FIRST THE gain, now the pain. The US auto industry received a $17.4 billion bailout in December from the outgoing US administration and has its sights set on further financial support from the Obama administration. In return they have committed to clean up environmentally. President Obama is clearly determined to enforce that promise.
The US Congress has already passed legislation to increase average fuel consumption in the US to 35 miles per gallon (American measurements) by 2020. The current standard is 27.5mpg for passenger cars and 22.5mpg for pick-ups and SUVs. Such an improvement may seem relatively minor, but in the last 10 years the average fuel economy for cars on the US market has improved by just 2.6mpg.
The new standards do not address carbon dioxide emissions directly, but such emissions will be reduced as vehicles are forced to become more fuel efficient. They could also be overshadowed by another announcement by President Obama: his intention to review a decision that blocks California and 13 other states from setting their own more stringent standards.
California has sought to impose higher emissions standards on cars since 2002. Other states have followed its lead. The proposals would roughly translate to a standard of 43mpg being imposed for cars sold in the most populous state in the US. Representing 10 per cent of all US auto sales, any standards set there cannot be ignored by the car industry. Add in the car markets in other states sure to follow California’s lead and you start to understand why the struggling US car giants are publicly baulking at the challenges ahead.
For too long US buyers have ignored their duty to the global environment. While other regions, most notably Europe, attempted to grasp the challenge of reducing fuel consumption and emissions, the US continued to ignore the impact of its love affair with big-engine gas-guzzlers. Even the supposedly tough new California standards would only bring it roughly into line with current EU targets. In December the EU committed to reducing average car emissions to 130g/km by 2015, with a further 10g/km cut coming from other factors like tyre improvements. This would equate in American measurements to an average fuel economy figure of between 47mpg and 52mpg. Through smarter engineering and simple changes like weight-savings and smaller engines, these targets are achievable. If Europe can do it then the US has no excuse.