A Billion-Dollar Fine Looms Over Ford Due to U.S. Fuel Economy Regulations
Ford Motor Company is facing a fine of one billion dollars for the first time, spanning from 2027 to 2032, based on stringent American regulations governing fuel economy. These regulations target manufacturers of SUVs and trucks, according to a filing submitted by the automotive company headquartered in Dearborn to the U.S. federal government.
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The National Highway Traffic Safety Administration has proposed new rules for the entire vehicle fleet, known as the “Corporate Average Fuel Economy” standard. These new rules estimate fuel consumption at 58 miles (approximately 93 kilometres) per gallon by 2032. These stricter rules are part of President Biden’s efforts to reduce emissions and expedite America’s transition to electric vehicles.
The company stated online on Tuesday that this decision would disproportionately affect Ford and other automakers in Detroit.
The company added, “Ford has never been subject to civil fines under the Corporate Average Fuel Economy program. However, according to an analysis by the National Highway Traffic Safety Administration, it is likely that Ford will face a civil fine of one billion dollars when the proposed law is enacted.”
The company noted that this raises significant concerns and threatens major economic challenges for Ford.
Ford’s competitors in Detroit, such as General Motors and Stellantis,
are also expected to face fines under the law proposed by the Biden administration,
according to the American Automotive Policy Council,
the trade group responsible for both manufacturers based in Washington.
Under the current terms of the proposed law,
General Motors would face fines of approximately 6.5 billion dollars over five years,
while Stellantis would pay fines amounting to 3 billion dollars.
A Billion-Dollar Fine Looms Over Ford