Lutz Not Happy with Changing Fuel Economy Rules

[Variance]

Lutz Not Happy with Changing Fuel Economy Rules

A proposal to increase the U.S. fuel economy standards would force Detroit-based automakers market to "hand over" the market for trucks and sport utility vehicles to Japanese manufacturers, a senior General Motors Corp.(NYSE:GM - news) executive said.

Bob Lutz, GM's vice-chairman and the head of the company's global product development team, said the proposed changes to the government's Corporate Average Fuel Economy (CAFE) standards would represent an unfair burden on the traditional Big Three automakers.

"For one thing, it puts us, the domestic manufacturers, at odds with the desires of most of our customers, namely larger vehicles," Lutz said in a year-end posting on a Web site maintained by GM.

He added: "That effectively hands the truck and SUV market over to the imports, particularly the Japanese, who have earned years of accumulated credits from their fleets of formerly very small cars."

Lutz, a long-time critic of government fuel economy regulations, compared the attempt to force carmakers to sell smaller vehicles to "fighting the nation's obesity problem by forcing clothing manufacturers to sell garments only in small sizes."

Yahoo

Original GM Fastlane blog entry

[Satty]

You've made you bed, now lie in it.

Sure, its not Lutz' fault that GM was dependant on gas guzzlers for the last 30 years preventing them from picking up the types of credits other have, but he should be thinking more about meeting the standards than bitching about them since its unlikely they'll be changed.

[ellives]

You've made you bed, now lie in it.

Sure, its not Lutz' fault that GM was dependant on gas guzzlers for the last 30 years preventing them from picking up the types of credits other have, but he should be thinking more about meeting the standards than bitching about them since its unlikely they'll be changed.

Not really.

Get the idiots in congress out of the business issues. They have no business telling the car industry what they should be building. Miraculously these things work themselves out without government lackies sticking their useless noses into it. When the supply of gas gets tight, the price goes up and people buy smaller and more efficient vehicles. There is no need for CAFE standards or anything like it.

[thegriffon]

You've made you bed, now lie in it.

Sure, its not Lutz' fault that GM was dependant on gas guzzlers for the last 30 years preventing them from picking up the types of credits other have, but he should be thinking more about meeting the standards than bitching about them since its unlikely they'll be changed.

It's not about GM being dependent on gas guzzlers in the past, it's about other automakers not offering larger vehicle the public wanted until now. If they're going to change the rules they need to wipe the slate clean, so that credits earned by not building large vehicles in the past can't be used to build large vehicles in the future, which would be counter-productive. They need a "use them or lose them" approach.

[ellives]

It's not about GM being dependent on gas guzzlers in the past, it's about other automakers not offering larger vehicle the public wanted until now. If they're going to change the rules they need to wipe the slate clean, so that credits earned by not building large vehicles in the past can't be used to build large vehicles in the future, which would be counter-productive. They need a "use them or lose them" approach.

It's simpler to tell the government to get lost.

[Robert Hall]

It's simpler to tell the government to get lost.

Not going to happen...companies have to work within the regulations.

[thegriffon]

Another way of looking at it (and a better one for persuading the green left)—Toyota and Nissan make a full range of vehicles, from compacts through to large trucks, but for various reasons including much worse fuel economy, no-one wants to buy lare trucks from Nissan and Toyota. This leaves them with a large surplus in CAFE credits, with which they can subsidize the price of their less-efficient, unpopular large trucks, to the detriment of the domestic manufacturers who build more fuel-efficient and more popular trucks. Not ony does this distort the market, but it does so to the detriment of the nation's fuel economy. Instead of subsidizing the production of small vehicles, it ends up simply subsidizing the most unpopular models of gas guzzlers.

[pow]

It's not about GM being dependent on gas guzzlers in the past, it's about other automakers not offering larger vehicle the public wanted until now. If they're going to change the rules they need to wipe the slate clean, so that credits earned by not building large vehicles in the past can't be used to build large vehicles in the future, which would be counter-productive. They need a "use them or lose them" approach.

Yes. How about ONE car from GM that gets 30 old-EPA MPG city. GM's Tahoes and Enclaves are gorgeous, but their small offerings are nowhere as sought after or appealing. An iconic "car for all people" (MINI, Prius) would be great... Ford has the opportunity with their "Model T" name.

[siegen]

Despite what the alarmists may think, we don't have any magic 100-mpg carburetor that we're holding back because we're in bed with the oil companies.

Carburetor? :AH-HA_wink:

Lutz compared the attempt to force carmakers to sell smaller vehicles to "fighting the nation's obesity problem by forcing clothing manufacturers to sell garments only in small sizes."

Except most people don't choose to be fat, a lot do choose to drive a V8 powered vehicle for the image when a Nissan Versa would suit them perfectly fine. GM is simply giving the public what they demand, if they didn't somebody else would (*cough*Toyota*cough*). However, if the government wants to, as Lutz put it, force people into smaller cars, maybe GM should focus more on meeting the new demand, then trying to keep things the way they were.

What's GM's excuse for the Chevrolet Aveo being so sub-par? The media can bash them all they want and everyone can claim bias, but the media doesn't make the Toyota Yaris average 35.2 mpg while the Aveo only averages 29.7 mpg. GM needs to stop importing a damn Korean car and rebadging it, they need to build a more-than-competitive Aveo that gets leading fuel economy.

[thegriffon]

Take for example Suzuki—the company only makes small vehicles and thus has a good CAFE, but as a result it can't subsidize sales of smaller more fuel-efficient vehicles, and has no incentive other than markert pressure to produce the most efficient vehicles in it's segment. As a result it's small vehicles are more expensive, and use larger, less fuel-efficient engines, neither of which furthers the purpose of the CAFE standards. CAFE simply breaks down when an automaker doesn't offer a full mix of products that are equally popular in all segments. It assumes that a company which produces the most popular large trucks also builds the most popular subcompacts, which is patently ridiculous. It has political support because no-one wants to be more direct and tax fuel at a higher rate, or put registration and sales taxes on fuel-economy and CO2 emissions. Averaging does not work. Instead of making a broken system even more skewed, it's time it went away altogether.

[regfootball]

somehow there needs to be incentive to make vehicles lighter and more fuel efficient, but i support everyone's right to buy as large a car as they want or need. some people need a Saturn Outlook or Suburban. Most folks transportation needs would in no way be served by a little $h!box like a Fit or Versa. Not to mention how they would be dogmeat if they so much as scrape the curb.

[siegen]

Most folks transportation needs would in no way be served by a little $h!box like a Fit or Versa. Not to mention how they would be dogmeat if they so much as scrape the curb.

lol

[ellives]

(...snipped...)

What's GM's excuse for the Chevrolet Aveo being so sub-par? The media can bash them all they want and everyone can claim bias, but the media doesn't make the Toyota Yaris average 35.2 mpg while the Aveo only averages 29.7 mpg. GM needs to stop importing a damn Korean car and rebadging it, they need to build a more-than-competitive Aveo that gets leading fuel economy.

The question of why the Aveo is "sub-par" is complicated. The bottom line is GM wanted something in the segment. Given their pension and healthcare burden they couldn't afford to develop their own so they bought something. It may not be class leading but it's in the segment. They opted to put their money into developing new GMT-900's.

[loki]

The question of why the Aveo is "sub-par" is complicated. The bottom line is GM wanted something in the segment. Given their pension and healthcare burden they couldn't afford to develop their own so they bought something. It may not be class leading but it's in the segment. They opted to put their money into developing new GMT-900's.

the astra can't come fast enough, among other euro cars destined for our shores. the hybrid trans will help, but can anyone wait till the diesels proliferates the roads (given ULS fuel is everywhere)

[Drew Dowdell]

Except most people don't choose to be fat...

right.... that double bacon cheeseburger and fries march up to people's office every day and forces itself down their throats.....

[Camino LS6]

The concept of credits should be tossed in the crapper along with the concept of corporate AVERAGE fuel economy standards. If we are to have standards at all, they should be set for each class of vehicle across the board. Let's quit the social engineering attempt and just set standards ALL manufacturers must meet. A level playing field.

The idea of tax credits for consumers who choose fuel-efficient models (in each segment) as well as those powered by alternative fuels does make sense to me. Let's not restrict choice, just reward choices that have a fuel conservation/environmental impact benefit to all.

[CARBIZ]

...or Washington could double the gasoline tax to match the Rest of the World. Why is it that only in North America (or Saudi Arabia, for that matter!) do vehicles like the Expedition or Tahoe sell at all! Isn't it interesting that farmers in Germany and Australia survive with smaller, more fuel efficient trucks for their operations?

I agree that CAFE ratings are silly, but Washington needs to do something and to think Detroit (or Tokyo) will voluntarily cut back production of gas guzzling trucks is equally silly. High gasoline taxes are the only proven method of influencing buyer decisions, or why else would the Rest of the World buy vehicles like the Vectra, Corsa, Ka, Fit, Uno, etc. but not on this side of the ocean?

[Robert Hall]

...or Washington could double the gasoline tax to match the Rest of the World. Why is it that only in North America (or Saudi Arabia, for that matter!) do vehicles like the Expedition or Tahoe sell at all! Isn't it interesting that farmers in Germany and Australia survive with smaller, more fuel efficient trucks for their operations?

Apples to oranges..Expeditions, Tahoes, Suburbans and other obese SUVs generally aren't used by farmers in the US but families in suburbia.. they are the modern equivalent of the big family station wagons of the past. As long as we have cheap gas, a nation of obese people will continue buying obese vehicles...

[Camino LS6]

Increased taxes are a very bad idea for a number of reasons, especially in a nation like the US. Ultimately, the solution lies elsewhere. Viable alternative fuels as well as a diversification in the types of fuels used would have a greater impact than taxes or requirements foisted upon the manufacturers.

We simply have to stop wringing our hands about how "impossible" it is to create an infrastructure to distribute these fuels and do it already.

[CARBIZ]

Double the gasoline tax (obviously not over night or it would create a recession!), pay down the federal deficit with the proceeds (or do you think Iraq is going to pay for itself?) and help get America off the dependency of oil bought from terrorists. Look at what Russia is doing with natural gas these days? Do you not think Germany and France are getting nervous? Energy as an economic weapon - what a concept! Most of America's foreign oil (60% is imported these days) is coming from crazy countries like Venezuela and the Middle East. Does Mexico look stable these days? Canada can only pump 2 million barrels a day and we need a lot of that ourselves, so we can only be of so much help if Venezuela or the Middle East goes (more) postal.

[Dragon]

Except most people don't choose to be fat

that sir is stupid comment. while a small percentage of obese people are pretty much screwed into being fat by their genes, 99.9% of obese people are so because they choose not to watch their caloric intake and/or choose not to exercise if their caloric intake is too high.

I have no problem with the government raising CAFE, I do think that automakers being able to use fuel economy fleet credits from the past is BS. The slate SHOULD be wiped clean

Edited December 27, 2006 by Dragon

[thegriffon]

...or Washington could double the gasoline tax to match the Rest of the World. Why is it that only in North America (or Saudi Arabia, for that matter!) do vehicles like the Expedition or Tahoe sell at all! Isn't it interesting that farmers in Germany and Australia survive with smaller, more fuel efficient trucks for their operations?

I agree that CAFE ratings are silly, but Washington needs to do something and to think Detroit (or Tokyo) will voluntarily cut back production of gas guzzling trucks is equally silly. High gasoline taxes are the only proven method of influencing buyer decisions, or why else would the Rest of the World buy vehicles like the Vectra, Corsa, Ka, Fit, Uno, etc. but not on this side of the ocean?

That's nice, but except for all except the best compact trucks, GM's large pickups are just as fuel efficient, or even more so, than smaller. lighter, lower power compact trucks. When the dual-mode hybrids and then the light-duty diesel arrive, the fuel-economy equation will change again. Face it, under CAFE GM has far more incentive to improve the mileage of the GMT 900s than anyone does for compact trucks. You have to wonder how much better fuel-economy a Colorado would get if they dumped the Atlas engines for Gen IV Vortec V8s.

[siegen]

99.9% of obese people are so because they choose not to watch their caloric intake and/or choose not to exercise if their caloric intake is too high.

Just because they don't do a good job exercising or watching what they eat doesn't mean they're choosing to be fat. For a lot of people, their path is laid down when they are a kid, and they are at the mercy of what/how much their parent's feed them, or how much motivation their parents gave them to get off the computer! The kids don't choose to be fat, they are at a very influence-able age, and they may be stuck with it for the rest of their life unless they have enough willpower to make a change (which can be hard in a society where fast food is plentiful and at every turn).

But what I'm referring to is how Lutz attributed the "government forcing small cars onto people" to "clothing makers forcing small clothes". It just doesn't work. It doesn't take a significant amount of work to sell or trade in your large vehicle for a smaller one. However, a fat person trying to get fit will take months or even years of hard work and a complete change in their eating and living habits.

[thegriffon]

that sir is stupid comment. while a small percentage of obese people are pretty much screwed into being fat by their genes, 99.9% of obese people are so because they choose not to watch their caloric intake and/or choose not to exercise if their caloric intake is too high.

I have no problem with the government raising CAFE, I do think that automakers being able to use fuel economy fleet credits from the past is BS. The slate SHOULD be wiped clean

Even people with "fat genes" just have the higher tendency to put on weight. Diet and exercise, both within their control, have a far greater impact. I'm a little tubby myself, but I acknowlegde that with more exercise and better diet I could be much thinner.

[Carguy]

So the INTERNATIONAL plan continues to come together!---This is ONE MORE THORN in the side of GM by the globalist government/media complex! Bash American products with Comsumer Reports and a BIAS media while distroying their effectiveness with unions and public belief in (SO CALLED) oil company CONSPIRICIES! Then REGULATE the American makers to an INPOSIBLE and QUALITY KILLING LEVEL while continueing to BASH AWAY at American ENGINEARING! The day will come when there will NO LONGER be any AMERICAN owned and RUN automobile's made in this Country!----WELCOME TO GLOBALISM!----Welcome to the FUTURE DOWNFALL of this ONCE GREAT COUNTRY by some of those INTERNATIONALISTS who somehow STILL are allowed to clame they LOVE IT!

[sciguy_0504]

You've made you bed, now lie in it.

Sure, its not Lutz' fault that GM was dependant on gas guzzlers for the last 30 years preventing them from picking up the types of credits other have, but he should be thinking more about meeting the standards than bitching about them since its unlikely they'll be changed.

Worth repeating.

[Drew Dowdell]

Just because they don't do a good job exercising or watching what they eat doesn't mean they're choosing to be fat. For a lot of people, their path is laid down when they are a kid, and they are at the mercy of what/how much their parent's feed them, or how much motivation their parents gave them to get off the computer! The kids don't choose to be fat, they are at a very influence-able age, and they may be stuck with it for the rest of their life unless they have enough willpower to make a change (which can be hard in a society where fast food is plentiful and at every turn).

That's called shifting the blame. The Cheeseburger didn't attack the fat guy and shove itself down his throat. You can't blame your own lack of willpower on your parents.

[Dragon]

Just because they don't do a good job exercising or watching what they eat doesn't mean they're choosing to be fat. For a lot of people, their path is laid down when they are a kid, and they are at the mercy of what/how much their parent's feed them, or how much motivation their parents gave them to get off the computer! The kids don't choose to be fat, they are at a very influence-able age, and they may be stuck with it for the rest of their life unless they have enough willpower to make a change (which can be hard in a society where fast food is plentiful and at every turn).

Ya they are choosing to continue being fat once they hit adult hood by eating the way they eat. I know, I was one of those fat kids, and even though I knew it was bad (kinda hard not to these days), I continued to choose to eat that way and eventually got up to 350. Then I chose to get my fat ass to the gym and in just over a year I had dropped 100lbs

[haypops]

I would like to argue against this and some much more devastatingly unfair posts.

Even people with "fat genes" just have the higher tendency to put on weight. Diet and exercise, both within their control, have a far greater impact. I'm a little tubby myself, but I acknowlegde that with more exercise and better diet I could be much thinner.

If an individual were to consume one slice of bread more than required each day, by the time he/she were 45 they would be 360 pounds overweight. Not just weigh 360 pounds, but actually be 360 pounds more than their normal weight. How hard is it not to guess wrong by one piece of bread. Well a piece of bread is 75 calories and a typical diet is perhaps 1500 calories. That is an error of just 5%. Are you less than 5% inaccurate in your school studies, your cruising speed on the highway, your parallel parking requirements? Probably not.

I know of people who participate in 12 step programs for both alcoholism and obesity. They will tell you that alcohol abstention is much easier than body weight to control. Sociological studies have shown that obese black women suffer much more discrimination because of their weight than there race. Unless you have a Ph.D. in biochemistry like I do, cut the fatties a little slack.

To bring this back on topic; I suspect that Lutz was issuing a preemptive strike against the gas mileage credits will have little trouble getting this changed to GM's and the environment's betterment.

[thegriffon]

Dude, that extra slice of bread doesn't matter for one day, but unless you have no sensory perception at all you have to see very quickly that you're eating too much and not getting enough exercise. It's a fairly simple feedback loop that requires only willpower and discipline. Hmm, I've put on another 10 lbs, I'd better cut back on the treats and get out and exercise more.

[siegen]

Ya they are choosing to continue being fat once they hit adult hood by eating the way they eat. I know, I was one of those fat kids, and even though I knew it was bad (kinda hard not to these days), I continued to choose to eat that way and eventually got up to 350. Then I chose to get my fat ass to the gym and in just over a year I had dropped 100lbs

I agree with you. Back to my original point. People don't choose to be fat for the image. However, a lot of people do drive V8 powered cars and full-size SUV's for that reason, the image. Lutz's saying people being fat and people buying gas-guzzlers are the same, is just him trying to use metaphors that he's hoping people won't understand and just go along with.

[thegriffon]

All he's saying is that forcing companies to make something doesn't mean that people will buy them.

[Mr.Krinkle]

I would like to argue against this and some much more devastatingly unfair posts.

If an individual were to consume one slice of bread more than required each day, by the time he/she were 45 they would be 360 pounds overweight. Not just weigh 360 pounds, but actually be 360 pounds more than their normal weight. How hard is it not to guess wrong by one piece of bread. Well a piece of bread is 75 calories and a typical diet is perhaps 1500 calories. That is an error of just 5%. Are you less than 5% inaccurate in your school studies, your cruising speed on the highway, your parallel parking requirements? Probably not.

I know of people who participate in 12 step programs for both alcoholism and obesity. They will tell you that alcohol abstention is much easier than body weight to control. Sociological studies have shown that obese black women suffer much more discrimination because of their weight than there race. Unless you have a Ph.D. in biochemistry like I do, cut the fatties a little slack.

To bring this back on topic; I suspect that Lutz was issuing a preemptive strike against the gas mileage credits will have little trouble getting this changed to GM's and the environment's betterment.

I dont know what kind of bread you eat but 1 pound = 3500 calories. You either eat that much to gain a pound or burn that much to lose one or a combination works best. You can just cut that much out and lose too. That works out to about 500 calories per day. 2 cokes and that coffee roll perhaps. I only have a minor in health/nutrition though so I could be wrong. Im not, though. Look it up if you want.

And the best way to regulate is to tax the gas and not the OEMs. People will think twice before buying that large truck or 4x4 and maybe choose more wisely.

If the govt wants to but in it should be arbitrary. They shouldnt but if they do keep it at a level playing field...no one wants to win on a technicality. Wheres the honor in that?

[haypops]

I dont know what kind of bread you eat but 1 pound = 3500 calories. You either eat that much to gain a pound or burn that much to lose one or a combination works best. You can just cut that much out and lose too. That works out to about 500 calories per day. 2 cokes and that coffee roll perhaps. I only have a minor in health/nutrition though so I could be wrong. Im not, though. Look it up if you want.

Your 3500 calories/pound is the generally accepted value. A slice of bread is 75 calories x 365 days/year x 45 years/3500 cal per pound = 351.964 pound gain over normal. Keep up the good work with your minor in health/nutrition. If you need a topic for a future term paper, you might find the "set-point theory" or the National Weight Loss Registry run out of the Miriam Hospital/Brown University Medical School intriguing.

[Mr.Krinkle]

Your 3500 calories/pound is the generally accepted value. A slice of bread is 75 calories x 365 days/year x 45 years/3500 cal per pound = 351.964 pound gain over normal. Keep up the good work with your minor in health/nutrition. If you need a topic for a future term paper, you might find the "set-point theory" or the National Weight Loss Registry run out of the Miriam Hospital/Brown University Medical School intriguing.

what?

do you have any idea at all waht youre saying? hahah typing?

not the way it works because we'd be seeing what? 500 pound people all over the place.

one extra slice of bread will not do what you claim. Thats a fact jack.

ps. im long done with school and term papers.

[Mr.Krinkle]

gotta love numbers.

[haypops]

what?

not the way it works because we'd be seeing what? 500 pound people all over the place.

True! That is not the way it works and that is why the usual claims of just adjusting calories, calories in = calories out, feed back loops, will power etc. are just not accurate.

[ellives]

[...snipped...]

If the govt wants to but in it should be arbitrary. They shouldnt but if they do keep it at a level playing field...no one wants to win on a technicality. Wheres the honor in that?

Toyota does it all the time....

[thegriffon]

Huh? You're numbers don't work so everyone else is wrong? Please. It doesn't work that way for two reasons—most people do have the sense to use a feedback loop, even without thinking about it; and the amount of calories you burn depends not just on exercise, but also on your weight. Most people find it's simply not possible to eat more than they burn every single day. It's simple physics, the more you weigh the more fuel you burn. If you reduce your exercise or increase your food intake you may put on weight quickly at first you will soon reach a metabolic balance. A slight increase or decrease in your calorie intake won't make much difference over time. To lose or gain a lot ot weight you have to continually exceed your intake with a lot of exercise, or exceed your burn with much more food than you require until the weight forces a continual reduction in exercise. Unlike abstaining from alcohol, losing weight requires finding time to exercise. Most people, myself included, simply have other priorities.

[haypops]

Huh? You're numbers don't work so everyone else is wrong? Please.

These are not just my numbers! They are the numbers you and others here are working off of. That is why the generally quoted explanation of taking in too many calories or burning too few is just not adequate. You are correct that as body weight increases more calories are required for basal metabolism, but not nearly enough to compensate for increased insulin resistance. Data from the National Weight Loss Registry that I mentioned earlier show that over 90% of the people who loose weight by normal means gain it back.

Unlike abstaining from alcohol, losing weight requires finding time to exercise.

Recovering Alcoholics expend more time than you would suggest for exercise. There are daily meetings and much time alone studying too. Those that suffer from both obesity and alcoholism find the former more difficult to solve, but the latter more disruptive.

Finally I would add that obese people who undergo one of several surgical techniques commonly referred to as stomach stapling undergo immediate biochemical changes to their metabolism, even if they had successfully controlled food amounts prior to surgery. There are profound changes to the biochemistry of the gut irrespective of food intake.

[Farkas]

So, uh, getting somewhat back on track, how exactly is CAFE measured? Do they just take the mpg ratings of all a vehicles engines and then average them?

So car company A has cars with averages of 31mpg, 29 mpg, and 19mpg, so their CAFE score would be 26.33mpg?

[ellives]

So, uh, getting somewhat back on track, how exactly is CAFE measured? Do they just take the mpg ratings of all a vehicles engines and then average them?

So car company A has cars with averages of 31mpg, 29 mpg, and 19mpg, so their CAFE score would be 26.33mpg?

It's described pretty well here:

http://www.nhtsa.dot.gov/cars/rules/cafe/overview.htm

Specficially the section entitled "How is a manufacturer’s CAFE determined for a given model year?"

I'd paste in the text but there are figures important to the explanation that wouldn't paste well.