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Automakers Grilled In US Senate Hearing On Fuel Efficiency January 30, 2007

Posted by notapundit in Congress, Politics, US News.
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WASHINGTON (AP)–Members of the Senate energy committee want automakers to produce more fuel-efficient vehicles to help the industry weather the impact of higher gas prices and improve their long-term fortunes.

“Maybe we need to help you help yourself by pushing these standards,” Republican Sen. Gordon Smith, R-Ore., said during a hearing by the Energy and Natural Resources Committee.

Representatives of General Motors Corp. (GM), Honda Motor Co. (HMC) and other automakers said the government could help foster advanced technologies and improvements in hybrid batteries through a mix of tax incentives and funding for research.

Some lawmakers appeared resistant to that approach, saying the industry had placed too much of a premium on building large sport utility vehicles that are less fuel-efficient than passenger cars.

“It seems like we are expected to do so without very much in return in the form of higher efficiency standards by the industry, and I think this is a shared responsibility,” said Sen. Robert Menendez, D-NJ.

Menendez asked whether General Motors supported tougher requirements under the government’s Corporate Average Fuel Economy system, or CAFE. GM’s Beth Lowery said recent changes to the rules for pickup trucks and SUVs helped create a fairer system, and the company was “willing to look at car CAFE reform as well.”

“It is a very complex subject, and it’s very difficult to just pick a number,” Lowery said. A Honda representative said the company supported fuel economy increases through performance requirements.

President George W. Bush, seeking a 20% reduction in gasoline consumption in 10 years, has proposed boosting alternative fuels and reforming the nation’s fuel economy standards for passenger cars. He also would impose stricter gas-mileage requirements on automakers, about 4% annually.

Many members of Congress, however, want a numerical increase in fuel-economy standards and are hesitant to give the administration the broad authority to reform the passenger car system. The hearing reflected a growing interest among many lawmakers for the tougher standards.

The system for new passenger cars, which requires the fleet to have an average of 27.5 miles per gallon (11.7 kilometers per liter), has been virtually unchanged during for two decades. Sen. Pete Domenici, R-NM, said the system had been stuck in “years of deadlock while we could have been making real progress as new technologies became available.”

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