AIADA Supports New Proposal for CAFE Increase
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See below for a transcript of yesterday's press conference held to unveil the Pryor-Bond-Levin amendment.
Washington DC June 15, 2007; The AIADA newsletter reported that after months of wrangling, Congress has produced a fuel economy bill that AIADA believes the Auto Industry cannot only live with, but flourish under.
This amendment raises fuel economy standards by more than 30 percent, challenging, but not crippling the auto industry. The amendment, if adopted, would raise fuel efficiency standards to a minimum of 36 mpg for passenger cars by 2025 and 30 mpg for light trucks by 2022.
Automakers currently must achieve 27.5 mpg for passenger cars and 22 mpg for light trucks. By contrast, the current Senate bill would require automakers to meet a combined car and truck average of 35 mpg by 2020, followed by 4 percent annual increases that would mandate a fleet-wide average of 52 mpg by 2030.
AIADA urged its members to contact their U.S. Senator to support the Pryor-Bond-Levin Amendment. It requires real, attainable emissions standards that will benefit all Americans.
Transcript: Levin Press conference
The following is a transcript from the press conference held Thursday by Sens. Mark Pryor, D-Ark.; Carl Levin, D-Mich.; Debbie Stabenow, D-Mich.; and Kit Bond, R-Mo.
PRYOR:
We want to thank you all for joining us today. We're here to announce a bipartisan approach to CAFE.
As we all know, CAFE's been around for a long time, since the 1970s, and it's been very, very difficult for Congress to come back in the last 30 years and pass a CAFE standard. And I think one of the reason that it is so hard is it really has to be balanced.
When you look at CAFE, you really need to be looking at auto safety, you need to be looking at how it impacts the consumer's pocketbook. You need to look at jobs, how that is impacted here in the U.S. You need to look at consumer choice, the environment, lessening our dependence on foreign oil.
And that is the reason why Congress has not been able to pass a new CAFE standard in the last 30 years, because it's been very hard to achieve that balance.
We are trying to achieve that balance with this legislation. It is aggressive. It's an improvement over what we have on the books today.
And I think maybe the most important thing that we need to say is that it's real. This is a real improvement in fuel efficiency, and it really will be good for this country if we're able to pass this.
It's bipartisan. And I want to -- I'll be the lead sponsor. Senator Bond will be the lead co-sponsor, the co-lead sponsor, however you want to put it.
And then we'll have a number of other senators. And we're excited to have this and to be as bipartisan as it is.
So, Kit?
BOND:
Well, thanks to all of you for joining us today for what I think is an historic effort.
We're in a new area -- era -- where we can and should do more to reduce pollution from vehicles. We've heard the call, and we've come together on a bipartisan basis for the first time, not just Democrats and Republicans, but labor/management, domestic and foreign automakers. We are putting forth a proposal that will support higher fuel economy standards and more.
BOND:
Together, we will increase fuel economy standards, increase clean technology usage, and increase the amount of clean fuels available to consumers, an issue as broad and as important to millions of hardworking middle-class families, supporting blue collar auto workers across the nation, deserves bipartisan consensus.
This is the kind of lawmaking that the American people want, and that is what we want to deliver. Our proposal is very aggressive, but it's doable. It will force industry to bend but not break. It will provide labor with the security they're looking for and industry with the certainty it needs.
Now, this amendment will provide the environment with fuel standards 30 percent higher than current levels. It will protect the environment with no opportunity to lower standards through so-called offramps.
Our proposal will reduce greenhouse gas emissions through mandated flex fuel engine technology, and a breakdown of big oil restrictions on service stations selling biofuels. We will say, "You cannot tell one of your retail stations they cannot sell biofuels." This amendment will provide a fair playing field for all clean vehicle technologies, including hybrid and future systems such as plug-ins.
I think the American people want us to come together on this. Time and time again, they've said they want an end to divisive, partisan politics that pit special interests against each other.
That's why I'm so proud to work with this group here for something that we are confident will be good for the environment, good for our energy security; most importantly, good for families and workers from Missouri, Michigan, Ohio, Kentucky, Tennessee -- all of the areas where -- and Arkansas...
(LAUGHTER)
... where we produce automobiles.
With that, Senator Levin.
LEVIN:
Thank you, Mark and Kit.
This bipartisan proposal is the product of a lot of work of a lot of senators. What we are proposing is a very difficult to achieve, a very aggressive standard in terms of improvement in CAFE.
LEVIN:
And one of the hallmarks of it is that it is a tremendous boost to the environment. It is achievable. It is realistic. We think the auto manufacturers are able to meet this, although they say it will be a stretch. And I want to read part of their letter to the Senate. They say it is a stretch, but we believe that they can do it.
And let me just read a couple lines from this letter from the auto manufacturers. And I emphasize this is not just Detroit. Sometimes the media says Detroit this, Detroit that. This is not just Detroit. This is the automobile industry, with one or two exceptions.
The group, the Alliance of Automobile Manufacturers, includes the following: BMW, DaimlerChrysler, Ford Motor, General Motors, Mazda, Mitsubishi, Porsche, Toyota, Volkswagen.
Now, when companies such as Toyota and Volkswagen say, as they do in this letter, that they strongly oppose the Commerce Committee bill, that they believe that they would debilitate the industry, I would hope that people would be open-minded and listen to that without their feelings about the Big Three -- which very often or too often, in our judgment, are negative -- but that they would look at this objectively and ask themselves, "Well, wait a minute. This isn't just the Big Three that says that the proposal of the Commerce Committee cannot be realistically achieved."
This includes Toyota. That is viewed as a green company by many people. This includes Volkswagen.
And then the question needs to be asked and will be asked, hopefully, by our colleagues in an objective way, whether or not our bipartisan proposal in fact is aggressive -- it is -- in fact is achievable -- it is -- in fact will promote clean fuels -- which it does in a number of its provisions -- whether it will promote the development of leap-ahead technologies, which it does in very, very strong ways.
LEVIN:
It promotes partnership between government and the industry, all of it, to promote leap-ahead technologies, which are the best way to go environmentally.
The incremental gains that CAFE can and has produced cannot compare to what leap-ahead technologies can do for the environment. But we need to put resources there.
The industry needs to be allowed to put its resources there, into plug-in hybrids, into hydrogen, into advanced diesel and so forth.
It's those leap-ahead technologies which hold out the best hope for major environmental gains. Our gains, environmentally, are significant. And one of the reasons they're significant is that we have a provision in here to spur the availability of alternative and advanced technology vehicles, as well as the alternative fuels and infrastructure.
The UAW, which is a progressive union, says that it cannot support; it opposes the Commerce Committee provisions. And it says that our provisions are something which they believe would help to keep an American automobile industry.
They do not believe that our increase would threaten the jobs and the benefits of workers and retirees in the auto industry, unlike, they point out -- and this is their words, and you have a copy of this letter -- "unlike the increase in the Commerce Committee bill, which could result in additional plant closings and the loss of health insurance benefits for a half a million retirees and their beneficiaries and their families."
So, strong development of leap-ahead technologies; expanded availability of clean fuels; aggressive but achievable mandatory fuel economy standards; clean technology requirements which are binding for an increased percentage of vehicles; no off ramps.
LEVIN:
We think that is the ticket. That's the bipartisan approach which we believe can and should capture a majority of the U.S. Senate.
Senator Stabenow?
STABENOW:
Thank you so much.
I'm so pleased to be here today with my colleagues. And I first want to thank Senator Pryor and Senator Bond for coming together to offer this bipartisan amendment and to take the lead on the amendment.
As you all know, Senator Levin and I, of course, are deeply involved in this issue as the international headquarters of our domestic auto industry, that we understand and know that together we can do something positive both that the industry can stretch to meet, but also a proposal that will not hurt desperately -- desperately hurt an automobile industry on which so many of our people depend for their jobs and is such an important part of the economy.
This is important to Michigan. But it's also important to Arkansas. And it's also important to Missouri. And, frankly, it's important to the entire economy of the country, given the fact that it is the auto industry -- as the largest employers in the country -- that truly have created the middle class of this country.
They've done the right thing by paying good wages and health care and benefits to people for generations. And we want to keep them strong and viable and fuel efficient for the future.
Let me just speak to the specifics of the proposal in front of us for a second, to outline that. We are talking about a 36 mile per gallon CAFE number for automobiles, for cars reached by 2022, a 30 mile per gallon level of CAFE by 2025 for trucks, very important provisions on alternative fuel vehicles.
We mandate that at least by 2015 -- and we believe that the industry can do this sooner -- at least half the vehicles should be flex fuel or alternative fuel vehicles.
We, as Senator Bond said, include provisions that allow our service stations to be able to contract for pumps, E85 pumps, other kinds of pumps and make sure that they can't be stopped by the oil companies from doing that.
And then we've also focused very much -- and it's part of the underlying bill as well -- but we want to see beefed up efforts to support research and development, as well as important tax incentives that we intend to mark up next week in the Finance Committee.
There's a very important piece of this in terms of incentives for automobile manufacturers, for suppliers, for the new technologies and we will be bringing legislation out of the Finance Committee next week to pair with this.
I would finally just say that this is a very important energy bill that's on the floor. It has many, many component parts that are important for moving us forward to energy independence, moving us forward in terms of energy efficiencies.
And what is historic, I believe, is that we will see a CAFE -- a fuel efficiency increase in standards in this bill. The question is, what will it be? Will it be one that stretches the industry but does not eliminate or dramatically hurt our industry in the United States, or whether it will be one that the industry has indicated -- across the board, domestic and foreign -- have said they cannot achieve.
STABENOW:
And I want to again thank my colleagues for coming together around something that is a major step forward, but it's something that allows us to keep jobs in the United States and focus in a way that's doable.
QUESTION:
Senator Levin, why did you all drop provisions that allowed automakers to drop out of CAFE altogether if they (OFF-MIKE)? Was that received too coolly by the other senators?
LEVIN:
No. I think that there were some opponents who would have mischaracterized this as a loophole. Its intent was the opposite. Its intent was to promote leap-ahead technologies, which we believe represent the best hope for increased fuel economy.
That was its purpose. It represented what was a -- what I thought was a creative approach to promoting leap-ahead technologies by getting legally binding commitments from the auto industry to put resources into those technologies as an alternative to the incremental CAFE approach.
But it had already been mischaracterized enough by some folks outside of the Senate that I didn't want to in any way jeopardize what was an important bipartisan approach in the other provisions. And that's the reason why I agreed to drop that provision.
And by the way, a couple of the original co-sponsors, Senator Voinovich and McCaskill, are not able to be with us today, but they also will be original co-sponsors.
QUESTION:
How many senators do you have lined up (OFF-MIKE)?
LEVIN:
These are the co-sponsors. Beyond that...
(CROSSTALK)
STABENOW:
We have a number. (OFF-MIKE) anticipate a robust debate...
(UNKNOWN)
And a close vote.
STABENOW:
... close vote. But we have many people supporting this.
QUESTION:
Does the lack of an off ramp offer something to senators who might be on the fence about whether or not to back the alternatives?
BOND:
I think this is important. We're setting a standard that we expect to be met. And we don't want people playing around with, "Well, we can get out of it this way, we can get out of it that way."
We gave tough goals, reasonable deadlines, and we're saying, you know, you got to meet them. End of story. And we don't want something that, "Oh, my gosh, you know, how do we get on the off ramp?" No off ramp, just get the job done.
QUESTION:
Presuming that you've spoken with Senator Feinstein about this, so what has been her reaction?
STABENOW:
Well, she has -- obviously, she's worked very hard on her proposal and prefers her proposal. And so we expect to be voting on our proposal and making the case to colleagues that this does what is achievable, is reasonable, keeps jobs in America. And we're hopeful that we'll be successful.
LEVIN:
But a number of discussions with Senator Feinstein, and those will continue.
QUESTION:
The industry argument that they can't meet this sounds awfully familiar. I mean, we've heard that almost every time CAFE standards come up, and yet, it hadn't destroyed the industry when they were first instituted, and it hadn't destroyed the industry when they had to put in airbags and safety belts, when they said that those would hurt jobs (OFF-MIKE)
It's, kind of, a "cry wolf" situation.
PRYOR:
Well, you know, actually, this is interesting that you asked that. Because maybe one of the reasons I'm standing here today is because of some conversations I had with the auto industry a month before the vote in the Commerce Committee, a week before the vote and a day before the vote.
And one thing I told them, in no uncertain terms, is they have a problem here in Washington, D.C. And that is, any time CAFE comes up, it's always no, no, no.
And I said you have -- I said, I'm for increased CAFE standards. I'm for increasing energy efficiency for all the reasons that we've already talked about. But, I said, you have to give us something that you will say yes to.
And you know, the committee vote -- I think it was a voice vote, but it was going to be lopsided. And so, whether they've had their head buried in the sand in years past, I don't know. I wasn't here when all that happened.
But I do know this, that they would probably much prefer not to have any CAFE standards. But this is the reality of where we are today. And I think America wants stricter, tougher CAFE standards.
We've come up with a bill that does that. And some people may ask why in the world am I doing this, because I don't have a major auto plant in my state.
And you know, two of the reasons I'm doing this is my two children. I have a 13-year-old and an 11-year-old. I want them to grow up in a cleaner and greener America that's less dependent on foreign oil.
But I also want them to drive around in safe vehicles. I have a concern -- and it's more than a small concern -- about the safety of vehicles that have to increase 10 miles per gallon over 10 years, and then another 10 in the years after that.
You know, if you do the math on that, you just wonder how in the world do you achieve that kind of energy efficiency and still have safe vehicles?
So, again, this is a balanced approach. I know that this is one of those bills where not everybody's going to be happy.
You know, the auto makers would rather not be here today, but they are. The environmentalists would probably -- instead of doing 10 in '10, they'd probably rather have 15 in '10 or 20 in '10 -- you know, whatever it is. I don't know the numbers.
But we're trying to find a balanced approach. And in the Senate, balance means, do you have enough votes to get it passed?
And it may be 50 votes; it may be 60 votes. But that's what we're working on. We're trying to achieve something here that's good for America, that's balanced, that makes sense, that's great public policy long term.
BOND:
Mark, let me add one thing: If there are additional technology advances that come forward, going back to the previous Bond-Levin, Levin-Bond approaches, we say that these are minimum standards. These are standards, these are technology forcing standards, but if additional technology comes forward that can increase that, then the National Highway Traffic Safety Administration can go above that on maximum achievable levels.
QUESTION:
A question for Senator Bond: A lot of the focus has been on the Michigan senators and your Democratic colleagues here. How much conversation have you had with Republicans? And what kind of support do you think either of these proposals will get from your side of the aisle?
BOND:
Well, I can't give you -- I'm not going to give you a final count. We're in the process of vote counting. I've had some frank and earnest discussions. I was very frank; they were very earnest.
I will continue to work on those. But now that we have this specific proposal out there, the ones who are undecided will get some conversation. And George Voinovich and I and I expect others will be joining us.
It's too early to give you counts. I just hope we get more than we have now. But we've got a lot of people who are favorably inclined. I don't need to have favorably inclined; I need to have guaranteed votes.
QUESTION:
A question for Senator Stabenow and Senator Levin: It's a little off context, but the Senate (inaudible) on this renewable portfolio standard. And this is only the first of the hard issues to be tackled in the coming days.
Does this provide sort of a bad omen for a fight for the rest of the bill?
QUESTION:
(OFF-MIKE)
STABENOW:
Well, I think -- I mean, we're trying -- we're moving positively in a direction that we need to go as a country to address energy independence and gas prices, important policies across the board, and there are multiple interests, just as we have our interests. And the renewable portfolio standard is one area. We have issues related to coal that we will be debating, as well as this proposal and others.
So it will be like any comprehensive proposal. I remember the energy bill in 2005 and all of the work that it took for us to move forward on something, and a couple of tries.
So I would expect this to be something where there's a lot of hard work involved. But I also believe at the end of the day, if we all work together and there's tremendous bipartisan support and understanding of where we need to go, where we need to go as it relates to what's happening on global warming.
So we can -- we can do something very important. We can do something very important that both addresses the environment and American jobs at the same time. And that's the goal.
LEVIN:
There's a consensus that global warming is real, I'd say. And there's a consensus that we need to do something very major to address it. And that consensus will hopefully carry the day into a bipartisan energy bill.
But the very strong feeling that we must address climate change is real, and I hope we take the time to work out the differences on whether it's the CAFE approach or anything else.
QUESTION:
When do you expect to have the amendment on the floor? And did you soften the flexible fuel mandate to win the support of international automakers?
LEVIN:
On the floor it will be...
(UNKNOWN)
Next week.
LEVIN:
It'll be next week. I guess that's the safest way to say that. I talked to Senator Feinstein about that question because we want to make sure that everybody who had an interest in this, in all fairness, would be here. And so it'll be next week, in terms of that.
In terms of softening the flex fuel mandate, I would say that that was a subject of discussion, including the international automakers, and their concerns are hopefully reflected here.
But what that emphasizes, your question, is that this isn't all the automakers, but one or two. But the key automakers in the world say that with a stretch this is achievable, but that the Commerce Committee numbers are not.
LEVIN:
And I, again, do the best I can to try to broaden this and to state accurately for you, so that you can state accurately for your folks, that this is not a Detroit issue; it's not a Big Three issue.
This is a question of the auto industry as a whole, including Toyota, Volkswagen, and others, as to whether or not the number in the Commerce Committee bill is achievable.
And they say -- not Detroit, not Big Three -- they say, including Toyota and Volkswagen, that that number is not achievable.
But the answer of your question is, there was consideration given to the arguments made by the foreign manufacturers on that issue.
BOND:
Well, and frankly they're talking about 50 percent flex- fuel vehicles by 2012. Many auto companies already are turning out -- they've got the 2012 vehicles in operation. They can't make that shift that quickly. It's a matter of practical ability, to get it into the production cycle.
We don't go as high as the underlying bill does. I'm a great supporter of renewable fuels, ethanol, biodiesel, all of those things. But quite frankly, there is a limit to how much we can produce in the United States that is from crops grown in our country.
So I think we need to be realistic. We have a standard of 50 percent by 2015.
LEVIN:
Actually, I think that we actually retain the 50 percent that's in the underlying bill. We were going to go higher than that, and that was where a problem existed, with at least one of the foreign auto makers.
STABENOW:
Just an interesting fact that Rick Wagoner spoke about last week, from General Motors, when we had a manufacturing summit here -- he said that, if every vehicle on the road that was using -- could use E85, today, and everyone, by 2012, when they say they will be having at least half of their vehicles E85, flex-fuel -- if everyone had access to E85, we would be saving more oil than anything we're talking about in CAFE, which is why the whole question of infrastructure, and, frankly, the farm bill that we're working on right now, and the other incentives in Finance are so important.
LEVIN:
And also the provision in here that prohibits anti- competitive barriers that limit the ability of service station retailers to sell biofuels. We have that in here, too, for the same reason.
QUESTION:
Why did you cut off ramps (OFF-MIKE)?
LEVIN:
Because our numbers, we believe, are achievable. It's a stretch. And since we believe those are achievable, don't think off ramps are needed or appropriate.
The Feinstein bill does have off ramps because there's some honest doubt in the minds of people who've supported it that those numbers were achievable and they, very understandably, put in off ramps in that circumstance. And, frankly, I'm glad they did.
But we'd rather have numbers that are a stretch, that we believe can be achieved, even though there's some doubt in the auto industry on the subject, but since we believe that, we thought that there was no need for off ramps.
QUESTION:
(OFF-MIKE)
LEVIN:
That's going to be said by NHTSA.
STABENOW:
There are interim -- yes, it does ramp up. That's part of all the details that we'll have to (inaudible). But it does ramp up.
QUESTION:
Senator, have you had any talks with the administration about (OFF-MIKE)? Are they going to sit on the sidelines? And if it passes, will they accept it?
BONDS:
I've had some discussions. I have no -- I cannot speak for the administration. They're aware of it. And I'll let them speak for what -- if we can pass this, you can be sure I will work on trying to convince them.
STABENOW:
I was in one meeting...
(CROSSTALK)
STABENOW:
I'm sorry. I didn't mean to interrupt.
One meeting with a group of senators and the president a while back talking specifically about energy (inaudible) he was speaking broadly. His own proposals in the State of the Union were really broad goals.
(CROSSTALK)
BOND:
I don't foresee a problem.
LEVIN:
But I think the administration position continues to be that they oppose mandatory numbers legislated. They believe that they should be set by an expert agency such as NHTSA rather than set by Congress. And I assume that remains their position, but I agree with Senator Bond and Senator Stabenow that we would be hopeful that if we can get this passed that we could persuade the administration that these are, while a stretch, that these are achievable numbers.
OK. Thank you all.
STABENOW:
Thanks so much.
BOND:
OK. Thank you very much.