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Major Automakers Spurred by California Standards

Rather than bemoaning California’s tougher fuel standards, Honda and Chrysler executives embrace change.
January 21, 2009

Major automakers such as Honda and Chrysler are realizing that it’s time to throw away the old game plan and chart a new one around the sale of smaller, more fuel-efficient vehicles. Ironically, some of the most direct evidence of this changed thinking lies buried at the end of an otherwise apologistic report on the U.S. auto industry’s troubles in the L.A. Times earlier this week.

The L.A. Times story reports on a likely forthcoming waiver from President Obama’s EPA effectively allowing states to demand better fuel economy than the federal CAFE standard. After declaring this a “nightmare scenario for automakers,” the article delivers desperate quotes from General Motors and the Alliance of Automobile Manufacturers–the trade group that fought (unsuccessfully) to block California’s standards in court. A GM spokesperson sets the tone, saying that subjecting a depressed industry to these tough standards is like asking a cancer patient to “finish chemo and then go run the Boston Marathon.”

Here’s an alternative bedside analogy that looks to a deeper cancer: setting lower standards than the European Union and China are already phasing in is reminiscent of the fatalistic approach to cancer treatment in which doctors hid from their patients the full extent of their sickness. If a carcinoma eats the auto industry from within, it is surely its own denial of the imperative need to provide radically cleaner transportation solutions–a subspecies of what President Obama on Tuesday called “our collective failure to make hard choices and prepare the nation for a new age.”

Which brings us to the L.A. Times article’s buried gem, in which Ed Cohen, Honda’s vice president for government affairs, makes the most of the last word. Cohen reports that Honda has been expecting Obama to unleash California’s regulators and is laying plans for “a fleet far more efficient than even that called for under the California rules”:

“We’re setting a pattern for the future,” Cohen said. “Any company that is not assuming a constant rate of improvement in fuel economy and carbon emissions is making a big mistake.”

Detroit’s engineers may, too, be preparing real change, rather than counting on their lobbyists and Washington gridlock. Consider what one Chrysler executive told the online electric-vehicle-oriented publication EV World at last week’s Detroit auto show. Bill Moore, EV World’s editor, writes in his “EV World Insider” column this week that the unnamed executive credited the impending California standards as a key driver of Chrysler’s recent EV epiphanies. (There’s no link to those quotes just yet, as Moore’s column is premium content; nonsubscribers can read here in about a month or, of course, subscribe.)

Peter Fairley, an independent journalist and editor of the Web journal Carbon-Nation, tracks energy innovation around the globe, from the solar-powered villages of Bolivia’s Cordillera to China’s mechanizing coalfields.

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