Car Makers Face Fuel Economy Fight

Car Makers Face Fuel Economy Fight

After a year of touting their efforts to make cars and trucks more environmentally friendly, U.S. automakers will face two thorny disputes in 2001 — fuel economy and emissions — that could threaten their green credibility.

"This was the year that fuel economy got put on the table," said Jason Mark, transportation director for the Union of Concerned Scientists. "The key question is how the auto industry deals with it in the coming year."

Ford Motor Co. made a big splash in July when it announced a plan to improve the fuel economy of its sport utility vehicles by 25 percent over five years. Ford's claim riled executives at General Motors Corp. enough that the world's largest automaker came out a week later to say it too would improve the fuel economy of its SUVs.

"GM will be the leader in five years, or for 15 years or 20 years," vice chairman Harry Pearce said. "We have spent years achieving this leadership position. And I think it's extremely important that when we talk about fuel economy, we talk about deeds, not words."

GM, Ford and DaimlerChrysler all announced plans to build trucks with hybrid electric power within a few years — Ford with its Escape small SUV, GM with a full-size pickup and DaimlerChrysler with its Dodge Durango SUV.

And the Big Three all showed off prototypes of cars with mileage of 70 to 80 miles per gallon — at the same time, highlighting how far such exotic vehicles are from production.

"We really believe we can be good corporate citizens for the environment and give customers what they want," said Ford CEO Jacques Nasser earlier this month.

But the companies also fought efforts to raise federal fuel economy standards that were last set in 1975. GM, Ford and the Chrysler side of DaimlerChrysler struggle to meet the Corporate Average Fuel Economy requirement that their light-truck fleets average 20.7 miles per gallon because of the thirsty — and highly profitable — large pickups and SUVs.

After years of banning consideration of higher standards, Congress approved a study of tougher fuel economy regulations by the National Academy of Science that is scheduled to be completed next year. Mark and other environmentalists said that study could open the door for an increase in fuel economy standards in a few years.

"I think the auto companies recognize that their days without improved CAFE standards are numbered," said Daniel Becker, director of the Sierra Club's global warming and energy programs. "Maybe they bought some more time with a Bush administration, but that's not clear."

The first deadline looming for the auto industry is Jan. 25, when the California Air Resources Board will consider changes in rules requiring that zero-emission vehicles make up 4 percent of annual sales by 2003.

While automakers have touted hybrid vehicles powered by a gas engine and an electric motor, the board has ruled that only totally electric cars meet the zero-emission requirement. That would mean automakers would have to sell about 22,000 electric cars a year in California to meet the standards or face a $5,000 fine on every vehicle they sell there.

Automakers have long contended there's no market for battery-powered cars — last year, they sold 1,277 nationwide. Environmentalists say automakers aren't making a real effort to sell and build electrics.

The board's proposed changes would cut the number of zero-emissions vehicles required to about 4,650, and let automakers count hybrids toward the 4 percent goal. But the proposal has satisfied neither side.

The Alliance of Automobile Manufacturers, an industry group composed of 13 manufacturers, has proposed a market test of electric vehicles in one city with the goal of measuring how much demand exists. Gloria Bergquist, a spokeswoman for the group, said the new proposals are slightly better, but also add pressure by lessening clean-air credits on some vehicles.

"The way we look at it, they have one foot on the brake and one on the accelerator," she said.

Mark said CARB was wrong to back away from its mandates, and said the automakers would find a market for battery-powered vehicles if they built enough of them.

"Their posture on this is going to be important from an environmental perspective," he said.

Copyright 2000, Associated Press. All Rights Reserved.