Mr. Porsche goes to Washington: Low-volume CAFE classification could save Porsche millions
The Senate bill to raise CAFE changes the definition of a low-volume manufacturer from a company that produces 10,000 cars worldwide per year, to a company that has less than 0.4-percent of the US market -- which would be about 64,000 vehicles currently. Porsche sold 34,227 cars and SUVs in the U.S. last year, and if the new classification stands, as a low-volume manufacturer Porsche could benefit from relaxed standards and save itself a heap of money in fines. The provision would also open the door for Jaguar and Land Rover to be reclassified once they are sold.Under current CAFE regulations, Porsche paid $4.6 million in fines last year. When the new regulations are adopted, that number stands to increase significantly, which is why Porsche wants to keep the new low-volume provision in tact and has hired a full-time lobbyist to make that happen. Other automakers, of course, are not too happy about Porsche's efforts, with a Mercedes lobbyist saying 64,000 cars "isn't really a small number." The question is, could a Porsche that owns VW still be a low-volume manufacturer?
[Source: Auto News, sub req'd]
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Reader Comments (Page 1 of 2)
Carlos 6:40PM (11/26/2007)
Hard to push your sob story when you're as profitable as Porsche's been lately.
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Temple 11:59PM (11/26/2007)
Yeah really Porsche is raking in money; 0.4% of the US market? Going by market-share that means that failing companies like Isuzu or emerging Chinese brands could enter the US market and pollute as much as Porsche as long as their market share is below 0.4%.
Mike 6:53PM (11/26/2007)
"in tact"
oh boy.....here we go again...
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Big Rocket 6:58PM (11/26/2007)
I find the low-volume CAFE exemption to be wrong in principle, whether the limit is 10,000 vehicles or 64,000 vehicles. Most, if not all, of the low-volume cars are exclusive and expensive cars owned by the very wealthy. A low-volume exemption essentially means one law for the rich, and another law for the rest of society. If a car burns gas at 10 mpg, it should be penalized by the same CAFE standard no matter its production rate, its price tag, or the income level of its customers.
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Whitie 8:18PM (11/26/2007)
Absolutely agreed.
The Other Bob 8:37AM (11/27/2007)
So do you think that there should be a Porche economy car to make them CAFE compliant? That is what would be required to offset the low-mileage performance cars.
cheezwiz 9:23AM (11/27/2007)
bob #2: I think the poster means that porsche should pay the fine regardless of whether they sell 500 or 500,000. In theory, this would make sense because it would increase the cost of the porsches and increase their rarity. These things used to be exotic and exclusive.
Plus, it seems silly to harm American mainstays like GM while kowtowing to expensive German imports. I'm not saying I'm for or against CAFE, but Big Rocket has a point - make it uniform.
jgp 7:02PM (11/26/2007)
I'd rather just get rid of CAFE entirely.
Gaddamn socialists are trying to turn the US into Soviet Russia.
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Cameron 7:38PM (11/26/2007)
I had a huge response ready for you, and then I realized why even bother?
Your post hemorrhaged with ignorance.
Aren't you missing Rush Limbaugh?
rgseidl 6:02AM (11/27/2007)
The US should consider dropping both CAFE and the gas guzzler tax in favor of a surtax on fuel. This could start at 8 cents per gallon and then rise slowly, predictably but irreversibly by an additional 2 cents each month for a minimum of 8 years. At that point, the surtax would be $2.00 per gallon. The (substantial) additional revenue collected in each state would stay there in the form of cuts in general sales tax and/or flat-rate income tax credits. The point is not to increase the total tax burden - especially that on low earners - but rather, to shift it laterally to a different source.
Btw, if the proposed change in the definition of "low-volume manufacturer" doesn't make it into law, Porsche still has the option of making their engines E85-compatible. The cost is peanuts and the Big Three have been exploiting this particular loophole for years.
Steven 7:04PM (11/26/2007)
If the CAFE regulations are too hard to meet, there could be a loophole (as hinted at in the blog): MFR's that create many subsidiaries (on paper) such that each makes less than 0.4% of the market share.
I.E. Corvette, which sells about 35,000 per year, becomes its own brand.
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Farris 7:21PM (11/26/2007)
Um, forgive my ineptitude... but who does the money from the "fines" that Porsche pays for the CAFE standards go to?
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rgseidl 5:50AM (11/27/2007)
The gas guzzler program is administered by the IRS.
Dave 7:59PM (11/26/2007)
I'm mixed on this- on the one hand do rich people really need a discount on their flashy sports cars? But on the other hand, this might get other manufactures to bring interesting vehicles to the states. If Lotus hadn't gotten a safety exception there would be no Elise from what I understand. I just wish Porsche would make it's cars a little less overpriced so that it wasn't a Dr's car to combat midlife crisis. But I'm not holding my breath for that one either...
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zamafir 9:39PM (11/26/2007)
Man, this is great. Porsche, the most profitable car company on earth, who clearly isn't a "low volume" manufacture, simply slides thorough a loop hole in the system (which is easily construed to apply more aptly to companies such as Lotus, et-al). Leave it to porsche to continue their profit streak by exploiting loop holes such as this, and to CAFE for revising the standard in such as way that blunders like this are possible.
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why not the LS2/LS7? 10:41PM (11/26/2007)
This is just wrong. It shows why you can't put loopholes like this in. You put them in for Lotus or Tesla and Porsche comes in and says they should have it too.
We shouldn't have rules to let companies pollute more. It's difficult to tell GM they have to follow the rules when Porsche (soon to be Porsche VW) doesn't.
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tcc3 12:24PM (11/27/2007)
I imagine Tesla doest need the loophole
Austin M 11:17PM (11/26/2007)
Woohoo!!! Now if only we could get this same exemption for airbags on low-volume-production sports cars. I miss good looking steering wheels.
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paul34 12:06AM (11/27/2007)
I don't really consider Porsche a "small" company - but for someone like Ferrari, Lamborghini, etc, I wouldn't mind those guys having relaxed standards; they'll inevitably reduce their emissions anyway since they'll be doing so on the other side of the pond anyhoo.
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nirad 11:46AM (11/27/2007)
CAFE standards are calculated for a total fleet for a manufacturer, correct? So wouldn't Porsche now be included in VW/Audi's fleet, since they own them?
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