Fuel Economy Hit 22-Year Low

By DANNY HAKIM

DETROIT, May 2 — The average fuel economy of the nation's cars and trucks fell to its lowest level in 22 years in the 2002 model year, the Environmental Protection Agency reported today.

The technological and engineering leaps of the last two decades have been poured into everything but fuel economy, according to the agency's statistics. Since 1981, the average vehicle has 93 percent more horsepower and is 29 percent faster in going from 0 to 60 miles an hour. It is also 24 percent heavier, reflecting surging sales of sport utility vehicles.

But over the same period, fuel economy has stagnated, contributing heavily to the nation's rising oil consumption. Cars and light trucks — S.U.V.'s, pickups and minivans — account for about 40 percent of the nation's oil consumption and a fifth of its carbon dioxide emissions, which many scientists see as the leading contributor to global warming.

Environmentalists, frustrated by years of legislative defeats and a recent retreat by the Ford Motor Company on a pledge that it would improve the fuel economy of its S.U.V.'s, were further exasperated by the report.

"Without being forced to improve fuel economy by the government, the auto industry doesn't do it," said Daniel Becker, the top global warming expert for the Sierra Club. "Congress has to require energy savings in the energy bill that comes to the floor next week or the auto industry will continue to go in reverse."

The report also said that fuel economy could have improved 33 percent since 1981 if performance and weight of vehicles had been held constant.

But Gloria J. Bergquist, the vice president for communications at the Alliance of Automobile Manufacturers, the industry's chief political lobbying group, said the industry could not force consumers to buy fuel-efficient vehicles.

"We have 30 models that get over 30 miles per gallon, but the top 10 most fuel-efficient vehicles are less than 2 percent of sales," she said. "I would call this report a consumer sales report. It shows what consumers are buying."

In his first speech today as the new chairman of General Motors , Rick Wagoner, who will continue to serve as chief executive, said "the only solution to this tough dilemma of improving fuel economy and reducing emissions in the intensely price-competitive and very low-cost-energy environment here in the U.S. is through technology."

He singled out the potential of hydrogen-powered fuel cells, a clean energy source, which have been a favorite technology of the Bush administration. But many analysts say fuel-cell cars are years, if not decades, away from mass production.

The E.P.A. report came several months later than usual and was somewhat controversial because the agency changed its normal reporting procedures. Instead of reporting only fuel economy changes for the 2002 model year, weighted for sales, the agency also included results for the 2003 model year based on the industry's own sales projections from last September.

By that reckoning, average fuel economy will show its first improvement in more than two decades in the 2003 model year. But the agency said there was a margin for error large enough to swing the results to a loss. And sales trends this year have also not appeared to favor energy conservation.

Light trucks continue to gobble up more of the market than more fuel-efficient passenger cars. Sales of the biggest S.U.V.'s, like the Lincoln Navigator and the Chevrolet Suburban, rebounded from a sluggish first quarter with a strong showing last month.

Further worsening fuel economy statistics are the aggressive moves by Asian automakers into S.U.V.'s of all sizes, with the next battleground being drawn over the last stronghold of Detroit, the pickup truck.

In the 2002 model year, fuel economy averaged 20.4 miles a gallon, the lowest since the fleet averaged 19.2 miles a gallon in 1980. Fuel economy peaked at 22.1 miles a gallon in 1988 but has mostly fallen since.

The agency predicts fuel economy will rise to 20.8 miles a gallon in the 2003 model year, with a 0.5 mile a gallon margin for error. Cars are expected to average 24.8 miles a gallon, compared with 19.6 for minivans, 17.8 for S.U.V.'s and 16.8 for pickups.

David Friedman, a senior policy analyst for the Union of Concerned Scientists, said the report's new methodology "raises a lot of questions."

"I'm very skeptical of their use of the 2003 model year information," he said, adding that "it's difficult to come to any conclusions about any model year before the model year is over."

Conversations with people at the environmental agency who were briefed on the decision to offer 2003 figures indicated that it was not politically motivated but was done in part to prevent news organizations from doing their own projections.

Donald Zinger, the assistant director of the E.P.A.'s office of transportation and air quality, said "some people tried to do it themselves and got all messed up and came out with numbers that were inaccurate."

San Jose Mercury News Perspective section Sun, Jun. 15, 2003

By Tom Adams

At first blush, it may be tempting to list environmental policy as just another example of a cultural divide that exists between California and President George W. Bush, whose political support is strongest in the Plains, the Rocky Mountain West and the South. Polls show that Californians part ways with the Republican president on a number of issues, including abortion, medical marijuana and gun control.

But environmental policy is different -- it has a different history. Over the years, Sacramento has frequently upstaged the power, authority and influence of Washington. From controlling auto pollution to developing renewable power, many states have followed California, not Washington.

While opposition from industry to environmental policy has been routine, previously California has enjoyed the benign neglect or even the blessing of Washington. With the Bush administration's pro-industry stance, however, California is facing off against not just industry but also the nation's capital. This uneasy new chapter in California's history as an environmental leader raises the stakes for the state's role as a pioneer.

The most recent issue to showcase the gulf between California and federal policy makers was sparked by the Bush administration's New Year's Eve repeal of Clean Air Act regulations that required industries to install state-of-the-art air-pollution-control equipment when they built or modernized factories.

The action triggered a firestorm. Fourteen states, including California, and several environmental groups have filed suit to overturn the repeal. In the U.S. Senate, a bill to restore the repealed program came surprisingly close to passing.

On June 2, California's Senate passed a bill by Sen. Byron Sher, D-San Jose, that adopts the old federal program as a state statute. (The federal act allows states to adopt air-quality measures for factories that are more stringent than federal law.) The measure is expected to come before the Assembly Natural Resources Committee later this month, and if it passes the Assembly and is signed by Gov. Gray Davis, it would represent another California challenge to Washington.

Once again, other states may follow California's lead, though this time Washington may fight back: The administration is threatening to force California to accept its proposals for weaker pollution controls.

Historical context

California's leadership role dates back to the smoggy '60s. As Los Angeles basin residents began to battle smog, the federal 1967 Air Quality Act granted California authority to set and enforce its own emissions standards for new vehicles.

When President Nixon signed the Clean Air Act in 1970, it was modeled to a large extent on California programs, especially California's efforts to make car exhaust cleaner. That act allowed all states to set standards for vehicles that were stricter than federal standards. Over the years, other states, especially in the Northeast, have followed California's standards, together creating such a large market that the automobile companies, despite vehement protests, manufacture cars for the whole country that meet those standards.

Then in 1990, President George H.W. Bush signed a set of amendments that strengthened the federal air act. With that move, California became the designated leader. California could still adopt emission standards stricter than federal standards; other states could adopt only measures as strict as California's but not stricter.

In California, those tougher standards have paid off. To cite just one measure: In 2000, the air pollution from vehicles was 200,000 tons per year less than a decade earlier, even though vehicles traveled 40 billion miles more per year.

Well aware of California's special position, the Bush administration is trying to undermine it. The federal Environmental Protection Agency has, for example, proposed lower levels of automobile pollution, but not levels as low as California's. The catch is that any state that would accept the lower pollution levels offered by the administration must waive its rights to set pollution levels as low as California's. Since New York and Massachusetts have so far insisted on their right to follow California, the support required for California's deanship is apparently being retained for now.

On another front -- protection of its coastline -- California also parted ways with the Eastern Seaboard in 1972. In that year California voters passed Proposition 20 to create the California Coastal Commission, which conducts the most comprehensive coastal-protection program in the United States. Because of its efforts, development has been limited, allowing millions of travelers to enjoy the rugged coastlines at such places as Big Sur and Marin. It's a dramatic difference from much of the Eastern coastline, where preservation has not been nearly as successful.

Leadership, though, is never without a test, and there is a case pending in the California Supreme Court challenging the constitutionality of the way commissioners are appointed.

New threats

California's leadership role faces new threats despite national polls showing strong bipartisan support for environmental progress. The Bush administration, populated with former oil and auto executives and free-market advocates, is working hard to unravel past gains. The examples are myriad, from repudiating the Kyoto accord on global warming and pushing for drilling in Alaska, to canceling wilderness areas and allowing snowmobiling in Yellowstone.

Consider the rejection of the Kyoto accord. The president said the treaty would retard economic growth (perhaps mostly the growth of the oil, gas and coal industries). In any event, the action left the United States sidelined in global negotiations over strategies to reduce global warming -- until California took action on its own.

In 2002, after a fight with the auto companies and their allies, the Legislature passed a bill by Assemblywoman Fran Pavley, D-Woodland Hills, authorizing the California Air Resources Board to adopt auto-emissions standards to reduce global warming.

When Davis signed the bill last summer, it made headlines as far away as London and New Delhi. Other states, including New York, are considering following California's lead. And Germany has reached across the United States to invite the secretary of the California Environmental Protection Agency to make a presentation to an international conference this summer on California's program to address global warming.

The auto companies threatened a ballot referendum on the Pavley bill, but the threat evaporated. Litigation is expected, though, when the state's Air Resources Board eventually adopts emissions standards for global-warming gases.

The divide between Washington and Sacramento also became evident last year after a bill by Sen. John Kerry, D-Mass., to require 10 percent of electricity generated by the nation's utilities to be renewable by 2020 could not get a majority vote in the U.S. Senate.

Its fate in the more conservative House was doubtful in any event, given the belief by a majority in the House that markets, not regulation, should determine the fuels that electricity generators use.

Then in August, California enacted legislation that requires 20 percent of the electricity from California utilities to be generated from renewable sources by 2017.

Litigation results

On other fronts, recent litigation results have favored California's position. The Bush administration lost a lawsuit filed by Davis to ensure that California keeps a voice in decisions about offshore oil drilling; and an industry challenge to the state's ban on MTBE, a gasoline additive that helps keep the air cleaner but pollutes water supplies, was just defeated this month. In both cases, courts upheld the state's historical right to protect its own environment.

For a state often lampooned as embracing a culture of immediate gratification, California's environmental policy embodies a long-term outlook, a position repeatedly reinforced by voters across the board. Elections in 2000 and 2002, for example, underscore voters' priorities. Voters authorized $8 billion for parks and water bonds, together representing the largest resource bonds approved in the history of the United States.

Significantly, the support for these bond measures reflected the state's diverse demographics. Exit polls conducted for Proposition 40, passed in March 2002, showed that the proposition was supported by a majority of whites (56 percent), Asian-Americans (60 percent) and Latinos and African-Americans (both at more than 70 percent).

With popular support for the environment at these levels, Washington will face long battles if it continues to try to undermine California's leadership.

TOM ADAMS (thradams@ earthlink.net) is president of the board of directors of the California League of Conservation Voters, an environmental organization based in Oakland and Los Angeles. He wrote this article for Perspective.
http://www.detnews.com/2003/autosinsider/0306/17/autos-195826.htm

Tuesday, June 17, 2003 Detroit News Auto Insider

Toyota, which has sold 140,000 cars with engines driven by a combination of gas and electricity since 1997, plans to release a larger, faster and cleaner version of the Prius hatchback later this year. "We will release hybrid sport-utility vehicles in the next two to three years," Cho told Bloomberg News in a television interview at Toyota's fifth environmental forum in Tokyo.

The maker of the Harrier/RX330 sport-utility needs to expand its model range and cut prices to attract more customers in the $2.5 billion hybrid vehicle market, which Credit Suisse First Boston Japan Inc. expects to triple by 2006. The Prius now costs about $3,000 more than a gasoline-engine car.

"To make their green cars successful there are two main objectives, which are meeting emission regulations and offering lower prices," said Masayuki Kubota, who helps manage the equivalent of $8.5 billion at Daiwa SB Investments Ltd. "Once they are met, sales of hybrids will surge."

Toyota, which wants to raise its global share to 15 percent early next decade from 10 percent in part by offering customers more hybrid models, was the first automaker to release autos with gasoline-electric engines for commercial sale, starting with the Prius in 1997.

The new Prius is expected to go about 55 miles per gallon for average city and highway driving, up from 48 miles in the current version.

Toyota shares, which have risen about 13 percent in the last three months, rose 1.6 percent to 3,090 yen in Tokyo.

Releasing Hybrids

Toyota's release of gasoline-electric sport-utilities may give it a promotional edge over rivals in a vehicle class that's drawn criticism from environmentalists for wasting energy.

The world's third-largest automaker by sales will continue to increase profits from hybrid cars, Cho said, without providing detail. He added the automaker is ready to start installing hybrid systems in other models. There may be two to three different versions of the current hybrid system, he said without elaborating.

"It will help Toyota if it offers a wider range of models to be able to supply a variety of customers," said Endo.

Delaying Targets

Endo estimates the owner of a mid-sized hybrid car, driving about 3,000 kilometers in the city and highway a year, may save about 3.5 million yen ($29,746) in a four year period.

Toyota sells three hybrid models including the Prius sedan, Estima minivan and Crown luxury car. The automaker said in January that it will release a hybrid version of the RX330 in the U.S.

Toyota's gasoline-electric system emits as much as 40 percent less carbon dioxide than traditional internal-combustion engines. Rival Honda Motor Co. , Japan's No. 2 automaker, released its Insight hybrid car in Japan and the U.S. in late 1999.

Cho said the automaker's earlier plan to sell 300,000 hybrid cars annually by 2005 may be delayed by a year.

"The Japanese government is driving luxury cars such as the Century and Celsior sedans, while Toyota has released a mid-sized hybrid car and is planning to release a sport-utility version," Cho said. As a result Toyota "quickly reviewed" plans on model releases to meet customer demands, he said.

Cho, who acknowledges the cost of making cars greener can be prohibitive, said the company "will be offering" the technology as long it makes business sense.

Supplying Technology

He said "nothing has been decided" on supplying hybrid technology to other companies. These include Renault SA, Nissan's alliance partner, PSA Peugeot Citroen, which Toyota is working on building smaller cars and General Motors Corp. , with which it cooperates in environmental technology.

"Greener cars won't spread if it's only Toyota that uses the technology," Cho said.

Research and development costs are likely to "slightly go up" even as the company trims costs as it needs to continue developing new technologies to be ready for changes in the market, Cho said.

Toyota is forecasting research and development costs will increase by 2.7 percent to 690 billion yen ($5.9 billion) in the year ending March 31, 2004.

Marketing Fuel Cells

Cho said Toyota's on track to lease 20 fuel-cell vehicles, which use only electricity, by the end of this year in Japan and the U.S.

Toyota and Honda were the first two automakers to market fuel- cell hybrid vehicles and have started leasing their models to governments, companies and universities in Japan and the U.S. since December.

Fuel cells, used for decades in spacecraft, make electricity by combining hydrogen and oxygen, with only steam or water as a byproduct. High costs and a lack of hydrogen fuel stations limit the technology to small test programs, analysts said.

The company had to repair six hydrogen-powered fuel cell passenger vehicles after one of them leaked hydrogen refilling its high-pressure fuel tank. Toyota had to postpone the delivery of an additional six fuel-cell cars to energy companies and governments in Japan because of the fault.

"We have been able to spot the problem," Cho said. "We just needed to change one part."

The automaker will return four of the vehicles to the Japanese government at the end of this month, Toyota spokesman Shinya Matsumoto said in the afternoon in Japan. The company will return two others to U.S. universities at a later date.

June 28, 2003

By DANNY HAKIM

Larger vehicles, the argument goes, may guzzle more gas but they offer more protection, whether one hits a tree or another car. The argument has been a central one when efforts emerge in Congress to raise fuel economy standards. And it is taken seriously by the Bush administration, which has started an effort to rewrite the fuel economy rules.

The problem with this argument is that it now has little relationship to the American road. As safety advocates point out, the lightest cars have virtually disappeared from American roads over the last 15 years, while the largest vehicles — including sport utilities and pickups — have ballooned, both in number and heft.

The portion of cars that weigh 2,500 pounds or less, which was 18 percent of all passenger vehicles sold in the 1985 model year, has fallen to less than half a percentage point, according to the Environmental Protection Agency. In fact, the average American car has been steadily gaining weight for a decade and a half.

Over the same period, the growth of the largest vehicles has only expanded weight differences that are widely acknowledged to be deadly in collisions. Moreover, the largest vehicles are increasingly not cars but sport utilities and pickups, which ride much higher than cars, increasing the danger to people in cars and the likelihood of deadly rollovers.

When the government created fuel economy regulations after the energy crisis of the early 1970's, few imagined they would become a flashpoint because of an entirely different issue — safety. But the official the Bush administration has chosen to preside over the effort to rewrite the rules, John D. Graham, says saving lives is as important as saving gasoline.

Dr. Graham, the regulations administrator of the Office of Management and Budget, has argued since his years as a Harvard professor and risk expert that fuel regulations have cost thousands of American lives because cars were made too light — in Detroit, the phenomenon is called downsizing. Auto lobbyists have cited Dr. Graham's work, and other research, in opposing tighter fuel standards.

Now Dr. Graham is chairman of an intra-agency group rethinking the fundamental structure of corporate average fuel economy regulations, or CAFE standards, for light trucks — sport utility vehicles, pickups and minivans — for the 2008 model year and beyond. The group also includes the National Highway Traffic Safety Administration, whose chief, Jeffrey W. Runge, will play a central role; the Energy Department; and the E.P.A.

Dr. Graham said in an e-mail exchange that the administration's intention was "to stimulate more fuel-saving, technological innovation while protecting safety and American jobs."

He said he did not want to press automakers to make most light trucks lighter. "CAFE reform does not make sense if it forces consumers to purchase vehicles that are lighter or smaller than they need," Dr. Graham said.

But he also said, somewhat surprisingly, that there were problems with vehicles that are too heavy: "A downsizing of the heaviest light trucks could be a net positive."

He said the country would be better served by less diversity in vehicles, in terms of weight and size. In effect, he is playing to both sides of the debate, arguing that bigger is better — but that too big is not better.

Now he faces the difficult task of selling his ideas.

"The curious thing about the administration's effort on this proposal is that it is opposed by all of the major stakeholders, by the U.A.W., the environmental groups and by the major automakers," said Alan V. Reuther, the top lobbyist of the United Automobile Workers union.

The union fears that domestic automakers will abandon production of smaller cars under a Bush plan and focus on their profit center: sport utility vehicles and pickups.

Automakers expressed a range of views, but always concern.

"What the auto industry and other industries support about Dr. Graham is that he does strive to base decisions on sound data and sound science, and that's a mantra of business," said Gloria Bergquist, spokeswoman for the Alliance of Automobile Manufacturers, the industry's main lobbying group.

"But when he's starting to take on changes to CAFE, it makes us nervous because it's very complicated and it's something that we've wrestled with for 30 years."

The notion of Dr. Graham's presiding over the debate is anathema to environmentalists, who doubt that conserving gasoline will be a priority, and safety groups, who do not trust him because the Harvard Center for Risk Analysis, which he founded, was partly financed by automakers.

"It's clear he's doing this on behalf of the auto industry," said Joan Claybrook, president of Public Citizen, a consumer advocacy group and a critic of Dr. Graham.

She said the effort should be led by the agency she once ran, the National Highway Traffic Safety Administration. "That's why they create these agencies," she said.

Dr. Runge, the traffic agency's current administrator, has a leading role because his agency actually writes the regulations, though Dr. Graham has used his power in the budget office before to reject a tire pressure regulation proposed by the traffic agency.

The two men seem closer to the same page on the weight debate. Dr. Runge called Dr. Graham "a very valuable player in helping the administration navigate through this thorny issue."

"This is very important to the future of the country," he added. "It may seem arcane outside of Washington, D.C., but it affects everybody in our nation."

Fuel regulations are so strewn with loopholes that several auto lobbyists said they preferred "the devil we know."

Today, each automaker's fleet of passenger cars is required to average 27.5 miles per gallon. Light trucks are required to average 20.7 miles per gallon. The Bush administration has already raised that figure, to 22.2 by the 2007 model year.

But the system allows automakers to assume their vehicles are about 18 percent more fuel-efficient than they actually are. They also get special credits for making some vehicles that can substitute ethanol for gas even though few customers realize they have such an ability.

The largest sport utilities and pickups, those with a weight greater than three tons, are not even part of the regulatory system. That means automakers do not have to count many Hummers, Toyota Land Cruisers or Lincoln Navigators, to name a few.

Perhaps the ultimate quirk is that regulations meant to save gasoline led the auto industry to dump the station wagon, because it qualifies as a car, and create new classes of family haulers, like sport utilities, that qualify as light trucks. As a result, the fuel economy of the average new passenger vehicle is at its lowest point in 22 years.

But many automakers and their allies have long argued, and continue to argue, that saving gasoline kills.

Tough regulations would "exchange body bags for oil barrels," Jerry Curry, the top auto regulator during the first Bush administration, said in 1990. In 1999, Michigan's senators, Carl Levin and Spencer Abraham — Mr. Abraham is now the energy secretary — wrote to colleagues that higher CAFE standards would equal more vehicle deaths because cars would be made too light.

Last year, to ward off another attempt to raise fuel standards, the industry ran advertisements suggesting farmers would be forced to haul hay with subcompacts and warning: "Fuel economy is important. Safety is vital." Trent Lott held up a picture of a tiny European Smart car on the Senate floor — it was purple — to warn that Americans would be forced to drive such Lilliputians.

Sam Kazman, general counsel for the Competitive Enterprise Institute, which has sued the government to halt even small regulatory increases, said in a recent statement that fuel regulation "kills thousands of people each year by forcing vehicles to be downsized and therefore less crashworthy."

But Clarence M. Ditlow, director of the Center for Auto Safety, said Mr. Kazman "has no argument on small cars because the small cars have gotten bigger."

"When you look at today's fleet, manufacturers have not met the regulations by making small cars," he added, but by improving technology.

Mr. Ditlow argues that safety problems could be alleviated — and gasoline saved — if the separate standard for light trucks were scrapped. But the industry has blocked several efforts to do so.

On average, cars have been gaining weight for a decade and a half, to 3,408 pounds today from 3,013 pounds in 1987. Some additional weight has come from new safety systems like air bags. Car weights have consolidated at 3,000 to 4,000 pounds — a trend that on its own would help safety because cars are more alike in terms of weight than they were 30 years ago.

If the lightest cars have vanished, so have the behemoths of Motor City's last heyday — the two-and-a-half-ton Lincolns and the battleship station wagons. Even after bulking up in recent years, passenger cars are below the 4,071-pound average of 1975.

Large cars have been supplanted by light trucks, which have grown to more than half of sales today from a fifth in 1980. Sport utilities and pickups are gaining faster than cars, to 4,569 pounds today from a low of 3,840 in 1987, increasing the weight disparity on the roads.

The industry's arguments were bolstered by a 2001 National Academy of Sciences report, which said that cars being made too light caused 1,300 to 2,600 deaths in 1993.

But the finding drew dissent from two of the academy's panelists, and Charles Lave, an economics professor at the University of California at Irvine who was a primary architect of the finding, said much had changed since 1993.

"It's a description of the past," he said. "You can get a 20 to 40 percent improvement in fuel economy without decreasing weight. You don't have to decrease performance either. The technology exists to do it."

"There's no reason you should get an increase of deaths," he added.

The administration is likely to submit several ideas for public comment this summer, mostly variations on a system that would mandate light truck fuel efficiency in terms of weight or size classes instead of a single mileage target, several people who ae close to the deliberations said.

Environmental groups say such a system will nullify fuel economy gains. The administration, however, is considering bringing Hummers and Land Cruisers into the regulatory system and effectively creating a heavyweight class like one suggested in the National Academy's report, with a somewhat demanding mileage target to stem further auto obesity.

"My intention is to seek wide public comment on this topic to the point of public meetings," Dr. Runge said.

http://www.bayarea.com/mld/mercurynews/6272863.htm
Smog tops list of worries

MOST SURVEYED ARE WILLING TO PAY MORE FOR TOUGHER AIR STANDARDS

By Paul Rogers

Mercury News

Posted on Thu, Jul. 10, 2003

The typical California resident thinks like a Sierra Club member but drives an SUV.

That's one of the top messages in a new poll released Wednesday that shows Californians rank smog as the most serious environmental problem facing the state -- and are willing to pay to correct it. Yet fewer than half are concerned their own vehicles pollute too much.

Californians love the environment, and they love their cars,'' said Mark Baldassare, research director at the Public Policy Institute of California, a non-partisan San Francisco research organization that conducted the poll.

But there are some conflicts between people's lifestyle choices and their environmental preferences.''

Still, the telephone poll of 2,002 residents taken in June revealed that Californians aren't necessarily oblivious or hypocritical when it comes to the environment.