As a general rule, reduced fuel consumption comes at a cost. The cost may be due to more expensive materials, increased manufacturing complexity, or a tradeoff with other vehicle attributes such as power or size. In addition to increased manufacturing costs, other costs of doing business are likely to be affected to a greater or lesser degree.

These indirect costs include research and development (R&D), pensions and health care, warranties, advertising, maintaining a dealer network, and profits. The most appropriate measure of cost for the purpose of evaluating the costs and benefits of fuel economy regulations is the long-run increase in retail price paid by consumers under competitive market conditions. The retail price equivalent (RPE) cost of decreasing fuel consumption includes not only changes in manufacturing costs but also any induced changes in indirect costs and profit.
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Although each vehicle manufacturer has a proprietary way of defining very precisely how its vehicle must perform, it is assumed here that the following parameters will remain essentially constant as the technologies that reduce fuel consumption are considered:

• Interior passenger volume;
• Trunk space, except for hybrids, where trunk space may be compromised;
• Acceleration, which is measured in a variety of tests, such as time to accelerate from 0 to 60 mph, 0 to 30, 55 to 65 (passing), 30 to 45, entrance ramp to highway, etc.;
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