By on June 20, 2019

The United Auto Workers is spending Thursday telling Congress that the union opposes the Trump administration’s proposal to freeze fuel efficiency requirements at 2020 levels through 2026… sort of. While the UAW expressed moderate environmental concerns in the past, most of its opposition to the rollback has revolved around corporate investments into the industry. In fact, the union’s research arm called fuel economy the auto industry’s “future” in 2018.

This time around, the UAW seems to be singularly focused on business aspects. According to a prewritten testimony, UAW Legislative Director Josh Nassar intends to tell two subcommittees of the U.S. House Energy and Commerce Committee that the union is in line with automakers’ concerns about the proposal leading to “protracted litigation and uncertainty in the industry that will limit growth.”

Despite lobbying to have the rules softened, the auto industry is now concerned that pushback from California and a collation of supportive states could throw a wrench in the plan or even split the American market in half. If you’re want some background on the subject, we’ve covered it endlessly. But, to summarize, California is ready to go to court over the ability to set its own fuel-economy rules and vowed to sue if it doesn’t get its way. Automakers (and even oil concerns like BP) have repeatedly asked for the White House to seek common ground with the Golden State. But neither side seems interested in losing one iota of regulatory power, at least according to the other’s claims.

Reuters reported that California Air Resources Board head Mary Nichols will also be present on Thursday to better explain the state’s position. “We have been open to accommodations that would adjust compliance timing and flexibility, that would create new paths to promote innovative technologies and zero emission vehicles, and that would benefit the public,” her testimony states, adding that “the net cost of the federal rollback nationally at $168 billion.”

Louisiana Attorney General Jeffrey Landry be on hand issue a rebuttal to California’s claim that it should be allowed to self regulate. “California should not be able to effectively dictate fuel economy standards, tailpipe emission requirements, and mandates for zero emission vehicles,” his testimony reads. “California has circumvented Congress and used its size to create a de facto national fuel efficiency framework.”

In addition to calling California a bit of a bully, proponents of the rollback have also claimed the existing efficiency targets are in stark contrast with market realities. Consumers, encouraged by low gas prices and personal preference, have shifted increasingly toward larger crossover vehicles. In fact, sales-weighted Corporate Average Fuel Economy research has shown practical U.S. efficiencies stagnating since 2014, as economy focused vehicles have fallen out of favor.

From Reuters:

Deputy National Highway Traffic Safety Administrator (NHTSA) Heidi King told the U.S. Senate Commerce Committee on Wednesday that existing fuel efficiency standards have hiked the cost of new vehicles and may “discourage consumers from replacing their older car with a newer car that is safer, cleaner and more fuel efficient.”

She will raise concerns before the House panel Thursday that the United States is “facing an affordability crisis in the new car market,” according to her testimony seen by Reuters.

King said NHTSA and the Environmental Protection Administration are reviewing more than 650,000 comments. King and Bill Wehrum, the EPA’s assistant administrator for air and radiation, will testify on Thursday at the House hearing. The agencies are working to finalize the rule “as soon as possible,” according to Wehrum’s written testimony.

The “preferred alternative will prevent thousands of on-road fatalities and injuries” compared to the Obama-era standards “as more people can afford safer, new cars,” his testimony said. Environmentalists and California strongly disagree with that analysis.

The safety argument is a little wonky. Regardless of efficiency rules, automakers will have to continue building cars under existing safety mandates. But there is a chance that manufacturers could start relying on smaller, lightweight models to reach swelling mpg targets. Critics are worried these hypothetical automobiles won’t perform terribly well when going head-to-head with older/larger vehicles. However, we’re inclined to believe that the biggest risks stem from going against consumer trends or dissuading the industry from innovating. Unfortunately, championing either side fully essentially encourages one of the two outcomes.

 

[Image: Nithid Memanee/Shutterstock]

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32 Comments on “Gas War Watch: UAW Goes to Congress, Sides With Automakers on Fuel Economy Rollback...”


  • avatar
    ajla

    I’m not at all a CAFE fan but if the auto industry is unwilling to publicly and fully support the proposed rollbacks then I think the WH should just drop it.

    There are bigger fish to fry in the country that aren’t such an uphill fight and resources (for both sides) could be better spent elsewhere.

  • avatar
    Fred

    Sooner or later there will be a liberal Democrat in office and the standards will be back on. Not only that but they still have to negotiate states like California. Get over it and make your cars greener and more efficient. Resistance is useless.

    • 0 avatar
      Jon

      We are the liberals. Lower your emissions and surrender your ICE’S. We will add your chemical and technological distinctiveness to our own. Your culture will adapt to service us. Resistance is futile!

    • 0 avatar
      SPPPP

      And if automakers knew the standards would again increase in a few years, couldn’t they just plan their sales to the meet the higher standards, and enjoy the holiday from penalties in the meantime? You act as if they have no brains.

      • 0 avatar
        highdesertcat

        They could! But like others have written, this is all about M-O-N-E-Y.

        Fiatsler had the right idea when they came out with their niche cars with Big V8s, and they make a ton on every one of them, and they sell every one they make.

        As a whole, the automakers do not want confrontation and lawsuits brought on by the greenweenie treehugging movement, and that’s why if President Trump rolls back the implementation of these stricter standards they would be more vulnerable to lawsuits and rogue emissions testers who would drag the automakers into court.

        Remember VW’s dieselgate?

      • 0 avatar
        ToddAtlasF1

        People are already not buying the CAFE compliant throw-away junk Obama’s regulations require in the numbers they bought cars in past years during booming economies. Only a small percentage of Americans buy new cars each year, so it matters what the smart ones understand. The inevitability of the indoctrinated suicide cult electorate having its say should be addressed by forcing a reconciliation of our exploded bureaucracy with our constitution that was designed to avoid just the outcome we’re being enslaved by. Maybe we can stave off a civil war until there’s an external force willing to save us the bother of self-destruction.

  • avatar
    Dan

    “The safety argument is a little wonky. Regardless of efficiency rules, automakers will have to continue building cars under existing safety mandates. ”

    But consumers won’t have to buy them. This isn’t hypothetical, 40 mpg cars suck and consumers already aren’t buying them. Witness the landslide to crossovers. A show room full of compliance cars that nobody wants, alongside non-compliance models that are increasingly priced out of reach, is the best possible argument to just sit on what you’ve got it.

    And crash in it.

    • 0 avatar
      Snooder

      In a world where the Kia Niro exists, that argument is bullshit.

      Seriously, I just saw a Kia Niro parked next to a Jeep Compass this morning. From a distance they looked basically the same. Same blobby shape, same general size, etc. And the Kia is, what, a grand more than the Jeep?

      It’s 2019. We should be awash in hybrid crossovers by now.

      Instead, what are the options from the big 3? Ford has an Explorer hybrid that gets 20mpg in the city.
      GM has nothing.
      Fiat Chrysler has a fucking hybrid minivan.

      That’s it. Those are all the options for a hybrid crossover from the American car makers in 20-fucking-19.

      And it’s not like they dont have the tech. All three make hybrid sedans. But then the dealer hides the sedans in the back where nobody buys them and trots out the latest and greatest crossover that all the hip millenials want. And then we all wonder why hybrids dont sell.

      Let’s be honest, people outside the hardcore enthusiast community do NOT give a shit about how many cylinders they have, or whether its electric, ICE, hybrid or otherwise. They just want a nice looking car. And the automakers keep shoving the fuel efficiency onto the ugly cars and then marketing the fuck out of the badass cars with terrible efficiency. It makes no long term sense at all since we all know that gas isn’t gonna be cheap forever.

      • 0 avatar
        HotPotato

        Amen. Twice in my lifetime, the Detroit 3 have been stuck with lots full of nothing but unsalable gas-hogs when gas prices went up. Each time, a good chunk of a generation switched to Asian brands without looking back. And here we are again: no more Focus, no more Cruze, and GM killed the Volt instead of putting the Voltec powertrain in a CUV where it belongs.

  • avatar
    chuckrs

    “”The “preferred alternative will prevent thousands of on-road fatalities and injuries” compared to the Obama-era standards “as more people can afford safer, new cars,” his testimony said. Environmentalists and California strongly disagree with that analysis.””
    Are California and environmentalists suggesting there is no economic trade-off between safety and economy, or worse, that safer, newer cars don’t affect accident and death rates? Quick, fire up the casuistry dissipator.

    • 0 avatar
      highdesertcat

      “as more people can afford safer, new cars,”

      That’s just not realistic and is exactly the reason why more people hold on to old Bessie until the wheels fall off. Average age is 11 years, I believe.

      Fewer people can afford safer, newer cars, even with 7 and 8 year loans. And more car loans are in default already than at any time since the 2009 Carmageddon.

    • 0 avatar
      Tele Vision

      “…casuistry dissipator.”

      Excellent.

  • avatar
    stingray65

    Even the UAW realizes that with no profit come no jobs and no juicy profit-sharing checks or wage/benefit increases and no reason to join a union. Green car lose money, small fuel efficient cars at best break even, while the large cars, SUVS, and trucks that make all the profits are put under threat by CAFE rules.

  • avatar
    DenverMike

    It’s not “the state’s position”, it just CARB. And they’re only looking to keep employed, huge retirement, etc. How else? CARB is as obsolete as anything from the Malaise era, and redundant to the EPA.

    This isn’t about anything other than money. The fines for non compliance are so ridiculous low, no automaker would need to comply. Except the fines would be into the billions, just in CA. Fines are kept small for a very good reason, never adjusted for inflation. What other fines are no bigger than in 1973?

    • 0 avatar
      highdesertcat

      California Air Resources Board. Not everyone subscribes to their standards and individual states should each take a position on the issue.

      Colorado did and sided with CA. So did NY.

      But other states objected, so I hope that the auto industry will go back to the dual standard that existed when there were CA-emissions, and emissions standards for all other states.

      It worked then. That’s when EGR pumps were popular, but only in CA.

      • 0 avatar
        HotPotato

        More than a dozen states now automatically adopt CARB standards. They’re not California standards, they’re California, Colorado, Connecticut, Delaware, Maine, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington, and Washington DC standards.

        • 0 avatar
          highdesertcat

          HotPotato, but these are “me too” states you listed and not the originators/developers of those standards.

          I know about New Mexico, I was a resident and property owner there from 1965 until Dec 2018.

          New Mexico is a troubled state, one of the poorest states in the Union, and a state that never had an original idea for the good of its people. It’s only the Land of Enchantment for freeloaders and illegal aliens. The NM taxpayers are really the ones who are hurting. And they are complaining, to no avail.

          The adoption of CARB standards is only a means to make it seem that New Mexico is a relevant player for the auto industry.

          It’s not. There just aren’t that many people that live and work in NM, even fewer that actually pay taxes in NM, to make a diddly of a difference.

          I can’t speak about the other states you listed but my guess is that adoption of the CARB standards there is not high on the minds of THEIR motorists.

  • avatar
    28-Cars-Later

    “She will raise concerns before the House panel Thursday that the United States is “facing an affordability crisis in the new car market,” according to her testimony seen by Reuters.”

    Funny, we have one of those with housing too.

    Next will be the grocery store. Then all bets are off.

    • 0 avatar
      sgeffe

      Especially with all the rain that the Midwest has gotten since early spring.

      In Northwest Ohio, a lot of the farmers aren’t bothering with corn and soybeans; they’ll do better with insurance checks at this point.

    • 0 avatar
      HotPotato

      Yep. If there’s an affordability crisis in education, an affordability crisis in cars, an affordability crisis in houses, an affordability crisis in health care etc., then maybe what we REALLY have is a crappy-wage crisis. If you look at a chart of where the income gains have gone since the 1980s, it’s mostly to the top. It used to be that workers became more productive and got more pay. Now they become more productive, and the boss gets more pay. And for good measure, mandatory non-compete agreements in many industries keep even fast-food workers from taking their skills to a competing employer for a better paycheck.

      • 0 avatar
        ToddAtlasF1

        It’s almost like we don’t need open borders unless you’re the Koch brothers trying to suppress wages or George Soros trying to eliminate national sovereignty.

  • avatar
    James Charles

    The US has brought this fuel efficiency issue on itself.

    Get rid of CAFE, CARB, etc. Who cares if a Mitsubishi Mirage has a V8, or an F Series has a 2 litre diesel.

    Why not use fuel pricing to change habits? This would be so much more cost effective. So long as you meet emission’s requirements.

    I can’t believe the US Big 3 have an issue to meet much higher FE. Other countries can do it. Or, are the Big 3 locked into an uncompetitive position, unable to produce suitable more efficient vehicles?

    Its not customer demand either, customer demand can be influenced as it is now in most countries.

    • 0 avatar
      ajla

      “Why not use fuel pricing to change habits?”
      “customer demand can be influenced”

      If American politicians attempted to raise fuel prices by more than a few cents or influence consumer demand through penalties then it is likely they would be voted out for people that would repeal those actions. Consumer influence through subsidies or a CfC program might get more traction though.

      • 0 avatar
        James Charles

        ajla,
        You don’t change prices over night. Do it over 15 to 20 years.

        Index taxation increase with the CPI on fuel. This allows for a period of transition for the manufacturers. This would be a very reliable and consistent framework for both energy and vehicle manufacturers to base the future direction of their business.

        • 0 avatar
          DenverMike

          @BAF0 – Thank’s but it’s not just The Big 3 “having an issue”.

          Yes kill CARB and CAFE where they stand, but what “other countries” can meet the standard?

          If you mean European counties, not hardly, but consider what a clusterfuk that situation has become, regarding air quality, cancer/death/etc, and cars actually being banned.

          Toyota and Nissan are worse off than The Big 3 when you consider the fuel efficiency of their light trucks/SUVs, and not consider volume sales.

          So we burn more oil per capita. OK that’s meant to happen, “by design” really. First let’s work on the public transportation infrastructure and curb urban sprawl.

          Then we’ll pile everyone into cities and live like rats. I can’t hardly wait.

    • 0 avatar
      Snooder

      Honestly, it’s just greed and shortsighted thinking.

      Basically, a lot of the current crop of executives and management types at public companies came up through consulting firms. And they tend to have a short term mindset of “how can I make an improvement FAST so I get my bonus before I leave for the next big thing in a few years”. Instead of planning to position the company to move to fuel efficient vehicles in 10 or 20 years they try it quick, lose money and then dump it for the next quick buck as soon as possible.

    • 0 avatar
      HotPotato

      It works in Europe…but Europe also has a huge welfare state that absorbs costs that otherwise could be crippling for individuals, like health care and child care, and outstanding public transportation so driving really is more of a choice. In other words, it’s not good policy to raise costs for your citizens unless you reduce other costs for them or at least give them viable choices to avoid the cost.

      The other issue is the sheer size of the US. There are some geographically large Euro countries with high fuel taxes, e.g. the Nordics…but they do face the challenge of rural decline. If country life is boring but cheap, it’s more compelling than if country life is boring and expensive.

  • avatar
    brn

    Is it a rollback if we haven’t gotten there yet? Maybe it’s just not rolling forward as far.

  • avatar
    SuperCarEnthusiast

    Never thought that the UAW would side with the environmentist! Looks like everyone is against President Trump in whatever he tries to do to help improve the country’s economy! Still not infrastructure bill, no increase funding for border security, no…..!

    • 0 avatar
      HotPotato

      Dude, infrastructure is possibly the one thing there’s strong bipartisan agreement on. If Trump can’t get it done, that’s on him — tying it to unrelated crap like the border — and the sour turtle Mitch McConnell (who has decreed that no Democratic or even BIPARTISAN bill shall be allowed to pass the Senate).


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