Earlier quoted context omitted.
I have a few friends that are engineers in the auto companies. Its kind of amazing how many negative impacts the CAFE standards had--not on purpose (hopefully), but through unintended consequences. Apparently the Nissan Leaf for example was strictly manufactured to generate credits/offset the environmental impact of the Nissan truck and van line that could not be adjusted to meet the CAFE standards. My dad had a Rang…
The "negative" impacts of CAFE standards were entirely by design. They were written that way to benefit the domestic auto industry, which is very uncompetitive in the small and midsized vehicle segments. By making smaller vehicles uncompetitive (or simply unavailable), it eliminated some serious competition.
You're right that CAFE is literally designed to favor trucks. And the definition is so vague that even vehicles like the PT Cruiser are considered Light Trucks for the purposes of CAFE. It is also designed to hurt small cars, because vehicles with footprints (wheelbase * wheel wide) smaller than a Mustang (literally, to the square inch) have to face ever-more-strict CAFE standards.
As a result, cars like the Fit are might face a CAFE penalty while a base F150 does a-okay despite getting like half the fuel economy. And that's not even getting into BS like flex fuel credits (basically, being flex fuel capable is like adding ~5mpg to the vehicle CAFE score).
This is exactly why every small vehicle is a crossover anymore (they are light trucks for CAFE purposes), and why cars like the Civic get are today, the size an Accord was in 2005 (CAFE is less strict the larger the vehicle is).