CAFE on wheels slowed

US CAR-makers have reacted angrily to the US Senate's passing of a new national energy bill that includes a significant tightening of Corporate Average Fuel Economy (CAFE) standards.

In what’s being described as a compromise deal to tighten the average fuel consumption of all new vehicles sold in the US, but which comes as a major blow to the embattled Amercian car-makers who had described the proposal as unworkable, just before midnight last Thursday (June 21) the US Senate voted 65-27 to pass the Senate approved a single new CAFÉ standard of 35 miles per gallon (6.72L/100km) by 2020.

That’s up 40 per cent from today’s standards of 27.5mpg (8.55L/100km) for cars and 22.5mpg (10.45L/100km) for trucks.

General Motors vice-chairman Bob Lutz couldn’t contain his anger about the new CAFE bill, which he told The Detroit News was aimed at hurting the big American car-makers.

"This is purely punitive the 'big business haters' finally giving us our due for decades of 'colluding with oil companies' and 'forcing the US public to buy big SUVs. Make no mistake: these people hate us and want to inflict pain." "This whole thing has nothing to do with energy policy, CO2 or the environment," Lutz told the newspaper.

As part of the amended energy bill, provisions to lower the average consumption figure by four per cent each year after 2020 were scrapped, as was a $US29 billion ($A34) tax incentive package for alternative fuel producers and plug-in hybrid vehicle owners.

Both technologies had been promoted as alternatives to tighter CAFE standards by US car-makers, which have successfully lobbied against lifting CAFE standards for almost three decades and recently engaged in an emotional publicity campaign to back its cause.

If approved by the US House of Representatives, which is currently backing a different energy bill without such fuel economy requirements, the Senate bill will still have to avoid veto by president George W Bush, who has said he doesn’t approve of specific mileage numbers, before it can be enacted into law.

It is unclear when the House will take up the issue, with estimates in the US media ranging from next month to this September.

Most of the companies that make cars in America are choosing their words carefully when discussing the bill, which also requires ethanol production be increased to 36 billion gallons a year by 2022, but are clearly worried about how much it will cost them.

GM sales, service and marketing vice president, Mark LaNeve, told AP that GM was struggling to see how it could comply with the new CAFE proposal.

"There's no way you can get those numbers without a dramatic shift in consumer choice," he said. "We don't know how it's attainable." Chrysler Group CEO, Eric Ridenour, told AP that the company might have to stop selling some of its larger vehicles.

"Clearly the larger family-sized vehicles will be the ones that will be most at risk," Ridenour said.

"The end result will be lighter, smaller vehicles in general." Ford Motor Company was putting on a brave face in light of the senate decision, with president Alan Mullally stating at the launch of the new Taurus model that better fuel economy was "what customers want".

However, the company’s vice-president of government affairs, Bruce Andrews, later told Reuters the company was not happy with the bill in its current form.

"Major changes are still needed to make this bill achievable," he said.

The concern is not limited to the ‘Big Three’ from Detroit, with Toyota Motor Corporation describing the new CAFE standard as "extreme" and a "very aggressive target", according to International Business Times.

Perhaps sensing a change was on the cards, the American car-makers had backed a move led by Michigan senator Carl Levin that would see cars achieve and average of 36mpg fuel economy by 2022 and light truck mileage of 30mpg by 2025. It failed to gain significant support.

Earlier this month and before the senate passed the CAFE legislation, GM communication vice-president, Steve Harris, told GoAuto that the Holden G8 export plan and Holden-developed rear-drive models would go ahead regardless of the outcome of CAFE debate.

He did, however, warn that GM would face a tough task to meet new CAFE rules, if introduced, into the future.

"But it is a concern to us what is going on from a CAFE and CO2 discussion in the United States and some of the proposals look unbelievably difficult to achieve," he said.

Chrysler buffs up

THE US Senate’s approval of the new CAFE standards has overshadowed a pro-active plan announced by Chrysler Group last week that will cut the fuel consumption of its vehicles.

The company outlined a raft of technology initiatives ranging from clean diesels, mild hybrids, petrol engine efficiency gains and weight reduction measures for Chrysler, Jeep and Dodge models.

It is unclear whether which of the technologies will be made available for right-hand-drive markets, but Chrysler Group Australia told GoAuto it would push for any new efficient features that would be introduced overseas.

Chrysler Group is still steering clear of a full petrol-electric hybrid, instead announcing plans for a mild hybrid powertrain "in the next few years".

The system, which features regenerative braking, would switch off the engine at idle to save fuel and use a battery to power accessories.

Chrysler Group also announced plans for a Bluetec clean diesel Jeep Grand Cherokee to go on sale next year and was considering introducing a four-cylinder diesel in the US.

It also announced that its new range of Pheonix V6 petrol engines planned for 2010 will feature cylinder deactivation technology.

Chrysler Group has also outlined a new dual-clutch transmission, similar in concept to the Volkswagen DSG automatic, to be developed in partnership with Getrag.

It said preliminary testing of the transmission suggested it could yield fuel savings of up to six per cent.

The fuel saving initiatives were announced a day after Chrysler Group said it was planning to boost its international sales by expanding its dealer networks in markets outside North America.

Chrysler Group president Tom La Sorda said that the company would aggressively defend its position in the US, but added "it is important that we expand in other markets so that we are not as dependent on the ups and downs of a single region," he said.