Are Exhaust Emissions Regulations Too Restrictive?

Most of the American public has heard about the Dieselgate scandal. To be totally honest, it is very difficult to avoid the news anywhere you look. Recent news showed how the auto manufacturer Mitsubishi admitted that it has ‘cheated’ fuel economy tests for the last 25 years. While hardly an epidemic, we now have two international car companies that have been found with their hands in the proverbial cookie jar. It begs the question – are emissions regulations too restrictive?

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Mitsubishi knowingly committed these acts over a twenty-five year span and about 625,000 vehicles are under this scope of improper testing. The numbers could sway wildly in the days and weeks to come, but Wall St. had no problems reacting to the news. The company’s value took a major hit, losing about $3.9 billion to date since the news first broke. The United States Environmental Protection Agency (EPA) has also ordered the company to retest its vehicles.

Mitsubishi vehicles underwent a variety of tests that toyed with standards set in Japan starting in 1991. Adding the spectre of egregiousness, Mitsubishi reports having discovered the fault in 2001, but they refused to update testing methodologies. The company thus far reports that four models were part of the manipulated data. They include:
the eK Wagon and eK Space, which are manufactured and sold by Mitsubishi, and the Dayz and Dayz Roox which is anufactured by Mitsubishi and supplied to Nissan Motor Company.

The question remains. Are these companies cheating to gain profitability? How could it have gone on for so long? Are worldwide regulatory agencies creating a tough situation where companies are choosing this self-destructive path?

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