Press Release

Big Three Say Federal Regs Won't Provide Market for Electric Vehicles

09/16/96

Mandate Will Not Assure the Success of Electric Vehicles

WASHINGTON, Sept. 12 -- The following is a statement by
Jerry Esper, Director of Vehicle Environment at the American
Automobile Manufacturers Association:

Jerry Esper

AAMA

September 12, 1996

New York City Council

I am Jerry Esper, Director of Vehicle Environment at the American
Automobile Manufacturers Association -- a trade association
representing the domestic automakers -- Chrysler, General Motors, and
Ford. Thank you for the opportunity to discuss your resolution and
opportunities New York has to achieve cleaner air for its citizens.

As you know, the California Air Resources Board (CARB) modified the
California Low Emissions Vehicle (LEV) regulations to eliminate the
ZEV mandate for 1998 through 2002 model years. This action was based
on a study conducted by a panel of battery experts appointed by the
CARB, who concluded that advanced batteries that could deliver the
range and affordability required for electric vehicle success would
not be commercially available until the 21st century. But it also
reflected a recognition of the risks of a ZEV mandate to the success
of electric vehicles -- the risks of mandating the sale of electric
vehicles that do not meet the expectations of the vast majority of
customers, coupled with an inadequate infrastructure -- and concluded
that the 1998 mandate will likely poison the future market for
electric vehicles rather than enhance it.

In addition to these factors, electric vehicles in the Northeast face
the additional hurdle of cold weather. One of our member companies
found that their electric vehicle's range when operating in severe
weather in the Northeast was reduced to 12 miles to a
recharge. Independent studies in the Northeast have concluded that ZEV
mandates endanger the success of electric vehicles. A study conducted
by the New York State Energy Research and Development Authority
concluded that "vehicle range and costs, associated primarily with
battery performance, will most likely continue to be an impediment to
electric vehicle competitiveness with gasoline-powered vehicles
through the study period (1994-2004)."

AAMA believes that New York is legally obligated under the federal
Clean Air Act to at least conform its ZEV regulations to those as
amended by California. In passing federal legislation, Congress
explicitly directed that there be no more than two vehicle emissions
programs -- federal and California -- in recognition of the need for
uniformity in major consumer products that cross state and regional
lines. We would hope that New York would go beyond amending its
resolution to conform to California and eliminate its ZEV mandate
entirely in recognition of the technical barriers remaining to its
commercial success especially in the extreme climate in New York and
of the substantial manufacturer programs in place that are pushing
this technology as fast as possible. Each of our member companies over
the past year has announced production plans for electric
vehicles. The question is not whether they will be produced, but how
best to assure a future market for these vehicles.

The 49-state LEV program which the auto industry has volunteered for
the Northeast region would address the goals of cleaner air and
advanced vehicle technology in this state. This program has been found
by EPA to provide superior air quality benefits both to the Northeast
and to the rest of the country, at lower costs than the current New
York program. As part of that program, automakers have agreed to offer
a full range of advanced technology vehicles for the Northeast states
and to meet annually to determine how best to encourage sales of such
vehicles and the necessary accompanying infrastructure. We are working
hard to deliver this program for New York.

Mandates will not assure the success of electric vehicles. California
recognized that when it decided to eliminate a 1998 mandate. A mandate
to produce EVs without a market or infrastructure to support the EV
will lead to its failure, not success. The domestic automakers urge
you to set aside this resolution. The best path to cleaner air and the
availability of a broad range of alternative fueled vehicles in New
York is not a mandate, but the 49-state LEV program.