July 2007
POLICY NEWS
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Fuel Economy Debate Continues
Two bills fuel discussion in the House
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After passage of the Senate energy bill last month that included requirements to increase fuel economy to 35 mpg by 2020, the focus now shifts to the House where things have already been heating up. Michigan's Rep. Dingell, who chairs the powerful House Energy and Commerce committee, has put off discussion of fuel economy legislation until the fall, but other representatives are pushing to bring CAFE standards to a vote sooner.
Representatives Markey and Platts, for example, have continued to push a bill (H.R. 1506) similar to the Senate's, requiring 35 mpg by 2018. One notable difference is that the bill includes a key provision requiring a minimum fuel economy level for both domestic and imported vehicles, thus helping to preserve small car production in the U.S. Representatives Hill and Terry have introduced their own bill (H.R. 2927), which sets a fuel economy target of 32 to 35 mpg by 2022. The UAW and the Alliance of Automobile Manufacturers, which represents the Big 3 and other major automakers, are supporting the Hill-Terry bill as "a more reasonable alternative." Lobbying on both sides has already geared up and promises to rival the battle held in the Senate.
The other leading proposal, introduced by Markey-Platts, requires stiffer fuel economy increases similar to the Senate, but offers limited tools to help the domestic companies achieve the standards. Neither proposal contains significant incentives to domestic automakers for retooling their factories to produce new fuel efficient vehicles and technologies.
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Stabenow Proposes Incentives for Automakers
Bond bill would finance $12B in auto plant renovations
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After passage of the Senate energy bill, Senator Stabenow (D-MI) is pushing legislation that would make achieving the new standards a little easier for the U.S. automakers. Her new bill would provide $12B in bond money for automakers to retool older auto plants. Stabenow claims that for every dollar spent, the bonds would leverage 10 times that amount on the market.
On the House side, Congressman Rogers (R-MI) continues to support his bill to provide $20B in loan guarantees for retooling existing plants to build advanced technology vehicles.
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Senate Passes Renewable Fuels Standards
Bill would require 20% renewable fuels by 2022 |
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In addition to new fuel economy standards, the energy bill that passed the Senate last month also included several measures for boosting renewable fuel use in the U.S. For example, the bill would establish a renewable fuels standard that requires approximately 20% of fuel sold in 2022 to be alternative fuels, and requires that 60% of those alternative fuels be advanced biofuels made from sources other than corn. Additionally, the bill also provides incentives for the production of next-generation biofuels, including grants, loans, and payments to farmers for growing new energy crops.
Read more: Renewable Fuels Standard
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U.S. Automakers Show Support for Carbon Reductions
GM, Ford and Chrysler join USCAP
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Ford and Chrysler recently joined GM as the only automakers to sign on to the U.S. Climate Action Partnership, a coalition of groups campaigning for mandatory reductions in greenhouse gas emissions. The U.S. automakers have long advocated for an economy-wide approach to carbon reductions, claiming that through fuel economy regulations they face a disproportionate responsibility for curbing greenhouse gas emissions. Rep. John Dingell has promised to develop an economy-wide approach to dealing with global warming later in the year.
Read more: Ford, Chrysler Join Climate Action Group
TECHNOLOGY NEWS
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Major U.S. Investments by Chrysler Group
Four new plants in the Midwest, other upgrades
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Chrysler Group is undertaking a "powertrain offensive" that is responsible for over $2B in investment thoughout the Midwest. The plan includes construction of two new advanced engines plants in WI and MI, a new advanced transmission plant in IN, and a new axle plant in MI. Altogether, these investments will create over 3,000 UAW organized jobs, and will be responsible for a 5 to 10% increase in the fuel economy of over a million vehicles annually. In addition, Chrysler also announced plans to broaden its hybrid plans, explore more diesel technologies, and improve the effciency of its most popular engines.
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