One Washington, DC-based startup is looking to create a market for trading automaker "credits" that will allow gas-guzzler makers to "meet" stricter US fuel-economy requirements during the next few years, Automotive News reports.

Mobilis Trading, which launched last year, has an idea for auction site where automakers without a strong heritage of fuel efficiency, like Rolls-Royce, could buy Corporate Average Fuel Economy (CAFE) credits from companies like Honda and Toyota in order to avoid getting dinged by the government for not meeting fleetwide requirements. In the past, many companies have been happy to pay fines for missing fuel-economy quotas, but that will not be enough as the rules get stricter. Over the last 25 years, BMW, Jaguar and Porsche have paid $18 million in fines, the publication says, citing figures from the National Highway Traffic Safety Administration (NHTSA).

Under the new CAFE rules, automakers need to increase fleetwide new-vehicle fuel economy to 54.5 miles per gallon (around 40 miles per gallon in real-world figures) by 2025. Mobilis hasn't conducted any auctions yet.


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    • 1 Second Ago
  • 9 Comments
      Spec
      • 2 Days Ago
      Let's take a clunky system and make it even more arcane. No. A better solution is the fee-bate. Raise the gas tax but return the money back in lower income taxes or something.
        2 wheeled menace
        • 2 Days Ago
        @Spec
        Redistribute wealth at the pump? Cmon man, how long have you been on this planet? When you ask government to tax you more, do you really think you get that back somehow? social security and medicare funds were raided long ago.. we're 16 trillion dollars in debt, and the federal government is cutting your benefits while raising taxes, but somehow still keeps increasing the military budget... how does that work? Maybe you get something back if you paid taxes if you lived in Sweden or Finland or something, but not here!
      2 wheeled menace
      • 2 Days Ago
      An auction based on a fictional asset(?) created in order to tax manufacturers for not making cars clean enough.. Reminds me of something ridiculous like the derivatives market or credit swaps.. I have a really simple idea... stop subsidizing oil. The price will rise and folks will use less. All these rediculous schemes like RIN credits, CAFE credits, ZEV brownie points ( or whatever they're called ) are less effective ways of trying to manipulate the free market. High oil prices will do what these schemes aim to do - without the complexity, with more freedom, and less fraud. Russia Times is reporting that 2 trillion dollars went into oil subsidies in 2011.
        Rotation
        • 2 Days Ago
        @2 wheeled menace
        The EPA is hugely in favor of pollution credits, it is considered to be a superior system to other ways to doing controlling emissions. Personally, I'm skeptical as I am with carbon credits. The buyer doesn't care if the credit is counterfeit, and the seller obviously has incentive to counterfeit too. So it seems like cheating would be rife. And in carbon credits, it seems it is.
      Spec
      • 2 Days Ago
      OK, then just do the tax then don't bother to give the money back. High taxes is what people should want if they actually want the government to shrink. High taxes will get people mad such that they demand cuts. The 'starve the beast' model from Grover Norquist and his conservative allies back-fired. By cutting taxes (and borrowing instead) people didn't care what the government spent on and the government grew instead of shrunk.
      Reggie
      • 2 Days Ago
      Invisible 7 MPG trucks that chuck out more pollution than anywhere else on the planet will be EXEMPT, they are invisible they don't really exist.
      2 wheeled menace
      • 2 Days Ago
      Either ways you end up with more government. Look at the track record. Our government doesn't shrink, it's a one way street. The last time since the 1970's that we paid down any of our debt was one year under Bill Clinton in the middle of the dot com boom. You can raise taxes and people still won't care about how it is spent. There is no accountability.
      Rotation
      • 2 Days Ago
      Only problem is it's not legal. CAFE credits are not transferrable. Hence the "corporate average fleet" portion of its name.