Tougher Fuel Economy Rules May Change Market

The Obama administration has set tougher gas mileage standards for new cars and trucks, spurring the next generation of fuel-sipping gas-electric hybrids, efficient engines and electric cars.

The heads of the Transportation Department and the Environmental Protection Agency signed final rules setting fuel efficiency standards for model years 2012-2016, with a goal of achieving by 2016 the equivalent of 35.5 miles per gallon combined for cars and trucks, an increase of nearly 10 mpg over current standards set by the National Highway Traffic Safety Administration.

The EPA set a tailpipe emissions standard of 250 grams (8.75 ounces) of carbon dioxide per mile for vehicles sold in 2016, equal to what would be emitted by vehicles meeting the mileage standard. The EPA issued its first rules ever on vehicle greenhouse gas emissions following a 2007 Supreme Court decision.

"These historic new standards set ambitious, but achievable, fuel economy requirements for the automotive industry that will also encourage new and emerging technologies," Transportation Secretary Ray LaHood said in a statement. "We will be helping American motorists save money at the pump, while putting less pollution in the air."

--AP