Pushing Detroit onto a greener road
I was listening the other day to a couple of American automobile executives complain to the president of the United States about emission regulations and all their other burdens -- high wages, government safety mandates, unfair foreign competition. You know the list.
They said this stuff was killing the industry. “We are in a downhill slide, the likes of which we have never seen in our business,” one remarked. The Japanese, he said, “are in the wings ready to eat us up alive.”
Then they all started grumbling about Ralph Nader and the consumer movement, and that sounded a little, well, anachronistic. So I checked the tape, and darn if it wasn’t from April 1971 and the guy talking was Lee Iacocca, then president of Ford, and the president he was jawboning was Richard M. Nixon, who kindly taped the exchange for posterity.
But that’s the thing about the U.S. auto industry: Its technology marches on -- anyone remember push-button transmissions? -- yet its whining and bellyaching never seem to change. This week President Obama signaled that the automakers’ tantrums might not count for much in Washington anymore.
He did so by effectively clearing the way for California to impose stringent emission standards on cars and light trucks, over the industry’s vehement objections.
Obama ordered the federal Environmental Protection Agency to consider waiving its exclusive authority to set clean-air standards so California can implement regulations that the state Air Resources Board adopted in 2005. The Bush administration blocked the waiver -- the first time California had ever been turned down by the EPA after dozens of requests. Now it’s almost certain to be approved.
It’s hard to overestimate how momentous an advance in U.S. climate policy this could be. California’s standards, which aim to cut tailpipe emissions of carbon dioxide and other greenhouse gases by more than 40% from this year to 2020, have been a beacon for American environmentalists during a very dark few years. (Gov. Arnold Schwarzenegger, by the way, deserves praise for pressing the Bush administration on the issue.)
Once California gets its waiver, its rules may become the de facto emission standard nationwide: Thirteen other states and the District of Columbia are poised to impose the California standards as soon as they’re cleared, and six more states have them under active consideration.
It’s also hard to overstate how vehemently Detroit has fought these standards. (Foreign automakers aren’t innocent -- some of them have been fighting the rules too.) The industry has sued in California, Vermont, Rhode Island and New Mexico to block them. A federal judge threw out the Vermont case in 2007; the others are pending.
Detroit’s chief complaint is that the California standards, if imposed state by state, would produce a “patchwork” of 51 regulations that would be impossible, or at least very costly, to meet consistently. (The standards are keyed to the mix of vehicles sold, which can vary widely by state.)
Of course, that merely signals that the carmakers plan to do the absolute minimum to meet California’s regulations.
Nothing would prevent them from embracing the challenge and aiming to get over the bar in every jurisdiction. But U.S. automakers have always preferred to fight a regulation than find a way to comply through improved engineering. It’s probably possible to figure out how much money they’ve wasted on lawyers trying to beat regulations in court, but I’m not sure a calculator exists that can display that many digits.
The gold standard for its approach is that meeting Iacocca and Henry Ford II, Ford’s chairman, had with Nixon on April 27, 1971. Ford and Iacocca groused that requirements for shoulder harnesses, headrests and air bags would drive the cost of cars into the stratosphere.
The price of a Pinto, Ford said, would go up by 50% if they had to install passive restraints. (He may have been on to something. The Ford Pinto was basically a dynamite stick with a tailpipe, so strapping passengers in with shoulder belts rather than giving them ejection seats may have been the wrong choice.)
Nixon, crabbing along in harmony with them about “demagogues” like Ralph Nader, obligingly relaxed the passive restraint rule.
Detroit has predicted that almost every regulatory mandate it faced would produce economic Armageddon. It was always wrong. In the 1970s, the carmakers said emissions standards would bankrupt them. Then came the catalytic converter, which enabled them to meet the standards easily. They said Americans would balk at safety devices like air bags. Instead, safety turned out to be a big selling point, so today they compete on who can fill a car with more side, front and curtain air bags.
Their biggest miscalculation was that fuel economy wouldn’t matter to the buyer. So they let Toyota and Honda beat them to market with hybrids -- by years.
Continuing to fight the last war, they oppose the California regulations on the assumption that they’re more stringent than the federal rules. On the surface that’s true. Although the emissions rules aren’t the same as fuel economy standards, they’re closely related, and California’s rules, according to calculations by the Natural Resources Defense Council, would produce average fuel economy of about 40 miles per gallon by 2020, exceeding the federal goal of 35.
But the NRDC observes that as high fuel prices drive Americans to smaller, thriftier cars, the state’s system will benefit the industry by giving it more flexibility in meeting the standards, via credits for alternative-fuel vehicles and smaller cars.
“Under any realistic scenario they’ll be better off with the California regulations,” Roland Hwang, an NRDC transportation policy analyst, told me.
It’s certainly true that the only path to long-term viability for the American auto industry goes through advanced technology and more efficient products. We know this because the Big Three’s CEOs said so to Congress in December, when they came asking for billions in handouts.
But will they ever cease whining and get down to business? Responding to President Obama’s initiative, an industry spokesgroup complained that Detroit currently faced “different standards . . . and different timelines” from three regulators -- California, the EPA and the Department of Transportation -- and said it sought “one national standard.” That sounds like it’s girding for more lobbying.
In other words, just what got it where it is today.
Michael Hiltzik’s column appears every Monday and Thursday. You can reach him at firstname.lastname@example.org and read his previous columns at www.latimes.com/hiltzik.