Tag: CAFE standards

NAM Questions Future CAFE Standards

Recently, the National Association of Manufacturers (NAM) set a letter Secretary LaHood and Administrator Jackson concerning the future CAFE standards proposed for 2017-2025. The NAM is concerned that recent proposals are simply unattainable and unrealistic.

Strong standards have already been set for 2012-2016, which raise the fleet average to 35 miles per gallon. While the NAM is supportive of reasonable standards to improve fuel efficiency, setting unrealistic goals will only increase the cost of doing business here, limiting consumer options, costing jobs and increasing vehicle prices.

Moving forward, it is important that the Environmental Protection Agency (EPA) and the Department of Transportation (DOT) are pragmatic in their approach, ensuring they are not establishing regulations that require manufactures to speculate what technologies might be available in 2024!

These proposed CAFE standards must be based on current science. It is thought by many that DOT and EPA will propose a standard of 56.5. If this is accurate then clearly these standards will not have been based on science but rather on something else.  It is critical that in proposing new fuel standards, the EPA and DOT make sure that America continues its tradition of a robust manufacturing market for automobiles that help grow our economy and protect jobs.

Chip Yost is vice president for energy resources policy, National Association of Manufacturers

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Preemption, How Times Change…Quickly

On Tuesday President Obama led a White House event hailing the adoption of a national standard on fuel efficiency. From the transcript:

The goal is to set one national standard that will rapidly increase fuel efficiency — without compromising safety — by an average of 5 percent each year between 2012 and 2016, building on the 2011 standard my administration set shortly after taking office.

A series of major lawsuits will be dropped in support of this new national standard.

On Wednesday, President Obama issued a memo to the Executive Branch agencies announcing his Administration’s opposition to a national standard for the regulation of products. We predict: A series of major lawsuits will be drummed up as a result of this new, 50-state, inconsistent standard.

Is that what commentators mean by pragmatic?

UPDATE (10:35 a.m.): From BusinessWeek, “Obama Regulatory Review Could Spur Product Lawsuits

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What Election?

California Governor Arnold Schwarzenegger flies across country to participate in the White House’s event marking a new agreement on vehicle fuel standards. Now, it’s certainly true that California and the Governor’s relentless push for more regulation helped lead us to this point.

But it sure looks like the governor decided to get out of town before the voters destroy the proposed tax increases he supports at the polls today.

How did California get to such a state of economically wretched affairs?

UPDATE (12:15 p.m.): Heritage has some ideas.

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Feds Working at Cross Purposes to Save/Damage Auto Industry

From the Detroit Free Press, “Obama can do better in helping autos, Engler says,” a story from just a few comments following a speech.

Former Gov. John Engler is worried that President Barack Obama’s administration is working at cross purposes when it comes to the domestic auto industry.

While Obama’s auto task force is working on ways to save the domestic auto industry, “the Environmental Protection Agency is meeting in a different building to figure out ways to decimate the industry” by allowing different fuel emission standards for every state, Engler said.

“There’s even a county in New Mexico that wants its own standards,” he said.

As president and CEO of the National Association of Manufacturers, Engler said that while bankruptcy is front and center of the federal discussions, “I don’t think they’ve factored in the consequences of that and what it will do to tier one and tier two suppliers. There will be a lot of damage done.”

Seriously, Bernalillo County wanted its own fuel-efficiency standards as a way to limit carbon dioxide emissions. Thankfully, reality may have started sinking in. From the National Automobile Dealers Association, “County in New Mexico Halts Effort to Implement its Own Fuel Economy Rules“:

WASHINGTON (Feb. 17, 2009) – The National Automobile Dealers Association (NADA) today commended the Albuquerque-Bernalillo County Air Quality Control Board in New Mexico for repealing a requirement that would have mandated fuel economy standards at the local level.

“The Albuquerque case illustrates how easily the ‘patchwork’ approach to fuel economy can get out of hand,” said John McEleney, NADA chairman and a multi-franchise dealer in Iowa. “If it weren’t for litigation filed by New Mexico dealers and NADA, the city of Albuquerque would still be pressing forward.”

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As California’s Economy Goes, So Goes the U.S.

From Henry Payne, writing at Planet Gore, “California’s Deal with EPA: Watch Your Wallets!”:

Detroit, Mich. — An environmental watchdog group reported Monday that California and EPA have reached agreement in principle that auto fuel-economy rules will be set by the federal government — but according to California’s proposed regulations. The resulting hike over already-onerous federal rules, say industry analysts, could cost U.S. automakers billions more in regulatory compliance at a time when they are already financially insolvent.

“EPA is likely to follow historical precedent and federalize the state rules,” reports InsideEPA.com, thus resolving “the long-running fight over the state’s request for EPA to grant a Clean Air Act waiver for greenhouse gas emissions standards while retaining industry’s preferred compliance mechanism under CAFE.”

They stared at the carcass, splayed out in the hot sun. The Californian nudged it with his foot, a tight smile on his face. The Fed looked at the dead, decaying economy, and a moment of doubt crossed his mind. “Oh, well,” he said to himself. “At least it’s a national standard.”

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Congress Weighs the Next Step on CAFE Standards

From Zippy the Pinhead, “Isetta, Therefore I Am.”

 

 

 

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At the EPA, a Focus on Something Other Than the Economy

The EPA today released its plan for reviewing California’s request for a waiver so the state can regulate tailpipe emissions. (News release.)

Here’s a statement from John P. McEleney, chairman of the National Automobile Dealers Association, in reaction to the EPA’s announcement:

It is apparent from its notice that EPA has all but made up its mind to allow for state-by-state fuel economy/greenhouse gas regulations, which is contrary to the President’s statement against a ‘confusing and patchwork set of standards that hurts the environment and the auto industry.’ The nation’s auto dealers instead urge EPA to have a fair and frank national debate over the California Air Resources Board’s (CARB) continued campaign to regulate fuel economy at the state level. We are confident that once all the facts are known, the Administration will decide that the best policy is to maintain a single, national fuel economy standard. The state-by-state patchwork approach, advocated by CARB, should be rejected once and for all. The California approach is riddled with exemptions, loopholes and unintended consequences that are counterproductive to the stated goals of advancing energy security and reducing greenhouse gas emissions.

From BNET, “Obama’s EPA Could Greenlight 40-Plus MPG Standard in Calif.”:

The Obama Administration’s Environmental Protection Agency signaled it will probably approve stricter standards for greenhouse gases from auto emissions in California.

The net effect would be to hike the average miles per gallon required for cars sold in California, to more than 40 mpg within about five years, according to the Association of International Automobile Manufacturers, an auto industry lobbying group. Proposed California standards for trucks wouldn’t be as stiff.

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At the Washington Auto Show, Getting Ready

The Washington Auto Show will be crowded the rest of the week, we assure you, but today is the media and policy access day, so there are quiet spots amid the news conferences.

So, what the heck. Here’s a statement made last week by Dave McCurdy, president and CEO of the Auto Alliance:

AUTOMAKERS URGE DEPARTMENT OF TRANSPORTATION TO FINALIZE FUEL ECONOMY STANDARDS THROUGH 2015

“In directing the Department of Transportation to set new fuel economy standards for MY 2011, President Obama promised a “sustained effort” to enhance energy security and reduce greenhouse gas emissions. We share those goals and are working to bring tomorrow’s fuel efficient vehicles to market.

The Alliance of Automobile Manufacturers also encourages the Department of Transportation (DOT) to finalize federal fuel economy standards through MY 2015 as soon as possible.

 To be successful, we need certainty and adequate lead time. The Department of Transportation has already done the analysis necessary finalize regulations through MY 2015. We urge Secretary LaHood to quickly review and publish these standards.

 The Alliance looks forward to working with Congress, the states and the administration to help bridge competing fuel economy proposals, set aggressive standards through 2015 and direct our efforts toward meeting a national standard of at least 35 miles per gallon by 2020.”

– Dave McCurdy, President and CEO

From the Alliance’s website, The Auto Minute.

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Throwing a Monkey Wrench into the Economy

The PBS show, Newshour, ran a useful segment last night on the Obama Administration’s signaled willingness to let states like California establish their own regulatory regime to control vehicle emissions. After the setup piece, moderator Ray Suarez interviewed Ian Bowles, the Massachusetts Secretary of Energy and Environment, and Mike Dushane, executive editor of Car and Driver.

Dushane was impressive and provided a valuable dose of “let’s get real” here, highlighting the technological and economic obstacles that make it difficult if not impossible for the auto manufacturers to develop a fleet of vehicles that meets California’s standards while producing cars that are also affordable and wanted by consumers.

From, “Obama Orders Regulators to Revisit Fuel Standards“:

MIKE DUSHANE, CarandDriver.com: Well, if there are different laws in different states, it’s going to create a very difficult situation for carmakers which, first of all, takes a long time to develop vehicles, and, second of all, save money by producing a uniform set of vehicles for the whole country.

But what I’m hearing here is that there’s all this technology that could be used by car companies and just isn’t. The reality is that that technology means vehicles will be smaller; they will be less powerful; they will be less safe; and they will be thousands of dollars more expensive for people living in those states where these rules may be adopted.

RAY SUAREZ: For a long time, California had different standards for automobiles registered in the states than other places in the country. Can we use that as a test case? Was a car in California more expensive?

MIKE DUSHANE: The differences were not nearly as dramatic as what we’re talking about now. We’re talking about, in six years, a 30 percent increase in economy standards. That is virtually unobtainable unless everyone starts buying compact cars with hybrid systems, meaning those cars are going to be small and they’re going to cost probably $4,000 more than comparable compact cars today, so get ready to buy a compact car for $25,000 in those states.

Followed by more regulations, subsidies and bailouts, in an ever circular pattern until we achieve full Lada implementation.

The contrast is striking between Dushane’s analysis, which is based on years of covering the automotive industry, and Bowles’ sloganeering, which appears based on ideology and hoping.

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State-by-State Regulation, the Costs and Consequences

The NAM issued a statement upon President Obama’s announcement that the EPA would review California’s request for waiver so it can establish its own regulations to control vehicle emissions. Keith McCoy, vice president for energy and resources policy, said:

Auto makers acted in good faith working with Congress and the previous administration to develop the tough new national fuel economy law for the next 12 years and beyond. As directed by the 2007 Energy Independence and Security Act (EISA), the National Highway Transportation Safety Administration is currently in the process of setting fuel economy standards that will result in a minimum of a 40 percent increase in fuel economy and a minimum 30 percent reduction in carbon dioxide emissions by 2020.

A separate waiver for California would lead to a patchwork of greenhouse gas reduction laws when climate change is a global issue and should be addressed on a national level.

Dave McCurdy, president and CEO of the Auto Alliance, representing domestic and foreign automakers with major U.S. presences, also issued a statement supporting federal standards.

“The Alliance supports a nationwide program that bridges state and federal concerns and moves all stakeholders forward, and we are ready to work with the Administration on developing a national approach.”

Since CA sought federal permission to set its own fuel economy/CO2 standards, there have been many developments. The U.S. Supreme Court directed EPA to reconsider greenhouse gas regulations for autos, the Congress passed stringent new fuel economy standards requiring CO2 reductions of at least 30%, automakers are offering more than 25 models of hybrids for sale in 2009, President Obama and a Democratic Senate and House are considering a comprehensive, economy-wide approach to CO2 reductions, and the credit crunch is producing the toughest marketplace since World War II.

Today in the U.S. there are three voices on fuel economy/CO2 — NHTSA, EPA and CA — and each has different standards, different structures and different timelines. Automakers seek a federal-state solution that provides us with compliance clarity and one national standard.

The Alliance also urges the Obama Administration to issue fuel economy standards for MY2011, because automakers are working on their product plans now and need the certainty of final standards.

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