California's CO2 Plan Worries Automakers

In the meantime, the auto industry has been devouring a draft version of the regulation released last month. The proposal, nearly 200 pages long, says manufacturers can achieve the reductions using currently available technologies, such as turbochargers to make smaller engines more powerful, making car bodies more aerodynamic and offering more gas-electric hybrid vehicles such as the Toyota Prius.

Carmakers say the conclusions are unrealistic. "There is a huge gap between what can feasibly be accomplished today and what the staff draft has proposed," said Dave Barthmuss, a spokesman for General Motors. "It would essentially mandate that multiple technologies be put on every California vehicle, which would dramatically increase cost and we believe dramatically reduce choice" for consumers.

And because of the size of the California marketplace, "I suspect the changes would have to be implemented on a much broader scale to make [economic] sense," Cabaniss said. "It goes to the heart of not just the engine or transmission, but the complete design of the vehicle and the materials used. It could eventually touch essentially everything about the design of a motor vehicle."

U.S.-based car companies would find it harder to meet such demands than their overseas competitors. Detroit's Big Three make virtually all their profits on the biggest, most fuel-consuming trucks and SUVs, which would be the hardest-hit by California's proposed regulation. Japanese rivals Honda and Toyota can better absorb the costs through higher overall profit margins and have a head-start on hybrid and other technologies that could help meet the stricter standards.

But Cabaniss argued that California regulators have failed to show that cutting carbon dioxide would help the environment enough to justify such drastic changes. "This is a global climate issue -- not California, and not U.S. It's clearly not going to have a great effect," Cabaniss said.

Automakers delivered similar warnings at a workshop with California Air Resources Board staffers earlier this month, which a board spokesman said was the first significant input from industry.

"The auto companies have not participated very well," board spokesman Jerry Martin said. "They have been very candid in saying they intend to file lawsuits, so they don't want to be participating in any of the rule-making process. . . . That hurt us because they are the experts at building cars. We need that interplay from them."

He said the board still hopes it can work with industry to avoid fighting the matter in court. The input from automakers at the recent workshop was "a big step forward," Martin said. "Hopefully that gridlock is beginning to break."