Obama faces immediate challenges with Detroit
To be fair, the new president faces a lot of immediate challenges. But when it comes to the auto industry, the biggest four challenges could be the bridge loans, fuel economy mandates, the EPA vs The California 14, and the board of czars that will oversee the fortunes of GM and Chrysler. The similarity between these challenges and others on the domestic and global agenda: he doesn't have a lot of time to get them right.It was clear that the $17.4 billion granted to GM and Chrysler was just the beginning of a process needing a well thought out and long term endgame. Part of that endgame involved the two automakers coming up with viability plans, which are due on February 17. Then Congress and the president will need to decide, based on those plans, whether the car companies should receive more money.
Should the carmakers get more money, the necessary car czar position is looking like a body-of-car-oligarchs instead, which sounds like a more reasonable idea. One name that has popped up to head the group is Steven Rattner, a former NYT reporter turned private equity fund founder. What hasn't been explained yet is how this board of overseers is meant to work with the car companies.
On the issue of fuel economy, some of Obama's campaign pledges might cause additional consternation. He had said he wanted to double the CAFE standard in 18 years, which would mean a 50 mpg average by 2027. He has backed off of that to the more generic "I want to raise fuel economy standards." His other campaign trail pledge was to review the EPA not granting California and 13 other states a waiver to set their own emission standards. His EPA designee has said one of her first priorities will be to review that decision, and she sounds like she intends to overturn if she can. If that happens, as the Obama administration lifts up the industry with one hand, the industry will probably feel itself being choked by the other hand.
[Source: Detroit News]
Reader Comments (Page 1 of 3)
Sea Urchin 3:34PM (1/23/2009)
Obama, give them money, BUT demand 40-45+ MPG by 2015
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adam 3:44PM (1/23/2009)
thats just about retarded.... but thanks for chiming in...
JF 3:41PM (1/23/2009)
That's ok if, and only if, the consumers demand it as well. Hopefully they'll end up wanting the same things as the government will be demanding.
Andee 3:42PM (1/23/2009)
The world economy has gotten worse and worse. At this point car companies in europe are also suffering and if economy doesn´t jump up, they will soon desperately need money from their goverment.
So US. car companies should receive more money.
notYou 3:44PM (1/23/2009)
Sea Urchin: Obama, give them money, BUT demand 40-45+ MPG by 2015
That just isn't good enough. Jim Hansen - Nasa scientist and leading climate expert - released his report stating that Obama only has 4 years to defuse the Man Made Global Warming which our vehicle fuel consumption is cuasing:
http://www.guardian.co.uk/environment/2009/jan/18/jim-hansen-obama
We must have at least 100MPG by 2012 or we are all doomed.
Actually, it would be even better if we had 0MPG - by that I mean no car consumed fuel or produced global warming gasses at all.
There is no alternative, we must act now. Obama promised he would do this - anything less is unacceptable and disastrous to all mankind.
(snicker)
notYou 3:46PM (1/23/2009)
Sea Urchin: Obama, give them money, BUT demand 40-45+ MPG by 2015
That just isn't good enough. Jim Hansen - Nasa scientist and leading climate expert - released his report stating that Obama only has 4 years to defuse the Man Made Global Warming which our vehicle fuel consumption is cuasing:
http://www.guardian.co.uk/environment/2009/jan/18/jim-hansen-obama
We must have at least 100MPG by 2012 or we are all doomed.
Actually, it would be even better if we had 0MPG - by that I mean no car consumed fuel or produced global warming gasses at all.
There is no alternative, we must act now. Obama promised he would do this - anything less is unacceptable and disastrous to all mankind.
Heck, even the sea urchins would die.
(snicker)
Big Rocket 3:53PM (1/23/2009)
@JF: It is a myth that CAFE will mandate cars that are dull, boring, and undesirable to the general public. CAFE stands for Corporate *Average* Fuel Economy. Automakers can still make fun cars with poor gas mileage, as long as they also make boring cars with great gas mileage, so it's not like fun cars will become illegal because of CAFE(*). And if an automaker (like Porsche) decides to focus on expensive and profitable sports cars, completely foregoing fuel-efficient econoboxes, that's not being stopped either, and the automaker only has to pay a fine, which is then passed onto the car buyers. Which, if you think about it, is a lot like the gas tax being touted by the anti-CAFE crowd: Increase the cost of ownership of gas-guzzlers. If you look past the partisan bickering, CAFE is accomplishing what the detractors say should be done.
(* This doesn't even take into account how fun cars can also be fuel efficient. Horsepower is just one part of the power to weight ratio.)
Jon B 3:54PM (1/23/2009)
@notYou:
Scientist can't even predict the 10-day weather forecast accurately, and you want me to believe that we are doomed if we don't stop producing GHG by 2012. HA! Stop breathing then because you are creating CO2 right now. Oh and don't have any children because each one of them is probably the most disastrous thing to society over their lifetime.
Epyx 3:58PM (1/23/2009)
NotYou - "We must have at least 100MPG by 2012 or we are all doomed."
If this is true we are already doomed because that is an impossibility by 2012. Even if cars were available by then capable of achieving that target, there is no way to replace all the less efficient vehicles still the road.
As nice as 0 oil dependence would be it is not going to happen by 2012 unless we all start living in log cabins and using horses to get around like it was 1865. Maybe Obama will get to be more like Lincoln after all.
dkw 4:28PM (1/23/2009)
@notYou:
I know this is an automotive blog, but why does everyone seem to focus on automotive vehicles being the sole problem for any (real or preceived) global climate issue?
The latest chart I saw stated the producers of greenhouse gas were:
21.3% Power Stations
16.8% Industrrial
14.0% Transportation
12.5% Agriculture byproducts.
Remember, "Transportation" includes the vehicles on the roads, as well as airplanes, boats (recreational and shipping, i.e. bardges and tankers), etc.
It just seems to me that we are attacking one source (automotive) with much more vigor the we are the other sources.
Rich 5:28PM (1/23/2009)
@JohnB:
There's a difference between "weather" and "climate". Weather is to climate as speech is to language.
notYou 7:54PM (1/23/2009)
I just want to point out to everyone who kindly "disagreed" with me - my (snicker) at the end or my post.
Correct, my post was just as ridiculous as the "facts" that I cited and Sea Urchin that I replied to.
(snicker - stirring the pot, again)
BILL 3:37PM (1/23/2009)
With the Feds getting so involved in the private sector - cars, banks, etc - it is becoming apparent that we in the private sector may well be screwed. Let's face it, Liberal Democrats are not our friends. They are friends with other Liberal Democrats, and the rest of us can suck air.
Reply
Randy 10:45PM (1/23/2009)
That's funny! I could have sworn a Conservative Republican was at the helm for the past 8 years! Silly me! I though his last names was... was..... well it rhymed with "completely disgraceful united states president" Oh yeah, BUSH!
Not the old one, the drunk with 2 DUI arrests, an AWOL from the Military and was quoted on live news across the world (and available on youtube) "What does the war in iraq have to do with 911? Nothing! Nobody ever said the war in Iraq had to do with 911"
Or we could think you're right on this and blame Obama since he's been in office for 3 and a half days and has had so much time to completely ruin this country! Oh wait, again I'm wrong, that was Bush too! Ooops!
Pay attention to the bumbling!
http://www.youtube.com/watch?v=5LwMTjeu5f4&feature=PlayList&p=B76B9BE0F4E0DD13&playnext=1&index=26
chrispc88 10:59AM (1/24/2009)
I just thought I'd point out that Bush is part of the 'Republican' party - but he demonstrated that he is not 'Conservative'. This country is still basically 50/50 between those who call themselves Republican and those that call themselves Democrat. Yet, Bushes approval ratings were far below 50%. Democrats basically never gave Bush a chance (he was Evil from day one in many of their eyes). However, there is still the other half of the country that is Republican, yet roughly half of those people (including myself) came to dislike/distrust Bush over the course of his presidency. This was in large part due to those issues in-which he did not follow a conservative mindset. Case in-point, huge spending and bigger government. However, I would also argue that as for the current financial crisis - Democrats have been in charge of the 'purse strings' now for over 2 years... oh' and the worst of our economic troubles have been in the past 2 years out of the last 8. Maybe it's just a coincidence, maybe not.
Randy 12:59PM (1/24/2009)
@chrispc88
I respectfully disagree! President Bush is rated on PoliticalCompass.org as being pretty conservative!
http://politicalcompass.org/uselection
Ironically, President Obama is slightly conservative as well according to their ratings!
http://politicalcompass.org/uselection2008
Bush getting a "chance" didn't matter since he vetoed anything he wanted to! He game himself ultimate power (the closest we've come to a dictatorship in the US) by way of instilling fear in the publics mind which cause the people to allow their senators and congressmen to give that power to Bush (look it up, I'm not bashing)
Furthermore, Republicans had complete control for a portion of the Bush administration which by law allowed them to repeal any previous law, policy, decision, rule, guideline etc) so in two fold, the suggested "no chance" scenario you suggest is factually incorrect BUT I can see how you could come to that theory since we only know what we are told (agenda ridden media on BOTH sides).
Finally, as for the country being half democrat and half republican. That too is incorrect! I for one am neither and believe a two party gives us a see-saw effect of policy and plan.. 4 year to the left, 4 years to the right... etc The only way to combat that is to get rid of the "parties" but who in their right mind would take the power away from themselves! Oh wait our founding fathers!
As for the 50/50 split you infer!
55 million registered Republicans
72 million registered Democrats.
42 million are registered as independents
some other minor party or with a "No Party" designation.
That's
31% Reupublican
41% Democrat
24% Independent
3-4% No party designation or a minority party!
But it is correct to think that the Independent party does win the election! That's a good thing if you ask me!
I just spent an hour on this! I hope someone read it! LOL Peace!
Luis 3:53PM (1/23/2009)
I don't understand why we don't increase the gas tax by $2/gallon to pay for these loans. That way, the market will demand more fuel efficient cars (forget CAFE) while money can be used to fuel research and development by the car companies.
There, all done.
Reply
chrispc88 4:15PM (1/23/2009)
I don't understand why we don't just let people buy the car they want and or can afford. If you want and can afford a gas guzzler, then fine and if you can't then you will automatically buy something else. What gives any of us the right to dictate (through artificially raising prices and or taxes) what a person can or can not drive? Last I checked, I'm living in a free country. If we allow this, then what next? Maybe start charging higher taxes on companies that make DVD players in-which the carbon emissions during manufacturing was higher than some other manufacturer. This is the problem with the democrat mindset - you people always think you know what's "good for all of us" and never look beyond your own nose.
Peter 4:21PM (1/23/2009)
the CAFE is weak, its a way for politicians to try and impose their will on the people to be more eco friendly without actually trying to get people mad at them.
The point of the CAFE is to get better fuel efficiency. It sucks. The best and most efficient way to get cars to have better fuel efficiency is to just slowly push the gas tax up. Now I am not saying I am for it just that if the govt wants to wean us off fossil fuels or use less and demand better fuel efficiency then increasing the gas tax is the best way to do it. For once I must say go look at Europe they tax their gas like crazy and have great high mileage vehicles.
IF the point and objective is to get us to consume less fuel then just tax it.
Its like income, if the govt wants us to spend less of our money they just tax us more, lol. Sad but true.
David 4:43PM (1/23/2009)
I have an idea. I think the government should set up a program for all those who buy into the Global Warming hoax that will allow them to tack on a $2/gallon for every one that they purchase. It would be a self-imposed "guilt" tax that will make you feel better and actually make you put your greenbacks where your mouth is. For me, I don't buy into the hoax that Global Warming is anthropomorphic, and therefore do not believe we should be "forced" into doing anything about it.