Special Coverage

Management Briefing Seminars

TRAVERSE CITY, MI – Instead of battling Washington at every turn, auto makers are moving toward a more proactive role on such issues as safety and energy policy, says Dave McCurdy, president and CEO of the Alliance of Automobile Manufacturers.

The former Oklahoma congressman, who joined the AAM in February, describes his role in a presentation at the Management Briefing Seminars here “as an honest broker between the companies and Washington.”

AAM members include General Motors Corp., Ford Motor Co., Chrysler LLC, Toyota Motor Corp., BMW AG, Mazda Motor Corp., Mitsubishi Motors Corp., Porsche AG and Volkswagen AG.

McCurdy joined the association just as the fight over future corporate average fuel economy regulations was heating up following President Bush’s State of the Industry declaration that the administration would push for a 4% improvement annually starting in 2010.

That target later was determined unfeasible and dropped, but since then several bills have been proposed in the Senate and House of Representatives to boost CAFE in both cars and light trucks.

So far no consensus has been reached. The AAM has lobbied to maintain separate standards for cars and trucks, which for decades have called for 27.5 mpg (8.5 L/100 km) for cars and 22.5 mpg (10.4 L/100 km) for trucks. Current bills propose up to 36 mpg (6.5 L/100 km) for cars and 30 mpg (7.8 L/100 km) for light trucks.

“We support an increase in fuel-economy standards, but it has to be reasonable in relation to (the impact) on the American economy and protect American jobs,” he says.

Although the AAM obviously backs potential federal legislation the auto makers can meet without undue upheaval or expense, McCurdy says the association is increasingly concerned about actions by state governments having a major impact on auto makers.

He says there are a whopping 5,600 bills pending in all 50 states that in some way would regulate auto makers. As a result the AAM has lobbyists in all states, plus offices in Sacramento, CA, and Detroit “to address these issues,” he says. The AAM also is backing global standards on issues such as emissions and alternative fuels.

McCurdy says he’s often asked why GM can’t provide cars that get 42 mpg (5.6 L/100 km) in the U.S. as it does in Europe.

“People don’t understand the differences in the markets,” he says. Fuel-saving diesel engines are a tiny percentage of cars sold in the U.S. compared with more than 50% in Europe, a penetration rate motivated by a fuel tax that is $1 higher per gallon on gasoline than diesel.

U.S. buyers likely would buy more flex-fuel vehicles, but only 1,200 among 170,000 service stations carry the fuel, McCurdy says.

Auto makers also support vehicle-safety legislation in Congress and have taken the initiative in several areas, including adding side airbags and anti-rollover systems, he says, although they’ve received very little credit.

Still, “I think you’ll see our image improving,” McCurdy predicts.