DETROIT – The National Automobile Dealers Assn. backs federally mandated improvements in fuel economy, but not measures it considers “unreasonable,” such as a Senate bill calling for a 35-mpg average by 2020.
Instead,supports a House bill from Rep. Baron Hill (D-IN) and Rep. Lee Terry (R-NE) targeting fuel economy for cars and light trucks at 32 mpg (7.35L/100km) to 35 mpg by 2022 (6.72L/100 km).
“That’s a 40% increase over the current standards,”Chairman Dale Willey tells the Automotive Press Assn. here.
“These are aggressive targets, and they will be a challenge for auto makers,” he says. “But Hill-Terry gives manufacturers enough lead time to develop technologies needed to meet the new standards.”
NADA helped get that bill rolling.
Hill-Terry had only six co-sponsors when first introduced. Then NADA organized a “fly-in” to Washington, so dealers could meet face-to-face with their legislators.
“We carried forward one simple message: Hill-Terry is the only bill that calls for responsible CAFE (corporate average fuel economy) reform,” Willey says. “Within 15 legislative days, the bill had more than 120 co-sponsors. Now, I’m proud to say, there are 170.”
The lobbying by dealers has slowed down “irresponsible, knee-jerk legislation” that would hurt the auto industry and the nation’s economy, he adds.
Willey is a Buick-Pontiac-GMC-Cadillac dealer in Lawrence, KS. As someone on the front line of the auto industry, he worries that overly stringent fuel-economy standards might lead to products the public isn’t interested in.
“We agree the U.S. must become less dependent on foreign sources of oil,” he says. “We also agree with the goal of reducing CO2 emissions. But a boost in CAFE can accomplish these goals only if consumers buy the new, more fuel-efficient vehicles.
“And there is no guarantee they will,” he says. “For example, light trucks have outsold cars for the last five years. Drastic government mandates could force auto makers to build cars that the American consumer will not buy.”
That could spark a “jalopy effect,” Willey says, meaning “car owners will simply hold onto their older, less fuel-efficient cars.”
He opposes raising federal taxes on gasoline as a way of nudging consumers into more fuel-efficient vehicles. “Gasoline is expensive enough already,” he says.
Despite the current problems of domestic auto makers, the auto industry as a whole remains strong, Willey says. “In fact, the past eight years have been some of the best in history for the U.S. automobile retail business.”
A self-described optimist, Willey says the woes currently facing the Detroit Three and domestic-brand dealers such as himself offer a chance to “transform problems into opportunities.”
“Loss of market share and higher gas prices create an opportunity for the auto industry to reinvent itself,” he says. “Those higher prices create an opportunity to design and sell more fuel-efficient vehicles.”
It is important to remember the auto industry is cyclical, Willey says, noting history indicates an auto maker that is up today could be down tomorrow – and vice versa.
“The very weakness in the current U.S. auto industry could make a rebound all the stronger,” he says.
The son of a dealer, Willey has been a new-car dealer since 1970.
Coincidentally, he opened his GM-brand dealership on the first day of a long national United Auto Workers strike against GM.
The strike shut down production. Unable to restock, Willey eventually saw his new-vehicle inventory disappear. Then he all but cleared out his used-car stock.
“It got so bad that, at one point, I was down to one used-car on the lot. It was a lime-green ‘69 Buick Wildcat Coupe. I was forced to learn fast how to survive during hard times.”
Lessons learned as a young dealer included “how to minimize costs, maximize service and think creatively,” he says.