Automakers fined millions for not meeting fuel economy requirements

 The Volkswagen Touareg does well off road, but its 
 low gas mileage caused VW to be fined $4.5 million.

Six automakers paid the National Highway Traffic Safety Administration a combined $38 million in fines last year after their cars did not meet federal fuel economy requirements, the according to the Associated Press.

Ferrari, Saleen, Porsche, Maserati, Mercedes-Benz, and Volkswagen did not meet the Corporate Average Fuel Economy (CAFE) requirements of 27.5 miles per gallon for passenger cars and 22.5 miles per gallon for light trucks.

The fines are based on how much an a car line's average gas mileage missed the requirement and on how many offending products were sold, making it relatively easy for low-volume luxury automakers to sell a handful of powerful fuel-swilling cars.

Saleen, for example, paid around $41,000 to sell its 13-mpg performance cars for four years. Mercedes-Benz, however, was responsible for $29 million. Volkswagen, though best known for its compact cars, had to pay $4.5 million in fines for the low mileage of its Touareg SUV.

While these fines are steep, it's cheaper for many automakers to pay them than to re-engineer their products. The Associated Press story referred to the fines as a just another part of "the cost of doing business" for some automakers which are routinely fined.

As CAFE standards increase on their way to 35 miles per gallon for cars and light trucks by 2010, expect to see more and more automakers paying fines. Their financial case might be stronger to pay a few million in fines than to invest billions in extra fuel efficiency while risking losing customers who have come to expect bigger cars, extra power, and lower prices.