Toyota says new CAFE regs will hurt bottom line
Toyota has announced in its annual fiscal report that new Corporate Average Fuel Economy (CAFE) standards for light trucks could hurt its bottom line. While the car CAFE standard of 27.5 MPG will remain the same in the near future, the truck standard increases from 20.7 MPG to 22.2 MPG over the next three years. Since Toyota’s larger SUVs and pickups fall well short of this new standard despite the company’s “green” image (physics can be such a bummer), they will have to find a way to reduce production of their thirstiest models, or produce greater numbers of more efficient models. That means a reduction in profits, based on current market conditions.
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