Why fuel economy will continue to increase even with Trump’s repeal

I have been a big proponent of capitalism and letting the free-market run things. I have also been a big proponent of environmental regulations, which is why when the Obama regulations of fuel economy was released, I was a huge supporter of it. But, with Trump threatening to end his support of those regulations, I surprisingly do not care about it. And, there is one simple reason for it: car manufacturers will continue to care, especially when the impetus is on them to care.

With the advent of driverless cars, car manufacturers are slowly becoming ride-hailing services and that is not going to end anytime soon. Waymo has already launched a service in Phoenix, with one soon to launch in Atlanta. Cruise AV is already testing in San Francisco, Phoenix, Ann Arbor, and New York City, with plans to launch it live in 2019. Ford sees its AV program launching by 2021. With all of these ride-hailing programs launching, ride-hailing is the future. It is already much more economical to ride-hail than to own your own car, according to many statistics compiled by top news organizations such as Business Insider. That is with the fact that you’re paying mostly for human labor, and in these vehicles, there is no human labour of driving the vehicle.

So, with all these car manufacturers planning on launching AV ride-hailing services, what is the biggest variable cost now that they have? Fuel. When you are in a race to make yourself the dominant player, one of the keys to that is cheapness. The cheaper Waymo or GM is, the better they can market themselves. Therefore, fuel economy will be a huge factor in that, because that’s the one thing that they can control.

And, therefore, it achieves the goal of market economics. In order to achieve a bigger profit, car manufacturers will gradually increase their fuel economy of their cars. With tens of thousands of cars on their fleet, each mpg will save multiple gallons in fuel each year. The savings for companies at this point gets a little wonky because it depends on the prices of gasoline, how much mpg a car gets, etc. There also will be a change in that cars with AV functionality will already wring out the most mpg out of that car because the AV will be most tuned to efficiency than trying to get there on time, etc.

With all this in mind, it would be better to look at new ways to curb greenhouse gas emissions rather than trying to figure out mpg which was already a indirect way of curbing it. We could measure the average greenhouse gas emissions already coming out of a car and could tax that. There also could be alternate ways of taxing it based on fuel prices, such as the already existing gas tax. As AVs get phased in, major metropolitan cities such as SFO, LAX, and others could increase municipal gas taxes to help the push. And, with many of these cities being first in line for these AVs, they could define the AVs of the future.