plan pushes automakers on mpg
By KEN THOMAS, Associated Press Writer
- The groundbreaking deal in Congress to raise mile-per-gallon standards will
compel the auto industry to churn out more fuel-efficient vehicles
on a faster timeline than the companies wanted, though with flexibility to get
the job done.
The auto industry's fleet of new cars, sport
utility vehicles, pickup trucks and vans will have to average 35
mpg by 2020, according to the agreement that congressional negotiators
announced late Friday. That compares with the 2008 requirement of 27.5 mpg
average for cars and 22.5 mpg for light trucks. It would be first increase
ordered by Congress in three decades.
Majority Democrats plan to include the requirement in broader energy
legislation to be debated in the context of $90-per-barrel oil, $3-plus pump
prices and growing concerns about climate change. The House plans to begin
debate this week.
"It is a major milestone and the first concrete legislation to
address global warming," said Sen.
Dianne Feinstein, D-Calif.
While Senate Democrats were quick to embrace the compromise, the energy
bill may face problems over requirements for nonpublic electric utilities to
produce 15 percent of their power from renewable energy sources such as wind or
Sen. Pete Domenici
R-N.M., on Saturday said that idea "will make this bill untenable for many
in the Senate."
Environmentalists have sought stricter mileage standards for years,
saying that is the most effective way to curb greenhouse gas emissions and oil
The energy bill will help accelerate plans by automakers to bring more fuel-efficient
technologies to conventional engines and alternatives such as gas-electric
hybrids and vehicles running on ethanol blends. For the first time, for
example, manufacturers will receive credits for building vehicles running on
Domestic automakers and Toyota Motor Corp. vehemently
opposed a Senate bill approved passed in June that contained the same mileage
requirements and timeline. They warned the measure would limit the choice of
vehicles, threaten jobs and drive up costs.
The companies backed an alternative of 32 mpg to 35 mpg by 2022. At the
LLC executive Tom LaSorda told employees the Senate bill would
"add up to a staggering $6,700 — almost a 40 percent increase
— to the cost of every Chrysler vehicle."
But the compromise worked out by Rep.
John Dingell, D-Mich., House Speaker Nancy Pelosi,
D-Calif., and Senate leaders, maintains a significant boost in mileage
standards while giving the industry more flexibility and certainty as they plan
The proposal would continue separate standards for cars and trucks,
extend credits for producing vehicles that run on ethanol blends, and allow
automakers to receive separate credits for exceeding the standards and then
apply those credits to other model years.
lawmakers secured an extension of the current 1.2 mpg credit for the production
of each "flexible fuel" vehicle, capable of running on ethanol blends
of 15 percent gasoline and 85 percent ethanol. Without the extension, the
credits may have run out by 2010, but under the deal, they will be phased out
The United Auto Workers union also won a provision intended to prevent
companies from shifting production of less profitable small cars to overseas
plants. At stake are an estimated 17,000 jobs.
The House's energy bill, approved in August, did not include mileage
standards, and lawmakers had worked since then to include them.
Rick Wagoner, General Motors Corp.'s
chairman and chief executive, said the new rules would "pose a significant
technical and economic challenge to the industry." He said GM would tackle
the changes "with an array of engineering, research and development
GM, Chrysler and Ford Motor Co.
have announced plans to double their production by 2010 of flex-fuel vehicles.
Toyota has said it will
bring the option to the Tundra pickup.
Among hybrids, Toyota
has dominated the market with the Prius, but several automakers are beginning
to bring the technology to large SUVs and pickups.
Environmental groups estimate the deal would save the country 1.2
million barrels of oil per day by 2020 while helping motorists save at the
"Cars are going to be more attractive to consumers because they
won't cost as much to own and operate," said David Doniger, director of
the climate center for the Natural Resources Defense Council.
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