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Automakers Balk at New Fuel Bill; Compromise Expected
Automakers described as ‘unattainable’ the revised fuel economy proposal unveiled last Friday by a Senate committee chairman. The new bill, when approved, would force the automakers to significantly increase the fuel economy standards to a fleetwide average of 28.5 miles per gallon by 2015 and 35 mpg by the year 2020, with four percent increases every year after that.
The bill, as proposed by U.S. Sen. Daniel Inouye, D-Hawaii, the chair of the Senate Commerce, Science and Transportation Committee, and Alaska's Ted Stevens, the committee's ranking Republican, is expected to entertain amendments to respond to the automakers’ clamor. The bill will now be facing a vote in committee on whether to deliver the same to the full Senate.
Sen. Inouye said that many senate staffs had worked for 10 days to reach a compromise bill that automakers could accept. "None of us here want to put our domestic automakers out of business," Inouye said. "You will find most of your concerns have been addressed."
Automakers said last Friday that the proposal was about as bad as they could have imagined. Since the proposal of the bill, criticism has never come to a halt. The EBC brake pads also may not be successful in stopping the ridicule from spilling over.
"Basically, it is unattainable up until 2020 and unattainable afterward," said Gloria Bergquist, a spokeswoman for the Alliance of Automobile Manufacturers, the trade group that represents the General Motors Corp., Ford Motor Co., DaimlerChrysler AG, the Toyota Motor Corp. and other automakers. "We think this is still going to be a big burden on Americans who need work vehicles."
U.S. Sen. Carl Levin, D-Detroit, who has been actively lobbying colleagues in recent days, criticized the draft for being too complicated and including some issues that had not been proposed earlier. "For instance, it includes a requirement to increase CAFE standards by four percent per year after 2020," Levin said in a statement. "More progress can be made in reducing oil consumption and greenhouse gas emissions if we focus our resources on leap-ahead technologies instead of forcing companies to make incremental improvements to meet an arbitrary standard."
The Congress mandated automakers to increase passenger car fuel economy from an average of 13 mpg to 27.5 mpg in 1975. That standard has remained untouched because vehicle manufacturers have dynamically lobbied against increases.
The bill comes amid increasing concerns in Congress about the effect of auto tailpipe emissions on climate change. To stress, vehicles in the United States account for about 20 percent of greenhouse gas emissions in the US and about five percent worldwide. The bill would also regulate the fuel economy of medium and heavy-duty trucks thus imposing a four percent yearly improvement commencing in 2011.
The proposed bill would empower the National Highway Traffic Safety Administration (NHTSA) to set fuel economy standards and do it based on size, as NHTSA has already implemented for light trucks. Additionally, the bill has "off ramps" that give the government agency discretion to cut fuel economy mandates if it determines they are not cost effective or not feasible in a given model year. The agency also has to issue new safety rules to enhance the compatibility of vehicle bumper heights to ensure car occupants’ protection when different sized vehicles collide.
One controversial issue behind the proposed bill is the whether the agency would be under pressure not to use the off-ramps for domestic automakers if the Toyota Motor Corp. and the Honda Motor Co. are able to meet the requirements.
Automakers also are dismayed that after the 2009 model year they would lose the fuel economy credit for building flexible-fuel vehicles that run on E85 - a fuel made of 85 percent ethanol. But they would be able to use CAFE credits earned for five years and also would be able to purchase and sell credits among manufacturers.
Automakers can use "credits" to meet fuel economy mandates, even though their vehicles are less efficient than required and there is no requirement that consumers actually use alternative fuels. The credit trading system would amount to a "wealth transfer" between automakers and have no impact on improving the environment, Bergquist said.
Experts in the industry said that it might require GM, Ford and Chrysler to pay hundreds of millions of dollars to Toyota and Honda in order to comply with the law. The bill also would require a new labeling program to promote the vehicles that have superb fuel economy and the lowest greenhouse gas emissions.
Joan Claybrook, an environmental advocate who heads Public Citizen, said that the bill "does not go far enough. “Automakers could easily hit 40 miles per gallon. With the polar bears and penguins in deep trouble, this is the year Congress will finally do something."
The Bush administration proposed raising fuel economy standards by an average of four percent annually starting in September 2009 for passenger cars and September 2011 for light trucks in order to limit gasoline usage by five percent annually in 2017, or 8.5 billion gallons every year.
About the Author
Anthony Fontanelle is a 35-year-old automotive buff who grew up in the Windy City. He does freelance work for an automotive magazine when he is not busy customizing cars in his shop.