the U.S. government, in its wisdom, gave us corporate average fuel economy regulations. CAFE didn't work then, and it still doesn't.
We had to change consumer habits. But Congress and the executive branch didn't have the guts to do what should have been done to reduce fuel consumption and encourage development of alternative fuels. They don't have the guts now either.
Politicians are afraid of what voters would do so the choice is for politicians to do nothing or dump the responsibility on the manufacturer.
We saw what happened when gasoline went to $4 a gallon. U.S. consumers moved toward smaller vehicles. When gasoline went back to $2 a gallon, their old buying habits came back. It was simple. U.S. consumers react to higher fuel costs without any laws. That has been happening in the rest of the world for decades.
If the government slowly raised the base price of gasoline with a fuel tax and kept raising it for several years until the price was, say, a minimum of $3.50 a gallon, manufacturers could plan on a stable market.
As fuel prices rose, the tax could be reduced. When fuel reached $3.50 a gallon, the tax could be eliminated and the market could take over. If the price dropped below $3.50 a gallon, the tax would again be applied to keep the base price at that level.
No White House or Congress since the mid-1970s has had the gumption to raise gasoline taxes for fear of voter revolt.
By putting the entire onus on the manufacturer, Congress and the White House can appear finally to be doing something. But that process will take a lot longer.
CAFE has been a can of worms for more than three decades, and it hasn't encouraged the development of diesel or other fuels.
Once again, the government has ignored the problem and the solution. As fuel prices go up again, we may be able to ignore the law and let the marketplace prevail.
Meanwhile, the manufacturers can breathe a sigh of relief that they don't have to start building two or three or four versions of their vehicles to satisfy various states' emission requirements. That may be the only good thing to come of this.
So maybe the factories got more than anyone figured.