"You've Lost" Detroit Chiefs Endure Scolding as They Argue Against Mileage Increase

[Ming]

Big Three Chiefs Endure Scolding as They Argue Against Mileage Increase in Washington
06-07-2007
www.edmunds.com

WASHINGTON, D.C. — During a joint appearance on Capitol Hill on Wednesday, the CEOs of Detroit's domestic automakers ran into a wall of criticism as they argued against Democratic proposals for tougher fuel economy requirements.

Congressional leaders scolded the auto executives about lost market share, closed plants and jobs lost to overseas manufacturers. Sen. Byron Dorgan (D-N.D.), told them the fight over increased mileage requirements for cars and light trucks is over and said, "You've lost."

"Frankly, it's time to move beyond exclusive reliance on historical regulatory approaches like corporate average fuel economy (CAFE) that clearly haven't solved these critical problems, and move forward to embrace solutions that will yield the results that Americans expect and deserve," said GM Chairman and CEO Rick Wagoner in remarks to the U.S. Senate Manufacturing Summit. Wagoner implored the lawmakers to help the industry address "the woeful shortfall" in E-85 distribution. "If market forces don't rapidly increase the number of fueling stations that offer E-85, then regulatory solutions will be needed," he added.

Source: http://www.edmunds.com/insideline/do...ticleId=121122

[camaro chris]

Damnit! Just Let The Fricken Free Market Demand Decide These Things!!!

[gwwyjjliu]

That was really dumb. Rick Wagoner et. al. should already know that they won't get a sympathetic ear in Washington. The "Big Three" (an outdated term, in my opinion) should have insisted that the US chiefs of Toyota, Honda, Nissan, and Hyundai also come and testify with them; otherwise, they are totally wasting their time.

What else would you expect from a Senator representing a state with no auto-related industry?

[Ming]

Originally Posted by camaro chris

Damnit! Just Let The Fricken Free Market Demand Decide These Things!!!

[Slideways]

Originally Posted by camaro chris

Damnit! Just Let The Fricken Free Market Demand Decide These Things!!!

That would make too much sense and wouldn't get any member of Congress reelected.

[mkwelbornjr]

Can't believe the gov is saying this. Its the gov's fault the big 3 have an unfair advantage in terms of healthcare. Maybe then they wouldn't have to close plants.

[TORRED1]

I agree let the markets decide, SUV's became popular because that is what people wanted, and gas was cheap. If you want people to use less gas then raise taxes on it till, till you see consumption drop, either thru the a fuel efficent car or reduction in their driving

[BrickTamland]

Toyota and Honda will probably follow CAFE increases without being prodded. They will be lauded for it.

Ford, GM, and Chrysler might also try keeping mum about the issue from now on and increase their average fuel economies. They would be lauded for that. At this point, they are just raising a stink that lessens their images in the eyes of many people who already do not have a good perception of the domestics. Adapting to Congressional measures is a great way to improve perception.

[69Firebird400]

Originally Posted by BrickTamland

Toyota and Honda will probably follow CAFE increases without being prodded. They will be lauded for it.

Ford, GM, and Chrysler might also try keeping mum about the issue from now on and increase their average fuel economies. They would be lauded for that. At this point, they are just raising a stink that lessens their images in the eyes of many people who already do not have a good perception of the domestics. Adapting to Congressional measures is a great way to improve perception.

I don't know about Honda (since they don't really sell trucks, and certainly not large, V8-powered ones like GM, Ford, Chrysler, and Toyota sell), but Toyota was definitely arm-in-arm with the other three big ones in opposition to increasing CAFE. They're members of the Alliance of Automobile Manufacturers, which is the group that has been lobbying against the CAFE changes.

The problem with sitting around quietly while laws are passed that directly affect their companies' success or failure is that by not opposing these rules, Congress might be inclined to throw a few other ones that there that are equally difficult to adhere to. They have to speak up if it's hurting them, IMO.

[Carman14]

The Big 3 have been arguing against CAFE's for, what, 50 years now? And they're in toilet now. They need to come up with some other argument. I kinda agree that their reasoning against it is getting kinda old. They should be trying to work something on health care in exchange for accepting the CAFE's.

[smk4565]

Free market should determine it more than the government. However, Detroit has messed up big time when it comes to gas mileage, and building cars people want.

[69Firebird400]

Well, it appears that the automakers have switched to the "winning" team on this issue - they now say they can reluctantly support a CAFE increase. Hmmmm...

Automakers warm to new U.S. fuel savings proposal

June 7, 2007 - 3:00 pm

Major automakers reluctantly said today that they could live with a proposal in the U.S. House of Representatives for stricter vehicle mileage standards although it would cause financial pain. The industry's major union, the United Auto Workers, endorsed the proposal.

Dave McCurdy told a House of Representatives hearing the proposed goals are "extremely aggressive" and would be difficult to achieve but he did not dismiss them. McCurdy is president of the Alliance of Automobile Manufacturers, which includes the Detroit 3, Toyota and five other automakers.

"The proposed increases in fuel economy requirements would present major technology challenges for automakers, requiring tremendous investments over a sustained period of time," McCurdy said.

The plan would require that new compacts, sedans and wagons boost fuel economy by 8.5 miles per gallon to 36 mpg by 2022. The standard for sport utilities, pickups and vans would rise by 7.8 mpg to 30 mpg by 2025.

http://www.reuters.com/article/ousiv...00709220070608

[fp115]

Originally Posted by Carman14

The Big 3 have been arguing against CAFE's for, what, 50 years now? And they're in toilet now. They need to come up with some other argument. I kinda agree that their reasoning against it is getting kinda old. They should be trying to work something on health care in exchange for accepting the CAFE's.

Which GM does, by providing the kids with Hummers. LOL

[BrickTamland]

Originally Posted by 69Firebird400

I don't know about Honda (since they don't really sell trucks, and certainly not large, V8-powered ones like GM, Ford, Chrysler, and Toyota sell), but Toyota was definitely arm-in-arm with the other three big ones in opposition to increasing CAFE. They're members of the Alliance of Automobile Manufacturers, which is the group that has been lobbying against the CAFE changes.

The problem with sitting around quietly while laws are passed that directly affect their companies' success or failure is that by not opposing these rules, Congress might be inclined to throw a few other ones that there that are equally difficult to adhere to. They have to speak up if it's hurting them, IMO.

Hmm, maybe I have been taken in by the media. I hear about the domestics being opposed to this law, but not as much from Toyota. I know Toyota makes several gas guzzling vehicles, but they have a fuel efficient image. They do make many fuel efficient cars. They engineered the 3.5 6-cylinder quite well - 268+ horsepower, yet high fuel economy. They could have just stopped engineering when they got the power they wanted, but they went a step further and made it efficient, too. While the company does not support this bill, I do not think they would make a big public outcry about it, because then they maintain their green image to consumers.

Perhaps someone can answer this for me: Is it just the American wing of Toyota, like the designers of the new Tundra, that is against this bill, or is Toyota HQ in Japan also against this measure?

69Firebird400, I understand what you are saying about the automakers having a right to voice their opinion. However, with the domestics rebuilding their images, I would think they would want to avoid negative press. To me and probably many Americans, their concerns come off as "I don't wanna" bitching from a 6-year old. More and more of the market is shifting towards fuel efficiency as a greater priority, and if the domestics can stand and deliver as well as the Asians presumably will, they can gain back some market share. Complacency will get us nowhere - "We shall have no better conditions in the future if we are satisfied with all those which we have at present." - Thomas Edison.

[Havasavana]

Can someone who knows explain how CAFE is affecting GM? My guess is that GM sells things like the Cobalt at a loss to improve their CAFE numbers and reduce the fine they'd be hit with otherwise. So without CAFE what? Would they not have an entry like the Cobalt? If so, how would that help them? I don't see it helping their image at all. For those who want to let the market drive everything, would you prefer that ethanol subsidies be eliminated? How about mandates regarding the construction of ethanol plants? If CAFE goes, what will happen to GM's interest in ethanol?