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Federal Government Must Hold Automakers Accountable, Demand Real Fuel Efficiency

Nov. 6, 2008 

Federal Government Must Hold Automakers Accountable, Demand Real Fuel Efficiency

Statement of Joan Claybrook, President of Public Citizen*

Beginning today, automakers can apply for guaranteed loans from the U.S. Department of Energy (DOE) under a program to help the industry produce more fuel-efficient vehicles. While we could debate the prudence of spending taxpayer money to revamp and improve the auto industry’s manufacturing plants, we’ll focus instead on making sure the $25 billion already set aside for this program is not wasted.

The DOE released the rule for the program Wednesday night. We believe the regulation does not go far enough in safeguarding the public’s investment.

The auto industry allowed itself to get into this predicament by fighting against every attempt to improve the fuel economy of its fleets. Instead, the industry was intent on producing the biggest, most impractical, least fuel-efficient vehicles it could. Each year, automakers raised the level of ridiculousness even higher, turning out an even larger version of last year’s fuel-guzzling sports utility vehicle or light truck.

Now, as Detroit struggles to find its place in the marketplace, it is incumbent on the DOE to demand accountability.

The DOE should not provide loans to upgrade plants that produce performance vehicles. Producing a more fuel-efficient, luxury sports car is akin to providing an alcoholic light beer. It makes no sense.

Under last year’s Energy Independence and Security Act, Congress gave the DOE the authority to administer the loan program. Congress required that vehicles made in improved plants achieve a 125 percent increase in fuel economy compared to those produced there in a baseline year. The DOE should adjust the baseline upward each year, instead of using the single baseline year of 2005.

The federal government is giving automakers a chance to save themselves. In return, the industry has a responsibility to the public – one it can fulfill by not forcing more of these unsafe, gas-guzzling SUVs and light trucks on the American motorist.

*Note: Joan Claybrook was administrator of the National Highway Traffic Safety Administration from 1977-1981.