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Old 12-11-2008, 12:13 PM   #1
AVANTI R5
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Default Drastic Fuel Economy Increases Could Stem From Bailout and Cripple Automakers -





Quote:
http://www.caranddriver.com/blog/200...ses-could.html

Detroit automakers just agreed to dramatic fuel economy increases, but a string in the proposed bailout could further increase mandated mileages so much that no trucks could be sold in California.


Update: As of December 10, the bailout package approved by the U.S. House of Representatives (but stalled with the Senate) no longer contains provisions stipulating that U.S. automakers must drop their opposition to state greenhouse emissions standards. Legislators took out this provision at the behest of the Bush administration.


If this provision doesn’t get reintroduced into the bill by the Senate, automakers will continue their legal opposition to fuel economy increases beyond those already signed into law. If California and joining states win the suit, these massive increases still could be possible.

In addition to the new CAFE national fuel-economy regulations mandating automakers achieve a fleet average of 35 mpg across all vehicles sold in the U.S. by 2020, pending legislation in California would essentially impose even higher fuel-economy standards on vehicles sold in the state by restricting greenhouse-gas emissions. The amount of carbon dioxide a vehicle emits is directly proportional to the fuel it consumes, meaning that a vehicle cannot reduce its CO2 emissions without increasing its fuel economy.



If passed, the proposed legislation would have a grave impact on the U.S. auto market. It would essentially create two zones of sales in the U.S.: California (and the other states adopting its standards), and the rest of the states.


Since a high percentage of the country's sports cars are sold in California, it has been suggested that many exotic car companies—Ferrari, Lamborghini, and Porsche, for example—would simply withdraw from the U.S. Other automakers could be forced to pull out of the restricted market in order to continue selling trucks and SUVs. Even mid-size and large cars would be unable to meet the California standards without expensive alternative propulsion systems.


GM’s own Chevrolet Volt would be one of the few cars that could meet California standards, but it likely will cost more than $40,000, and it is a compact. The legislation would artificially create stricter fuel-economy standards while the automakers are already struggling current federally mandated increases.



A consortium of automakers, including the Detroit Three, is suing California to block the legislation from being passed. This lawsuit is now tangled up in the fight over the bridge loans needed by General Motors and Chrysler to ease them through their current financial crisis.



Senator Barbara Boxer (D-California) has inserted language into the "bailout" legislation that effectively prohibits General Motors, Chrysler LLC, and Ford from participating in the ongoing lawsuit. Environmental groups also have been demanding the domestic carmakers drop the lawsuit in return for accepting public assistance.



The domestic carmakers, which desperately need the money, don't have much option but to give in to the demands, says one Detroit-based public-relations consultant. The negotiators for Detroit's carmakers had even suggested at one point during the discussion a higher gasoline tax to help promote conservation, but were flatly told that that was a "non-starter," according to one industry source familiar with the negotiations.



"When your backs are against the wall, you are focused on survival," says Jason Vines, who over the years has headed the public relations effort at Nissan, Ford, and Chrysler. Going forward, other carmakers will decide whether to pursue the lawsuit, Vines notes.



Kim Custer, spokesman for the Washington D.C.-based Association of International Automobile Manufacturers, says his association, which counts companies such as Toyota, BMW, and Volkswagen among its members, will continue to support the California litigation because it believes that the nation needs single fuel-economy standards.


California's Greenhouse Gas Law, which has been copied by more than a dozen different states, has led to an unwieldy proliferation of regulations, he says. "We think there has to be one standard," he says. Otherwise carmakers would wind up restricting sales of some vehicles in different states to meet the different regulations.



Automakers, both foreign and domestic, have argued for more than three years that California's limits on the emission of greenhouse gases such as carbon dioxide basically represent a new way to promote far tougher fuel-economy standards than are currently embedded in federal CAFE regulations. In fact, the Bush administration, which has been pushing Boxer to drop her demands, said as much last year when the Environmental Protection Agency rejected California's request for a waiver from the Clean Air Act.



"California's current waiver request is distinct from all prior requests," said EPA Administrator Stephen L. Johnson in a statement. "The Bush administration is moving forward with a clear national solution—not a confusing patchwork of state rules—to reduce America's climate footprint from vehicles," Johnson added. "President Bush and Congress have set the bar high, and when fully implemented, our federal fuel-economy standard will achieve significant benefits by applying to all 50 states," Johnson said.



"The two primary approaches for reducing greenhouse-gas emissions from vehicles are increasing the fuel economy of vehicles and reducing the emissions associated with their fuel. The recently signed energy bill addresses both approaches by increasing the fuel economy from vehicles to 35 mpg, an increase of 40 percent, as well as increasing the amount of renewable fuel used to 36 billion gallons (annually), a five-fold increase," Johnson noted.



California Governor Arnold Schwarzenegger has fought the EPA ruling and appears to have gained an ally in President-elect Barack Obama, who has promised to review the EPA's decision on the California standards.

Meanwhile, the automakers—American, European, and Asian—also face new regulatory challenges from the European Union, which is pushing carmakers to make significant cuts in greenhouse-gas emissions.
The U.S. Supreme Court ruled decisively in April 2007 that the EPA does have the authority and an obligation to regulate global-warming emissions.



Automakers have argued, so far to no avail, that California regulations pose significant technical challenges that would force them to build smaller and lighter vehicles. Cars built under California legislation would not offer the performance, capability, or utility of present-day vehicles. GM vice chairman Bob Lutz has said GM's own internal studies indicate that in order to meet California's greenhouse-emissions rules, cars would have to get at least 43 mpg at minimum.



California's environmental movement has gained influence with the election of Obama and the tussle over the bridge loans for GM and Chrysler, and the state seems to want to enforce its demands for smaller and more-efficient vehicles by any means necessary. "The Michigan Congressional delegation has just been overwhelmed," noted one consultant.
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Old 12-11-2008, 01:23 PM   #2
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The reality of it is - we don't have a choice we need to get more fuel efficient cars / trucks on the show room floors. Clearly the domestics haven't taken the lead in doing this they had plenty of writing on the wall to be ready for it.

This large jump in milege is very possible given many makers are already doing it.

Shoot I've been researching MB 3L V6 diesel - talk about an amazing piece of technology.
They have 5000lb 6-7 passenger vehicles getting mid 20's in mixed driving and high 20's on the highway! -- the profitability for these are much higher than hybrids. They may not be the final answer but its a big step in the right direction and something the auto makers can do now. Electric stuff still needs time to sort out the biz and tech and is needed but the milege issue can be matched without massive steps on the tech side.
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Old 12-11-2008, 01:38 PM   #3
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^^IIRC the MB diesel is not yet approved for sale in CA. VW's is though. So if CA gets its way, the only vehicles you'll be able to buy there will be VW diesels, a few hybrid cars, and "neighborhood electrics" aka golf carts.
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Old 12-11-2008, 01:54 PM   #4
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Wirelessly posted (BlackBerry8100/4.2.1 Profile/MIDP-2.0 Configuration/CLDC-1.1 VendorID/100)

The rate of required improvement is roughly equivalent to the rate that was required the first time fuel economy standards were put in place in the 70's. The auto industry went on from that to sell more, larger and more powerful trucks then could be imagined in 1974.

Don't buy into the "we can't do it" BS.

Can has 60mpg Fiesta Econetic?

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Old 12-11-2008, 02:42 PM   #5
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It's a shame the car companies can't just opt out of California or better yet that the government of California doesn't allow their citizens to determine what best meets their automotive needs. There's one thing that California doesn't lack and that's people that want to control others' lives.

BTW - It will be a disaster of each state is allowed to set their own automotive rules and regulations. Think about having the possibility of 50 different sets of rules and regulations.
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Old 12-11-2008, 02:47 PM   #6
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Quote:
Originally Posted by Mike Wevrick View Post
^^IIRC the MB diesel is not yet approved for sale in CA. VW's is though. So if CA gets its way, the only vehicles you'll be able to buy there will be VW diesels, a few hybrid cars, and "neighborhood electrics" aka golf carts.
Funny the MB dealer across the street from me has 10 GL320 Bluetech diesels parked out front for sale. I live in CA.
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Old 12-11-2008, 04:37 PM   #7
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^^Maybe they just got them approved. I'm in MA, which follows CA standards, and my dealer had no diesels last time I checked.

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The rate of required improvement is roughly equivalent to the rate that was required the first time fuel economy standards were put in place in the 70's. The auto industry went on from that to sell more, larger and more powerful trucks then could be imagined in 1974.

Don't buy into the "we can't do it" BS.

Can has 60mpg Fiesta Econetic?
Of course its possible but at what cost? Greatly improving fuel economy from a '70s base was a lot easier than it will be now
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Old 12-11-2008, 04:49 PM   #8
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Quote:
Originally Posted by Mike Wevrick View Post
^^Maybe they just got them approved. I'm in MA, which follows CA standards, and my dealer had no diesels last time I checked.



Of course its possible but at what cost? Greatly improving fuel economy from a '70s base was a lot easier than it will be now
I walked over to check out the Rclass which I just recently discovered its a bit of an odd ball wagon/minivan smash up persay not a wagon and not a minivan. Nice size though. Dealer said the ML's with bluetech are being delivered now they got their first few two weeks ago. The Rclass will be a little later he thinks they'll have a couple in a week or so.

Crazy thing is he said the top priced ML gasser is still selling like hotcakes right now. They thought that people would really find the big mpg jump with the diesel more attractive though most of their buyers don't know about the diesel and just want the gasser etc.

The cool thing about the R is that its such an odd ball the prices are way down but it has the same exact running gear as the $70K ML. So if your not all hot and bothered about an SUV you could pick up an R with the same running gear for almost half the price.
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Old 12-11-2008, 05:10 PM   #9
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I was filling up (Hummer) and a GL bluetech was filling up next to me. Great to see people buying them. Maybe there will actually be a transition to diesel in the US and i won't have to do research on where to fill up since diesel stations are so scarce.

Nick
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Old 12-11-2008, 06:08 PM   #10
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Quote:
Originally Posted by White out View Post
I was filling up (Hummer) and a GL bluetech was filling up next to me. Great to see people buying them. Maybe there will actually be a transition to diesel in the US and i won't have to do research on where to fill up since diesel stations are so scarce.

Nick
500-600 miles per tank - I think you can make it across the street to the station with diesel. :-) -- however Hummer and no gas at the pump you might be hiking it with a jerry can
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Old 12-11-2008, 06:54 PM   #11
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This is something the free market can easily handle. The manufacturers will pull out of markets they cannot compete in. People will scream at their lawmakers because they can't buy the car they want. Law will change.

Then, down the road, gas will become expensive again and people will vote with their wallet.

In both cases the free market will be the real decision maker.

And frankly, imports aren't any better at fuel economy than the big three. In many cases (especially when they try to make a pickup...) they're worse.

If people want to buy hybrids and electric cars, they'll pony up for one at market prices. Otherwise the technology will fade away until we actually need it. This is how it should be.
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