Wednesday 05 December 2007
Compromise bill includes safeguards for US auto manufacturing jobs.
The UAW "strongly supports" new fuel economy provisions in energy legislation being considered by Congress, UAW President Ron Gettelfinger said today.
"The UAW strongly supports this historic bill, which contains aggressive but still achievable fuel economy requirements," said Gettelfinger. "It will help consumers and the environment, and at the same time protect U.S. jobs."
The new provisions on corporate average fuel economy (CAFE) require significant increases in the fuel economy standards for passenger cars and light trucks. By 2020 the average fuel economy for all cars and light trucks will have to achieve an average of 35 miles per gallon for the entire industry. This will guarantee substantial savings in gas consumption, thereby enhancing U.S. energy security and reducing greenhouse gas emissions.
"There are no off ramps or other gimmicks," said Gettelfinger of the compromise legislation. "The new rule cannot be gamed to avoid the higher requirements."
At the same time, Gettelfinger said, the new CAFE standards contain key features which were strongly supported by UAW members and their families during the discussions that led to the compromise legislation. These include:
- Strong anti-backsliding language to require automakers to produce smaller, more fuel-efficient vehicles in the United States. This will protect the jobs of tens of thousands of American workers who assemble and produce parts for these vehicles.
- A continuation of the distinction between passenger cars and light trucks in the CAFE program. Requiring different rules for these different types of vehicles will ensure that light truck production and jobs are not adversely impacted by the new rules.
- An extension and then gradual phaseout of flex-fuel credits under the CAFE program. This will continue the incentive for auto companies to produce these vehicles, while helping moderate the transition to tougher fuel economy standards.
- Assistance to auto manufacturers for retooling facilities to produce hybrid and advanced diesel vehicles and their key components. This will accelerate the introduction of these more fuel-efficient vehicles, while helping ensure that cars and trucks of the future are built in this country, creating jobs for American workers.
Gettelfinger applauded House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid, along with House Energy and Commerce Committee Chair John Dingell, D- Mich.; Senate Energy and Natural Resources Committee Chair Jeff Bingaman, D-N.M., and Senate Commerce, Science and Transportation Chair Daniel Inouye D-Hawaii, for their role in crafting the new CAFE provisions.
"These legislative leaders were able to achieve a historic breakthrough on CAFE legislation because they listened to members of our union," said Gettelfinger. "UAW members want to save fuel and protect the environment - and we also want to preserve good-paying U.S. manufacturing jobs. The new CAFE rules accomplish all of these objectives."
Gettelfinger also praised a number of other legislators instrumental in developing the new fuel economy rules, including Reps. Baron Hill, D-Ind.; Carolyn Cheeks Kilpatrick, D-Mich.; John Salazar, D-Colo., and Mike Ross, D-Ark., and Sens. Carl Levin and Debbie Stabenow, Democrats of Michigan; Mark Pryor, D-Ark.; Claire McCaskill, D-Mo., and Russ Feingold, D-Wis.
Carmakers Unite, in the End, Over US Fuel Economy Rule
By Micheline Maynard
International Herald Tribune
Friday 07 December 2007
Detroit - Just six months ago, an auto industry trade group warned that consumers could be forced to buy vehicles they did not want if the U.S. Congress went too far in raising fuel economy standards.
But in the past week, after a deal on proposed legislation to raise fuel economy by 40 percent to 35 miles per gallon, or 6.7 liters per 100 kilometers, by 2020, the companies in the Alliance of Automobile Manufacturers declared the higher standards would be "good for both customers and energy security."
The reversal was more than a simple matter of the carmakers' accepting the inevitable. Despite the all-for-one, one-for-all sound of the alliance's new stand, the industry has in fact been divided in its response to growing calls to produce more efficient vehicles.
Nissan and Honda, for example, bought in early to the idea of higher fuel economy. They did not join the alliance, which includes Detroit, German and other Japanese car companies, which fought bigger increases until it was clear they would lose.
In return for its early support, Nissan preserved a unique exemption that makes it easier to meet current fuel economy standards.
"We're not whiners," Dominique Thormann, a senior vice president at Nissan North America, said in Washington during a lunch with reporters Wednesday, in a thinly veiled jab at competitors that originally fought fuel economy increases.
"We never went into this with the intention of challenging what the objective was," Thormann said. "Tell us where we need to get to. We'll get our engineers cranking."
Representative John Dingell, a Democrat of Michigan, did not share his view.
"This is not a bill I, or the members of the Committee on Energy and Commerce, would have written if we had been permitted to follow regular order," said Dingell, the committee's chairman.
He was referring to tough negotiations with the House speaker, Nancy Pelosi, before Thursday, when the House of Representatives easily passed energy legislation, which contained the fuel economy increase, by a vote of 235-181. The measure now goes back to the Senate, which passed a similar bill in June.
Dingell, who has been an advocate of his state's main industry for three decades, told the auto companies months ago that an increase was politically unstoppable. He said he could support the bill for several reasons, including provisions that would "help American factories retool to build the cars and trucks of the future."
His efforts for a more modest increase were overwhelmed by the determination of Pelosi and other members of Congress, who maintained that they had the public's support for higher fuel standards, to make carmakers contribute to efforts to fight climate change.
The months-long process has created some awkward moments for Detroit companies and their allies.
Last May, before the Senate action, the auto alliance ran newspaper and radio ads urging passage of a smaller increase in fuel economy.
Automakers currently must attain fuel mileage of 27.5 miles a gallon for cars and 22.2 miles a gallon for light trucks, including minivans, sport utilities and pickups for their corporate average fuel economy, known as CAFE.
"Extreme, unrealistic CAFE increases could force manufacturers into offering vehicles for sale that do not match up with consumer demand for versatility, performance, affordability, and passenger and cargo space," David McCurdy, the group's president, said May 14.
"If higher standards make vehicles less attractive to consumers, vehicle sales will drop, negatively impacting auto dealers, suppliers, automakers and the U.S. economy," McCurdy said.
But a week ago Friday, after Dingell and Pelosi reached a deal on a fuel economy measure in the House, the alliance said, "We believe this tough, national fuel economy bill will be good for both consumers and energy security. We support its passage."
Despite this suggestion of blanket support, Detroit-friendly lawmakers were still maneuvering to secure protections in the bill for the hometown business.
One provision in the House bill, backed by Senator Debbie Stabenow, a Democrat of Michigan, and supported by the United Automobile Workers union, provides U.S. government loan guarantees to help auto companies that invest in factories that are at least 20 years old to build vehicles with advanced technology.
That would specifically aid General Motors, which plans to build a new plug-in hybrid, the Chevrolet Volt, at a Detroit factory that opened in the early 1980s, making it eligible for the government-backed loan program.
Rick Wagoner, chief executive of GM, said Nov. 30 that his automaker was "prepared to put forth its best effort to meet" the higher fuel standards.
Lobbying against the higher standards also risked undermining the efforts of the auto companies to persuade consumers that their fleets are already fuel-efficient and that the automakers have more-efficient vehicles coming.
GM, for example, has been promoting the 23 vehicles in its lineup that achieve 30 miles a gallon or better. For GM, in particular, the Volt and other fuel-efficient cars can be its ticket back to dominating the American industry, said Daniel Becker, a former official with the Sierra Club who is now an environmental consultant.
"They can do it. They've got the best engineers in the world," Becker said. "This is auto mechanics, not rocket science. They should be able to take advantage of this bill to become the major force in the industry that they used to be."
David Cole, chairman of the Center for Automotive Research in Ann Arbor, Michigan, said, "You're going to see people trying to kill each other over how green they can be."
GM's environmental effort, in part, is a response to Toyota, which has been selling its hybrid-electric Prius in the United States since 2000. Toyota, however, did not emerge from the fuel economy debate unscathed.
Its participation in the alliance made it the target of criticism from environmental groups that had previously praised its efforts to build cleaner vehicles. Even before Toyota's stand on the legislation, the groups were angry about the introduction of its big Tundra pickup.
Indeed, Toyota executives said in the past week that the company felt that it was taking heat for the entire industry. Toyota's involvement, however, helped it avoid protectionist pressure it might have felt when it passed Ford this year to become the No. 2 carmaker in the United States, behind GM. Indeed, Toyota's Japanese imports have risen in 2007, largely because of the Prius, which is built only in Japan.
On Monday, Toyota's top American official, James Lentz, president of Toyota Motor Sales USA, said it was time for Congress to pass a higher fuel economy standard.
"Automakers - and the country - need the certainty of one national plan to guide the considerable additional investments necessary to move forward," Lentz said.
He added: "Without a united industry willing to take on a major fuel economy challenge for the good of the nation, this agreement may never have come to pass."
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John M. Broder contributed reporting from Washington, and Nick Bunkley contributed from Detroit.
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