Automakers Tell House to Lay Off On Fuel Economy
Thursday, March 15, 2007
Auto industry leaders and the United Auto Workers yesterday put up a united front in opposition to congressionally mandated improvements in vehicle fuel economy, potentially complicating the ambitions of Democrats seeking the most extensive changes in the rules since the 1970s.
Auto executives appearing at a House hearing not only rejected tough rules sought by Democrats and environmentalists, but also opposed a Bush administration proposal to improve mileage by 4 percent a year over the next 10 years.
"It's time to move away from proposals that don't solve the problem," said G. Richard Wagoner Jr., chief executive of General Motors.
Wagoner questioned the role of fuel-economy rules in reducing greenhouse gases or oil consumption since mandates were implemented in the mid-1970s.
The automakers favor allowing the National Highway Traffic Safety Administration to oversee creation of any new vehicle mileage rules, which would effectively take authority away from Congress. Some Democrats and environmental groups fear that NHTSA's rulemaking process, which includes taking into account the impact of regulations on industry, could give automakers an opportunity to water down any changes. Democrats want a law to bind automakers to higher standards.
The auto executives said they supported a "cap-and-trade" system to curb carbon dioxide emissions that would apply to every sector of the economy.
Wagoner was joined at the House Energy and Commerce subcommittee on energy and air quality hearing by Alan R. Mulally of Ford, Tom LaSorda of DaimlerChrysler's Chrysler Group, James E. Press of Toyota and Ronald A. Gettelfinger of the United Auto Workers.
The auto industry is prepared to fight over fuel-economy regulation. Its lobbyists include veterans of past fuel-economy fights. The industry also has thousands of dealers around the country who can be called upon to contact members of Congress or visit Capitol Hill. The UAW can unleash its members to press the industry's case.
Gettelfinger said stringent increases in fuel-economy standards could lead to a "calamitous result" of factory closings, tens of thousands of layoffs and the loss of retiree health care, already a primary target of industry cost-cutters. Improving vehicle gas mileage could cost as much as $44 billion at GM alone, Wagoner said.
Union workers have mobilized in the past to help kill fuel-economy proposals. UAW leaders hope for help from the Congressional Black Caucus, which is headed by Rep. Carolyn Cheeks Kilpatrick, a Democrat who represents a Detroit district.
At yesterday's hearing, the reach of the auto companies was clear. Rep. Tammy Baldwin (D-Wis.), who spoke last week of the urgency to "push the envelope" and press the auto executives "beyond their comfort area," talked yesterday about GM's truck plant in Janesville, Wis. The Janesville assembly plant is not in Baldwin's district, but it is "just next door," and she said many of its 2,600 employees live in her district.
She questioned automakers on how to curb carbon emissions at production facilities rather than from vehicle tailpipes. Environmentalists say tailpipe emissions account for the vast majority of the global warming emissions attributable to the auto industry.
Industry officials in Washington also noted the presence of Press, the Toyota executive, at the hearing. The fast-growing Japanese automaker is popular with many lawmakers. Last month, Toyota decided to build a $1.3 billion plant near Tupelo, Miss. Sen. Trent Lott (R-Miss.) promised to be a "warrior" on Toyota's behalf. At yesterday's hearing, Rep. Charles W. "Chip" Pickering Jr. (R-Miss.) referred to Press as "Tupelo honey."
Toyota is seen by many as the automaker most successful in creating an image of environmental sensitivity and social responsibility. Press said Toyota accepted the scientific consensus that global warming is occurring and that the industry has a responsibility help solve the problem. He said Toyota supported giving NHTSA the authority to set new fuel-economy rules.
The hearing came as other lawmakers were signing on to support tougher fuel-economy rules. Sens. Larry E. Craig (R-Idaho) and Byron L. Dorgan (D-N.D.) introduced a bill to improve fuel efficiency and increase oil production in the Gulf of Mexico. They said polls indicate that 75 percent of Americans support legislation that includes improved fuel-economy rules and more drilling.
David Friedman, research director of the clean vehicles program at the Union of Concerned Scientists, said auto executives were trying to shift responsibility from their products to the oil industry.
"What we learned today is that auto industry is very good at coming up with creative ways to avoid increasing the fuel economy of their cars and trucks," Friedman said. "They are trying to play the game at pointing the finger at someone else. And yet the fuel economy of cars and trucks is a disgrace."