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Skepticism over Bush’s fuel saving plan

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March 1, 2007

By JOHN CRAWLEY

Influential members of Congress expressed doubt on Wednesday about the White House goal of raising auto fuel efficiency by 4 percent next decade, convinced the target would harm U.S. manufacturers.

Rep. John Dingell, a Michigan Democrat and chairman of the House of Representatives Energy and Commerce Committee, suggested change is inevitable but he is not sold on the White House approach for saving 8.5 billions of gasoline by 2017.

“We have a target but we don’t know how we’re going to get there,” Dingell said after skewering the Bush administration initiative at an Energy and Commerce subcommittee hearing.

Administration officials acknowledged after sharp questioning by Dingell that much of the data for their proposal for passenger vehicles is rough or old, and little in-house study has been done.

The administration has stressed that the 4 percent threshold beginning in 2010 is merely a goal outlined by President George W. Bush. Its legislative proposal did not include a savings target, pending further analysis.

Nevertheless, Dingell’s skepticism was matched by other panel members, notably those whose districts or states include financially struggling U.S.-based automakers General Motors Corp., Ford Motor Co. and Chrysler Group, a unit of DaimlerChrysler AG.

“We need to seriously look at the impact of this proposal on the U.S. automotive economy,” said Rep. Fred Upton, a Michigan Republican.

“While reforms could be productive, I believe the proposed four percent rate of increase in the standard is not reasonable without a huge cost on such a short time line,” Upton said.

Big domestic and foreign-based automakers are resigned to changes in fuel economy but agree that a 4 percent hike would be painful. They also want the Republican-led administration to determine any increase, not the Democratic-led Congress.

Auto chief executives are expected to testify before the Energy and Commerce subcommittee in the coming weeks.

Edward Lazear, chairman of the White House Council of Economic Advisers, told the subcommittee the administration did not want to punish automakers. Nicole Nason, the administrator of the Transportation Department agency that determines fuel standards, said jeopardizing the manufacturing base “would be something we absolutely want to avoid.”

Nason said, however, some automakers may have to do more to comply than others to meet a 4 percent increase, a step that could also force changes in the fleet composition. “We would expect to see greater penetration for (gas-electric) hybrids and diesels,” she said.

Nason said her agency, the National Highway Traffic Safety Administration, would raise the standard by a practical amount and appealed to Congress not to mandate a target.

She has sought product plans from industry but has not yet analyzed what a 4 percent increase would cost. However, Nason disputed Upton’s estimated industry price tag of $100 billion — $40 billion for GM but far less for Japan’s Toyota Motor Corp. and Honda Motor Co..

Nason wants authority from Congress to overhaul how fuel savings are calculated for sedans, compacts, wagons and other passenger cars. Lawmakers have already granted NHTSA similar authority for the light truck class, moving from a fleet-based average to a formula based on vehicle size and weight.

Light trucks, including sport utilities, pickups and vans, must average 24.1 miles per gallon by 2011. Their mileage goal would rise under the White House proposal. Passenger cars currently must get 27.5 mpg, a standard unchanged for years.

Copyright © 2007 Reuters Limited

5 Responses to Skepticism over Bush’s fuel saving plan

  1. Ray

    March 1, 2007 at 4:04 pm

    It is strange that over the years once in while a news article mentions of a private inventor who had deveoped a carburator that would get 50 miles per gallon or more. There would be technical data and pictures of the man and his four ton Cadillac with the funny contraption on top of the engine. But every time this occurred, the inventor was bought out, went missing, or just never again mentioned. Odd at best. Big Oil likes to sell Gasoline. Who made the biggest profits last year? Exxon! Who was second? was it an oil company?

  2. Joe Lawrence

    March 1, 2007 at 7:21 pm

    It is curious to hear, from those on high, the number of things which “…harm U.S. manufacturers,” no?

    Here’s a partial listing, just off the top of my head:

    Environmental regulation. Increases in the minimum wage. Raising the CAFE standards. Unionization. Any single-payor healt care plan. Paper-trail voting machines. Failure to eliminate medical and/’or legal malpractice suits – unless the plaintiff is a U.S. Senator. Researching alternative energy sources. Dissing Wal-Mart. Auditing Halliburton. Requiring appropriate armor for our troops or, even, requiring the same level of protection for them as that accorded visiting dignitaries. Product liability responsibility.

    I know, I know….I’m supporting the terrorists.

  3. JimZ

    March 1, 2007 at 8:37 pm

    Joe Lawrence – you seem to have “unwittingly” stated most of the whole GOP platform (!).

    The only things you left out were:

    1. Create a despotic leadership that will be nearly impossible to get rid of.

    2. Spy on ALL Americans for no good reason.

    3. Promote offensive illegal wars of aggression and empire as “self-defense”

    4. Label all critics/criticism as “unpatriotic”.

    5. NEVER tell the truth about anything. Truth is for wussies AND terrorist-lovers.

    6. Have available pre-conceived plans that can be pulled out and used ambiguously as the wrong solution for the wrong problem per convenience (like using hurricane Katrina as the excuse to gut Posse Comitatis).

    Back to the article. It is hard to take any of this seriously, as we have heard all of this before, and there’s no penalties for non-compliance. Plus, how can some modest fuel-efficiency standards impact business? I’d think a large segment of Americans would buy a car just because of these standards.

    If American auto manufacturers want to survive, they’ve got to provide products consumers actually WANT, and stop blaming everything but their own obese management for their failures.

    Get off your high horse and run the frickin’ business instead of fighting legislation. Gee surprise, after all your big discounting over the last 2 years you are now in financial trouble. Does it take a non-business guy like me to tell YOU that?

  4. JimZ

    March 1, 2007 at 9:01 pm

    Ooops, forgot blame Bill Clinton at every opportunity. Use the excuse that “Clinton did it” to justify anything you want as if HE did it, then it’s OK, while blaming HIM for doing IT in the first place!

  5. David Rosenberg

    March 2, 2007 at 7:25 pm

    In this case it depends what you’re going to blame Clinton for. Before he left office, he put through almost the same proposals bush asks for. It was bush, when he took office, threw those proposals out, along with every other environmental goal Clinton made.

    It is no secret of the many fuel saving inventions that have been lost and forgotten over the years. Instead of using these gas saving gadgets, the Auto makers put the ball back into the lap of the car owner. Don’t mash down on the gas pedel, keep your Tires at the proper psi, keep the auto tuned up, drive a posted MPH, do all your shopping at one time, don’t add any wind resistence items to the outside of the car and my favorite, only drive when you need to. If you follow all of the above, you can save up to a GALLON of gas, maybe.

    I can remember when owning a car, was considered a luxury, it’s more of a responsibility today.