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January 14, 2011

Auto Industry Flip-Flops on Fuel Efficiency, Oil Savings

Traffic2 This week, GM vice chairman of global product operations Tom Stephens said customers will be able to choose from an array of small vehicles across its brands when gas prices hit $4 a gallon -- something they weren't able to do in 2007 and 2008,.

"The last time it spiked up, we didn't really have a complete, full-line portfolio," Stephens said on the sidelines of the Detroit auto show. "What we were missing the most were small and compact cars. We were really in a bad way there."

While this is good news from a company we spent $50 billion bailing out, the real reason GM is ready is because of California.

California led the nation with the first ever global warming pollution standards for new cars and light trucks. California's standards, which 14 other states adopted, were based on the very important fact that cost effective technology existed to drive down pollution and drive up fuel efficiency of our new cars, while also saving consumers billions at the pump.  

These standards set the bar for the standards the Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) finalized in April 2010, putting fuel economy on a path to 34 mpg and setting a national global warming pollution standard for vehicles.

But sadly that's not the full story. Just when we might have thought you can teach an old dog new tricks - the auto industry proves us wrong.

It did not take long for the auto industry to revert back to old ways once the new Congress was sworn in. The image of constructive engagement with the Administration's (and California's) on-going effort to pull vehicle fuel economy and technology out of the last century shifted quickly.

The gloves are off and the industry is on the offense. In its January 11, 2011, letter to Chairman Fred Upton (yes from Michigan), the Alliance of Automobile Manufacturers complains bitterly about EPA's and NHTSA's process for raising fuel economy and global warming pollution standards for vehicles that will be sold in model years 2017-2015 while also rehashing the already decided issue of California's authority to set vehicle global warming pollution standards using its unique authority under the Clean Air Act.  

While the Alliance knows it can't argue for no increase in standards and says it is "committed to working constructively with EPA and NHTSA - and California..." to develop new standards, the message from them is clear: EPA and NHTSA should do as little as possible because doing more will cost too much. We all know where the do-nothing approach landed us - an auto industry rescued with billions of dollars of tax payer bailouts and a nation deeply addicted to oil.  

The Alliance should remember standards are what allow GM to brag that it has the vehicles ready to compete when gas prices hit $4 per gallon. EPA, NHTSA and California are doing an exhaustive assessment of costs to drown out the industry's tired bark about inflated costs of putting technology onto the vehicles they sell.

Let's remember - the standards President Obama's EPA and NHTSA issued last April will save 1.8 billion barrels of oil, keep 960 million metric tons of global warming pollution out of the atmosphere and - one more thing - save consumers $240 billion at the gas pump. 

--Ann Mesnikoff, Director of the Sierra Club Green Transportation Campaign

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