GM and others rally against new fuel efficiency standards

Posted Jun 22nd 2007 11:01AM by Brian White
Filed under: Products and Services, Law, Ford Motor (F), General Motors (GM)

With the passage of a new energy bill that requires a drastic increase in the average fuel efficiency of automobiles sold in the U.S., automakers are feeling a bit steamed right now. Mandating significant increases in gas efficiency for vehicles even within a little more than a decade is an enormous task for automakers. New designs, manufacturing processes and probably a hundred more things become necessary.

At the same time, the financial pressure the big three automakers are under make large changes like this hard to swallow. But this doesn't only affect domestic manufacturers ---- all automakers selling vehicles in the U.S. have to conform. The trick is that other automakers like Honda and Toyota started reacting to the market's need for more fuel-efficient cars (and the marketing of them) long before domestic automakers did. Now, those automakers are sitting in a much prettier setting than General Motors (NYSE:GM) or the Ford Motor Co.(NYSE:F). It's estimated that the fuel economy changes mandated for the future will cost GM $40 billion alone. Yikes.

The just-passed energy bill required a fuel economy increase of about 40% (to 35 miles per gallon) by 2020 -- just over 12-and-a-half years from now. Is that even technically possible? Most global automakers, who are united on this front (with the curious absence of Nissan), say that this expectation is way out of whack. The bill was passed late last night in the U.S. Senate by a vote of 65-27, and a vote by the U.S. House is probably coming next week. President Bush also added his opinion, stating that Congress must be "realistic" about this kind of legislation, and that he opposes much of it (while still supporting alternative methods like ethanol use).

Tags: Energy Bill, EnergyBill, F, Ford Motor, FordMotor, Fuel efficiency, FuelEfficiency, General Motors, GeneralMotors, GM

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Reader Comments (Page 1 of 1)

6-22-2007 @ 11:37AM

kenhill03 said...

This mandate was long overdue! Ford want to end its pitiful sales, and doesn't have a clue? Tell their CEO to drive to his nearest dealership, look at the price of the F-150, and the fuel mileage it gets. Then he can drive to the nearest gas station! Do I want a V-8? Hell Yes! I'm an american male. Do I want to pay $3 a gallon for gas? Hell NO! I'm an american worker. I don't see how this is a bad thing for the UAW. Someone's got to do the refit for the plants to make this work. Instead of carping about how raising mileage standards is going to hurt workers, go to your management and carp to them about outsourcing your jobs overseas! I want to buy a Chevy Camaro when they come out in 2008 that will get the same mileage from Ethanol that it will get from gas, then I'll buy a crib full of sugar beets and make my own ethanol and tell the oil companies to SUCK IT!!!

6-22-2007 @ 12:29PM

jpdr1100 said...

Your dream of getting the same mileage on ethanol that you are getting on gasoline will ramain always that: a dream.
Ethanol contains less energy per gallon.

6-22-2007 @ 12:23PM

agavemail said...

The hangup seems to be that congress lumps cars, trucks, and SUV's together. I say call their bluff and target cars, SUV's, and light trucks only with this bill. Provide an addemdum later on for "non-light" trucks which may have a seperate clause for farm-use vehicles. But make damned sure that the carmakers can't scam their way into categorizing a car or SUV as a truck or farm vehicle the way Toyota did with its pickups a while back to get around the requirements.

6-22-2007 @ 12:34PM

jpdr1100 said...

Toyota didn't do anything that Detroit wasn't already doing. The whole move to minivans, and then to SUVs was simply Detroit's way of getting around the regulations governing fuel mileage in cars. They "gave up" the car market the Japanese and fled to trucks, which have higher profits. The Japanese were late in getting into trucks.
But Toyota's pickups are not classified any differently than are Ford's or Chevy's.

6-22-2007 @ 5:03PM

A D said...

The liars in Washington have done it again.

Do any of them have any experience in automotive engineering?

NONE!

But they can legislate gas milage.

Don't any of you agreeing with this lunacy they passed see what a load of bull it really is? Did they pass any restrictions of taxations upon industries that have enough money and influence to buy them off? Nope, just wrote legislation against industry that is fighting for it's life.

You have just witnessed more effects of who runs this nation and it's not the voter.

6-22-2007 @ 3:55PM

A D said...

Is there any wonder why the general public puts more faith in drug dealers than they do elected "representatives"?

Whatever happened to "of the people, for the people"? Now it's "to the people".

There is support for advancing technology and conservation. Too bad thie legislation does none of that and instead will beyond any doubt cost more Americans their jobs.

American markets are suppposed to be free, too bad Washington has a price and it's obviuos who wns the entire town.

6-22-2007 @ 7:15PM

Tom Arcy said...

It's about time. The model "T" to my understanding got 25 mpg. If the Foreign car mfg's can get it why can't we. Hy-brid or bust. Do I really need 0-60 in 5 seconds, hell no. Do I really need lots of horse power to drive to work, hell no, do I need to save money, hell yes. The Big car dealers got themselves in a ringer when they invested in building engine plants for big engine's now they are trying to crame them down the mouth and make you believe everyone wants them. Now they are drowing in there own ego and not willing to change. Look at Honda, Suburau, as well as many other foreign cars. Most of their cars are 4 cylinders get great gas mileage and they offer more Hy-brids. Toyota has at least 4 models of Hy-brids. Ford has one. Two if you include Mercuery. I guess they are smarter than us. Going to American Universities and beating us at our own game.

tom