NADA Fails Proposed Fuel Economy Labels

Posted: Sep 07, 2010 10:38 a.m.

On August 31, the Environmental Protection Agency (EPA) proposed new labels for cars and trucks that indicate their fuel consumption, annual fuel costs and environmental impact. One label gives cars a letter grade, ranging from A-plus to D, based on fuel economy and green house gas emissions. The other accommodates new electric and hybrid vehicles by listing MPG ratings, battery charge time, range and annual electric cost.

If approved, the new stickers will help consumers determine the best car options in a changing market that includes more electric and hybrid vehicles. “New fuel economy labels will keep pace with the new generation of fuel efficient cars and trucks rolling off the line, and provide simple, straightforward updates to inform consumers about their choices in a rapidly changing market. We want to help buyers find vehicles that meet their needs, keep the air clean and save them money at the pump,” EPA administrator Lisa Jackson states in a press release. New labels will help consumers choose fuel efficient vehicles that fit their budgets.

The National Automobile Deals Association (NADA), however, believes the new letter-grade label is too expensive to produce, will increase the price of new cars and will confuse consumers with extraneous details. “America’s new car and truck dealers support higher fuel economy standards, but recognize that for most Americans a car or truck is a necessity, not a luxury,” the NADA states in a release. “Under these new mandates, the price of new cars and light trucks will rise significantly, meaning fewer Americans will be able to buy the new vehicles of their choice. With tight family budgets and a shaky job outlook, consumers want to maximize their transportation dollars, not pay more for redundant rules and an unnecessary bureaucracy.”

Autoblog Green says the NADA’s complaints about the letter-grade label are ill-advised. “Since the proposed grades would give a rating that is relative to similar vehicles, it shouldn't really matter what the fuel type is,” Autoblog Green explains. “If a compact sedan with a gasoline engine gets a C compared to a similar vehicle with electric drive that gets an A, that seems perfectly reasonable.”

While opinions of the new labels vary, they are necessary. Detroit News reports that new labels are a necessity because the “34-year-old stickers are badly in need of updating. Some updates are required by a 2007 energy law.”

For now, the EPA created a forum that allows consumers to post their opinions of the new label.

If you’re in the market for a gasoline or electric car, check out the U.S. News rankings of this year's best cars as well as this month's best car deals.