BMW hopes to get out from under the gas-guzzler taxes

Source: BMWblog.com

Jim O’Donnell, president of BMW of North America, says the company is studying fuel-efficiency improvements that could eliminate the gas-guzzler taxes on its vehicles as early as the launch of their redesigns in the next few years.

For year 2010, several BMW models incur a gas-guzzler fee. For example, the BMW 550i GT and 750i get “hit” with a $1,000 fee, the 650i Convertible faces a $1,300 tax.

In an interview for Automotive News, O’Donnell said that BMWwould like to get away from it across the entire lineup and the gas-guzzler label slapped on a BMW is what they company is trying to avoid.


The Gas Guzzler Tax is a Federal excise tax applied to the domestic sale of new vehicles that don’t meet certain fuel economy standards. Vehicles that get at least 22.5 mpg (combined) don’t have to pay the Gas Guzzler Tax. The Tax rate goes from $1,000 for vehicles that get at least 21.5 mpg (combined), but less than 22.5 mpg (combined) all the way up to $7,700 for vehicles that get less than 12.5 mpg (combined).

BMW’s smaller competitor, Infiniti, moved its new-generation M56 sedan out of gas-guzzler status this year. It did so despite increasing horsepower from the previous-generation M sedan, which competes directly against the BMW 5 series.

In 2012, a new California regulation will go in effect. The new law stipulates that large auto makers to sell between a few hundred and a few thousand Zero Emission Vehicle every year starting in 2012. Under the Californian regulations, the Zero Emission Vehicles can either be a fuel cell or battery-powered vehicle with a range of over 200 miles, or an Advanced Technology, Partial Zero-Emission Vehicle (AT-PZEV) powered by a hybrid powertrain, by compressed natural gas (CNG) or by a methanol fuel cell.

Along with the large investment in electric mobility, BMWis also moving away from its powerful and highly-acclaimed natural aspirated engines to turbocharged powerplants.

If the current BMW M5 gets just 11 mph city/17 highway and incurs a $3,000 tax due to its V10 engine, the upcoming M5 will be powered by a turbocharged V8 engine. Furthermore, BMW plans to use several new technologies and a KERS system that will put the new M5 ahead of the current model, both in performance and fuel efficiency.

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