Take a longing look at your neighbor’s Land Rover or Mercedes-Benz S-Class. Within a decade, they could be goners from the US market because of a proposed 56 mpg fuel economy rule that benefits the largest automakers at the expense of boutique brands with the biggest and fastest cars. The US Environmental Protection Agency proposes that the tougher corporate average fuel economy, or CAFE, rise from 27 mpg to 56 mpg by 2025. Models that don’t meet the standard would face fines of up to $25,000 per offending vehicle. The way CAFE works now, an automaker blends the mileage of all cars sold. Lexus lives under the umbrella of Toyota, Audi under Volkswagen, so they’re better off than Land Rover, which is part of India’s Tata, a company with no US sales.

There’s no question the heat is on automakers to improve fuel economy and that improvements are being made. That’s why Ford is expanding the use of its EcoBoost engines from small cars to midsize and now full-size cars. The smallest cars will get three not four cylinders with a turbocharger; the biggest including pickup trucks get six cylinders with a turbo instead of a V8. BMW just announced it will offer a four-cylinder engine with a turbocharger as the entry engine in its 5 Series (photo below); on the highway, it should get around 37 mpg. Better, but still a long way from 56 mpg.

Today, if a model doesn’t meet the 27 mpg standard, it pays a gas guzzler tax that can run to $1,000 for powerful cars. (Technically, $5.50 for every 0.1 mpg below 27.3 mpg multiplied by sales.) The Lamborghini Murcielago gets hit with a $6,400 penalty, but that’s a rounding error for a car starting at $354,000. There are ways to work around the 27 mpg standard. The government gives an implied fuel economy credit for vehicles than run on E85 fuel that is 85% ethanol and 15% gasoline, never mind that in most parts of the country you can’t buy E85. Vehicles intended for farm use such as big pickup trucks also get a break but no one from the government checks to see if exempted trucks are really used in farming.

The proposed 56 mpg standard has car manufacturers nervous, especially German automakers. The 56 mpg standard is only a proposal from the EPA, but it’s scary even to automakers with good lobbyists in Washington. (Which would be every automaker.) Edmunds.com analyst Bill Visnic told The Wall Street Journal, “This is basically an attack on the way they [Germans] do business because the things they traditionally sell are based on size and power. To do something like this is essentially putting them out of business here.”

Here are five scenarios for how the mpg battle will play out and how high-prestige, low-mpg automakers will survive:

1. The 56 mpg standard is scaled back to, say 50 mpg. The phase-in scheduled for five years from now (2016) might be pushed back, and so too might the 2025 deadline. Loopholes such as the ethanol trick and other special (legal) ways of calculating mileage that don’t appear on a new car’s window sticker, but do count toward CAFE, might effectively make the 2025 limit 45 mpg. Still high but not quite as high.

2. Automakers will continue to improve mileage and get closer. EPA testing rules now take advantage of engines that shut down at traffic lights (called start-stop, stop-start or auto-stop engines), so those engines will become the norm. Stop-start cars will need bigger batteries and accessories (power steering, air conditioning) and will switch from mechanical devices driven by the turning engine to electrical devices. Steel panels will be made from lighter steel, aluminum, or plastic, all of which cost more. There will be more hybrids sold although they’ll still be a small fraction of all sales (less than 10%).

3. Bigger-engine cars will be priced higher to push customers to the more economical trim lines. Right now the BMW 5 Series jumps about 10% from the small six-cylinder engine (or the turbo four for 2012) to the turbocharged six, and another 10% to the V8 model. Make those price deltas 20% each and Bimmer fans will learn to love smaller engines. (The turbo four actually has more horsepower and torque than the six-cylinder engine it replaces.)

4. Similarly, bigger cars that burn more fuel could carry a disproportionately higher upcharge than their actual costs to build. If the current price hike from compact to intermediate to full-size is 15% and 15%, it could be raised to 20%. One problem with this: Americans’ expanding waistlines mean we need bigger cars for our bigger butts. A consumption tax on junk food would lead to smaller waistlines and smaller cars … eventually.

5. Small automakers with lower fuel economy ratings will be forced to buy or merge with high-mpg automakers. BMW Group owns Mini (also Rolls-Royce) but the more efficient Mini brand is only one-fifth of the group’s U.S. sales. So BMW Group might need to ramp up Mini sales to exceed BMWs or find common ground with a Hyundai, Honda, Mazda, or an emerging Chinese automaker looking to sell in the US. Volkswagen Group already has the problem resolved with controlling interests in Audi, Skoda, SEAT, Lamborghini, Bentley, and Bugatti. It’s also possible the automakers, without merging, could trade mpg credits the way factories in the US can now trade pollution credits so on average they meet emissions rules.

What the government proposes is probably for the common good. But there are huge costs involved. There’s no guarantee the entire US fleet in 2025 really can meet a 56 mpg standard. There’s an element of social engineering and stick-it-to-the-rich at work here, just as there was when Bill Gates sought to import an exotic Porsche 959 into the US and was turned down because the non-standard-height bumpers might get dinged in a parking lot incident and it would emit more pollutants into the air. Per mile, yes. Per car, not a chance. The typical exotic car such as the 11 mpg Lamborghini Murcielago is driven about 2,500 miles a year. It burns 250 gallons of gasoline. Sitting in the garage, it uses the same amount of fuel – none – as a Toyota Prius.

Read more at the US Department of Energy