Detroit and Washington: what's next?

Washington - Not much happened impacting the auto industry as the Republicans wrapped up their first 100 days in control of Congress.

But, that's about to change. As Speaker Newt Gingrich wields his budget axe to slim down, if not eliminate, federal agencies, President Bill Clinton tries to keep a step ahead by ordering the agencies to conduct their own reviews and come up with proposals to run leaner.

Both efforts are converging this month and next, and they will go a long way toward shaping the future of automotive regulations and government-funded major programs such as the Partnership for a New Generation of Vehicles (PNGV).

That's the consensus of several experts who gathered here in April for the Society of Automotive Engineers (SAE) annual government/industry meeting.

Two factors will shape the outcome: Congressional budget-cutting, which may be especially brutal at the Environmental Protection Agency (EPA) and Department of Energy (DOE), and Mr. Clinton's reviews, which aim to eliminate, revise and simplify existing regulations and cut red tape in adopting new rules. The outcome could mean relief for automakers from the strict emissions mandates laid down in the Clean Air Act, although that's not a certainty.

While the EPA faces major downsizing - even EPA officials concede that's very likely in the cards - the National Highway Traffic Safety Administration (NHTSA) may escape relatively unscathed.

Dr. Ricardo Martinez, NHTSA administrator since last August, strongly suggests at the SAE meeting that his agency already is taking major steps to become more cost-effective. He anticipates a 25% reduction in the agency's 650-person staff over the next few years, largely through buyouts averaging $25,000 each.

Whatever happens, NHTSA won't curtail efforts to reduce fatalities and injuries, he underscores, adding that the agency's next thrust will be evaluation of proposals to reduce head injuries and to standardize safety labeling on cars and trucks.

The PNGV, or "Supercar," program may face some tough going. The program currently is funded at $380 million, of which $250 million is channeled through the DOE. IT's a joint research project combining the forces of federal agencies and labs with the U.S. Big Three automakers through the U.S. Council for Automotive Research (USCAR).

PNGV makes sense for a lot of reasons. One is to reduce U.S. reliance on foreign oil, although that's also a reason for questioning the project: Fuel is expected to remain cheap in the U.S. during the foreseeable future. Another is to keep government labs busy now that the Cold War has ended. And if successful, it could give the U.S. a competitive edge in world markets during the next century.

Ron York, a General Motors Corp. engineer and USCAR participant in the PNGV project, says test data is scheduled for completion by 1997 and full capability work completed by 2004. Most likely a hybrid/electric powertrain will be used, he tells the SAE session, adding that the vehicle's recyclability bogie has been raised to 80% from 75%.

"None of it theoretically is impossible," he says. "The problem is bringing it all together. It's either a system engineer's dream - or nightmare."

But Mr. York and others admit PGNV may become vulnerable when weighed against political and economic trends sweeping Washington these days. "A whole lot of people don't understand it. They think most of the funds are going to the Big Three, but in fact most are going to suppliers. We've got to talk to people in a non-politicized environment."

Will the Supercar program make the cut, he's asked? "I think it's winable," Mr. York replies.

Separately, Dr. Martinez says he's "happy" Chrysler decided to voluntarily recall more than 3 million minivans to install stronger tailgate latches in response to mounting criticism. The No. 3 automaker is setting aside $115 million for the campaign.

Asked why NHTSA has not set standards for minivan liftgate latches, Dr. Martinez says requirements covering other vehicle doors may be extended to minivan rear doors. The existing rules, he emphasizes, were promulgated when station wagons were popular. "You don't see too many station wagons anymore," he observes. "A lot of the regulations came in the 1960s, and some are technically restrictive" based on today's designs, he says, citing strict headlamp mandates that subsequently have been changed as one example.

Clearly looking for a closer relation with automakers, he unveils a slick new NHTSA logo with the accompanying slogan, "People Saving People," and comments: "We hope to show you don't need regulations on top of regulations. Sometimes strict standards reduce (opportunities for) continuous improvement."