WASHINGTON – Faced with almost certain defeat on fuel economy in Congress, automakers and their allies have decided to join proponents of sharply higher standards and declare victory.
The industry issued statements over the weekend in favor of a 35-mpg fleet-wide national average by 2020 – about 40 percent higher than today. The statements followed announcements Friday night by top congressional Democrats vowing to soon pass an energy bill containing a 35-mpg standard.
For most of this year, many industry leaders argued that such a plan was too aggressive. They warned of serious consequences for automakers, suppliers, workers, dealers and consumers.
But top industry lobbyist Dave McCurdy said in a Saturday statement that the pending legislation will be good for both consumers and energy security. We support its passage.
He is president of the Alliance of Automobile Manufacturers, which represents the Detroit 3, Toyota and five other automakers.
General Motors CEO Rick Wagoner called the pending legislation a challenge that GM is prepared to put forth its best effort to meet.
Josephine Cooper, group vice president for government and industry affairs at Toyota Motor North America Inc., said her company applauds congressional leaders for this very important step toward establishing new, aggressive nationwide fuel economy standards.
Mike Stanton, president of the Association of International Automobile Manufacturers, said in early November that his members had stopped fighting a 35-mpg standard. Members are Toyota, Honda, Nissan, Hyundai and 10 others.
A top industry ally in Congress, Rep. John Dingell, D-Mich., said the pending legislation would provide critical environmental safeguards without jeopardizing American jobs. He is chairman of the powerful House Energy and Commerce Committee.
Previously, he had said the 30-year-old corporate average fuel economy program, or CAFE, was outmoded, and that tougher requirements for automakers ought to be part of broader limits on greenhouse gases from utilities, refiners and other emitters. The principal gas is carbon dioxide, a byproduct of burning fuel.
But Rep. Edward Markey, D-Mass., a leading House proponent of sharply higher CAFE standards, said the 35-mpg standard for vehicles will be enacted because House Speaker Nancy Pelosi, D-Calif., was so stalwart for it.
Having failed to get much traction on alternatives, Dingell went toe to toe in recent weeks with Pelosi and other lawmakers to alter some provisions of Senate-passed energy legislation that included a 35 mpg standard.
He and his allies won some changes that will save autoworker jobs and provide automakers with flexibility they need, Dingell said.
But a senior congressional staffer close to the behind-the-scenes negotiations said the only significant concession to the Detroit 3 will be temporary continuation of CAFE credits for building vehicles capable of burning alternative fuels. The main one is E85, which is 85 percent ethanol and 15 percent gasoline.
Other changes reportedly will let an automaker trade CAFE credits between its car and truck fleets and will authorize some funding to help automakers convert plants for building more fuel-efficient vehicles.
In some ways, the final bill is even tougher than what the Senate passed in June over strong industry objections, said the staffer, who would speak about the talks only if granted anonymity.
Still unresolved are other big fuel economy questions facing the industry. They include how to make upcoming federal greenhouse gas rules compatible with the CAFE program and whether California and other states will be able to enforce their own greenhouse gas rules.