Special Coverage

Management Briefing Seminars

TRAVERSE CITY, MI – The bad blood between the auto industry and the U.S. Congress is made painfully clear in David Cole’s remarks at the Management Briefings Seminars here.

Cole, the funny, friendly, intelligent dean of the briefings, says of Congress: “It is dysfunctional in terms of economics, technology and long-term strategic thinking.”

Noting Congress only has a 14% approval rating, “they deserve that low standing,” he says. “It is a dysfunctional organization that is trying to run our country.”

Both presidential candidates promise legislation to address climate change, and 16 states – it soon could be 22 – want to regulate carbon-dioxide emissions from cars.

Mike Stanton, CEO of the Association of International Automobile Manufacturers, says whether presumptive candidates Sen. John McCain or Sen. Barack Obama becomes the next president, the auto industry will face tougher rules.

McCain long has championed a 40-mpg (5.9 L/100 km) corporate average fuel economy rule, and Obama recently called for a 50-mpg (4.7 L/100 km) standard.

The industry probably wouldn’t care what the rules are if they get time to develop the technology and if the direction is clear.

The big problem now, says Stanton, is that the Environmental Protection Agency, National Highway Traffic Safety Admin. and 16 states allied with California all are making or proposing rules that would affect the industry in different ways.

California has the backing of 218 representatives among the 435 in the House of Representatives, and six states thinking about joining would add 56 more votes.

It isn’t clear whether Stanton thinks it is a good or bad thing, but he expects Democrats to pick up four to six Senate seats and 10-20 House seats in November. He also expects the EPA to give California the right to regulate CO2.

The industry hates the idea of having more than one set of fuel-economy rules in the country.

Stanton is clear in saying he doesn’t think the auto industry will get any help from the Supreme Court if Obama is elected and has the chance to appoint justices to replace the three who are close to retirement.

All three voted with the 5-4 majority saying the EPA must decide if the Clean Air Act gives it the responsibility to regulate CO2 emissions. Stanton believes the Obama appointees also would vote the same.

“I hope that whatever passes has one national standard, and there is one agency to tell us what to do,” he tells attendees, while asking the industry to get involved.

“Congress needs (to know) what you know about the industry,” Stanton says. “It is very difficult to educate 435 members.”