WASHINGTON -- The Bush administration said Wednesday it won't finish implementing new vehicle fuel-economy rules, leaving the issue to the incoming Obama administration.
The Transportation Department said in a statement that automakers' recent financial problems will require the next administration "to conduct a thorough review of matters affecting the industry."
The auto industry was swift to criticize the decision, saying any delay could cost them money.
"I think that all along manufacturers have said we need certainty. ... Anything that delays that makes it more difficult," said Charles Territo, a spokesman for the Alliance of Automobile Manufacturers. "We had expected that these rules would have been finalized last year."
The department is required to set rules by April 1, 2009 for how automakers are to meet new fuel economy standards.
On Earth Day last spring, Bush administration Transportation Secretary Mary Peters laid out proposed rules that she said would require the next generation of new cars and trucks to meet a fleet average of 31.6 miles per gallon by 2015. A law Congress passed in 2007 requires that by 2020 new cars and trucks meet 35 mpg, a 40 percent increase over current standards.
Territo said it will cost the industry an estimated $47 billion to comply with the new standards.
"There's no question that this rule will come with a significant cost to manufacturers," Territo said.
General Motors Corp. and Chrysler LLC are struggling to survive and have received a federal bailout.
The Bush administration's proposed implementation proposal was expected to save nearly 55 billion gallons of oil and reduce carbon dioxide emissions by 521 million metric tons over the life of the new vehicles built between 2011-2015. It would add an average cost of $650 per passenger car and $979 per truck by 2015.
Environmental groups and their allies in Congress had criticized the Bush proposal as not aggressive enough and said it would pre-empt a California law that sets tough standard for automobile greenhouse gas emissions.
"Nonetheless, it's nothing short of stunning that the Bush administration would walk away from this issue after putting out so much publicity about how they intended to deal with it," said Frank O'Donnell, president of Clean Air Watch.
In the past, automakers have fiercely opposed increases in fuel economy standards. But in 2007 they supported a compromise that requires the auto industry to implement more than half of the fuel-efficiency improvements by 2015 and pushes them to build more gas-electric hybrid cars and diesel-powered trucks and SUVs.