After the euphoria of the Swinging ’60s continued into early ’70s, the world was in for a rude awakening.
The Arab Oil Embargo of late 1973, EPA (Environment Protection Agency of USA), NHTSA (National Highway Traffic Safety Administration of USA), all seemed to be ganging up on automobiles.
The Oil Embargo caused fuel shortages and drove prices up. EPA demanded modifications to reduce pollutant emissions. NHTSA mandated safety standards and a 55mph speed limit on all interstate highways.
These standards were not uniform the world over, so motor manufacturers had to produce cars specifically tailored for the American market. What was gloom for domestic and European car makers was a blessing for the Japanese motor industry. All they produced at the time were small fuel-efficient cars, which was the need of the times. And Japanese were willing to make them compliant with EPA and NHTSA standards without creating a fuss. The cherry on the proverbial cake was “reliability”, an alien concept to European brands which were the main competition to the Japanese.
The emission regulations strangled the power output of once mighty American engines. Speed became a dirty word, and fuel economy became the buzzword.
This rang the death knell for the only viable rival for the piston engine: the Wankel Rotary engine. It was a physically smaller engine with fewer parts, but had higher fuel and oil consumption and higher exhaust emissions. The weaknesses could have been overcome with time and development, but the environment had turned hostile for the newbie.
The decade ended with another oil crisis in the wake of Iranian Revolution (Shah of Iran was driven away and Khomeini took over). There were fuel shortages, so panic buying ensued, driving prices up.
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