Word on the street is that President elect Barack Obama spent some time in the oval office yesterday with current President Bush talking about the auto industry, and the junior Senator from Illinois urged the President to address the automakers' dire situation post haste. The President seems to be on the same page, with word coming out of the White House that it would consider a congressional proposal to carve out $25 billion of the nation's $700 billion bailout plan just for the auto industry. That's in addition to the already approved $25 billion worth of low-interest loans to automakers, the distribution of which may also get sped up considerably. Those low-interest loans may even get restrictions lifted that were to ensure they be spent on green cars and retooling factories, but now may be used for anything the domestic automakers deem most prudent. Nothing's final until it goes though Congress and gets the President's approval, but it would seem the considerable squawking coming from General Motors for federal aid has reached the ears of those who may actually do something about it. Whether they should or not is still an open debate.
Barack Obama has been less than friendly with Detroit automakers in the past, but he's promised to meet with them both during his campaign and afterwards if he makes it into the Oval Office. The presumed Democratic nominee told a crowd in Flint, MI that he would meet with executives to discuss how "we're going to build the cars of the future right here in Michigan." Obama also criticized President Bush not meeting with automakers until his sixth year in office, which actually isn't true. President Bush met with automakers in 2003, though his second meeting with industry execs was delayed several times in 2006.
Obama has also promised to deliver $150 billion in funding over 10 years and 5 million jobs in the "green sector." Some of the money is being promised to automakers to retool older plants for plug-in electric vehicle production, which would be welcome news to the financially struggling automakers. It's typical of politicians to promise the moon and stars while on the stump, so we're sure automakers are listening with a skeptical ear and taking notes. Time will tell if actions will take the place of words.
We'll be honest. We didn't watch President Bush's State of the Union address last night, the final one of his second presidential term. Our disinterest can probably best be measured by the fact that the address being broadcast in high definition was the only draw for us, which got us to watch for about five minutes and then it was back to American Gladiators on the DVR. Apparently we didn't miss much as it relates to the auto industry. Automotive News reports that the president called for more federal research into advanced batteries and renewable fuels for cars and trucks of the future, and that was about it. It's a far cry from last year's State of the Union where President Bush declared that the U.S. is addicted to oil and made a little weed called switchgrass famous. The heavy-handed 2006 address was likely one of the factors that led to getting a new energy bill passed in December with significantly stricter Corporate Average Fuel Economy requirements for automakers. With just a year to go in his final term, however, it seems President Bush isn't pushing the auto industry as hard as he did last year. At the same time, the auto industry also seems less in need of a push in 2008. The aforementioned new energy bill seems to have taken care of that.
[Source: Automotive News, Photo by TIM SLOAN/AFP/Getty]
This morning President Bush put pen to paper (no doubt one of those really cool American President pens) and signed into law the Energy Independence and Security Act of 2007, all 822 pages of it. As we all know by now, the pillar of the law is an increase in Corporate Average Fuel Economy standards to 35 mpg by 2020. The increases will be built up over time beginning with the 2011 model year, which really isn't that far away. The measures regarding CAFE also don't apply fleetwide as one single standard, but will be adjusted based on the type of car or truck being measured. Nevertheless, after decades of nary a budge in this country's CAFE standards, an increase of some 40% is monumental and will likely begin immediately affecting the cars and trucks we buy.
We mustn't forget the path fraught with peril that this bill took to reach the President's desk. After being passed by the House of Representatives thanks to a compromise between Speaker of the House Nancy Pelosi (D-Calif.) and Rep. John Dingell (D-Mich.), the bill moved to the Senate where it was voted on twice and failed before a large $21.8 billion tax provision was removed. Until that point, the President had promised to veto the bill. Without the tax provision, however, the bill was finally passed by the Senate, and then reapproved by the House just yesterday.
In order to meet the standards, we expect automakers to begin producing more mild hybrids in the near future, with full-on parallel hybrids being at least an option on most vehicles after that. The use of modern clean-diesel engines will also proliferate, especially in light-duty half-ton trucks like the Ford F-150 and Chevy Silverado that would have trouble meeting their own CAFE targets with traditional V8 engines. Then there's more exotic technology, like the series hybrid system being developed by GM for the Chevy Volt. If successful, expect other automakers to very quickly follow suit with their own series hybrid drivetrains. There's lots of simple and more complex technologies on the table that automakers will utilize to increase their CAFE rating, and no doubt the cost of developing these systems will be passed on to the consumer to some degree, as well. Supporters of the bill, however, remind us that reducing our dependance on foreign oil is a very good thing, and in the end, we only get one Earth on which to live.
[Source: The Detroit News, Photo by Shawn Thew-Pool/Getty]
"I'm gonna pay for that." That's what Alan Mulally said after beginning the now infamous "President Bush almost blew himself up" anecdote in his keynote speech to kick offf the 2007 New York Auto Show last week (video above). Truer words were never spoken by an auto exec. The firestorm that erupted after Mulally's anecdote hit the intertubes has been incredible. Though Autoblog reported on the anecdote in passing mere hours after it was told onstage, it received its biggest boost in visibility from the Detroit News' Business Insider column, which retold the story and began by saying ""Credit Ford Motor Co. CEO Alan Mulally with saving the leader of the free world from self-immolation."
This past Monday, Keith Olbermann broke up the fun being had at the President's expense by revealing a tape of the White House event in question that showed Mulally's funny story was not true at all, and that he never stopped President Bush from plugging an electrical cord into a hydrogen refueling port (check out that video after the jump). With the cat out of the bag, Mulally issued an apology via press release (do spouses accept those?) on Monday for his misleading anecdote. His embellishment of the situation with the President was apparently inspired by a bit that appeared on the Jimmy Kimmel Live show. For his part, Mulally stated, "I am no Jimmy Kimmel."
Though all should have ended there, Todd Lassa, who writes for Motor Trend, wrote a scathing diatribe on Tuesday against the "rampant blogosphere" that siezed upon Mulally's anecdote and repeated it at an exponential rate. Mr. Lassa, who fancies himself a member of our little blogging community (hint: he's not), proceeds to lash out at us "small-time bloggers" for not checking our facts, placing immediacy above accuracy, and leading major media outlets -- presumably ones like Motor Trend -- on wild goose chases. We're not entirely sure at which blogs his venom is aimed, since Lassa conveniently doesn't name any in particular, but we consider ourselves and our peers to be his target. We might've even taken his criticism into consideration if it hadn't concluded with a shill for his own site. Sigh... we wish we could all just get along, but old media seems to never want to play nice.
Allan Mulally has already lived a very successful life, having helped save American icon Boeing, then taking over the reigns as Ford Motor Company's Chief Executive Officer. Now he has added 'the guy that saved President Bush' to the list. Mr. Mulally used his media audience at the New York Auto Show to tell a pretty great story about his recent trip to the White House.
Ford Motor wanted to give President Bush a first-hand look at their hydrogen electric plug-in hybrid, so the company arranged to have a demonstration of the uber-tech Ford Edge right from the White House lawn. When walking with the President towards the vehicle, Mulally noticed that the extension cord was placed to the rear of the car, where the Hydrogen fuel tank resides, instead of the side of the car. As Mulally saw the President approach the rear of the car, he decided that he should physically grab the president and "make sure he plugged into the electricity, not into the hydrogen."
We obviously don't know for sure whether or not the leader of the free world would have stuck an electrified cord into the Edge's Darwin-hole, but we do think it was a damn good idea Mulally stepped in to make sure Mr. Bush did the right thing. We don't think Ford's green initiative would have been able to recover if the company's best and brightest technology fried the President. Then again, given the approval numbers of Mr. Bush... we kid, we kid.
We've just finished watching the coverage of a press conference held outside the White House following the president's meeting with General Motors CEO Rick Wagoner, Ford CEO Alan Mulally and Chrysler Group CEO Tom LaSorda. We attempted to watch the press conference live on Fox News, CNN and CNN Headline News, but each channel only allowed Rick Wagoner, the first of the three CEOs who grabbed the mic, about 30 seconds of uninterrupted air time. After that we got an earful of pointless and shallow commentary from no-name TV face jockeys who merely ran down the meetings itinerary rather than letting the men talk. Ugh. News channels suck.
Anyway, the gist of the meeting was that the president listened to the Big Three's concerns with an open ear, but offered no commitments that the government would jump to action on any of their points. The meeting's main talking points included energy security, the competitiveness of U.S. manufacturing, health care costs, the weak value of the yen and the rising cost of raw materials like steel. For all of the hoopla over this meeting finally taking place after two postponements, we're surprised that more didn't come of it. Although, considering how big this president is on the free market economy, the three gentlemen from Detroit should have known right from the start that our Commander in Chief would just order them to build better cars that people want to buy. If only it were that simple.
Click on through for a joint statement by General Motors, Ford and The Chrysler Group that was released immediately following the press conference. Feel free to discuss the finer points of government and civic duty in the comments, but keep it civil yourselves.
According to an AP item, some gas station owners in Oklahoma are actually dropping Citgo brand gas, blaming slumping sales on Venezuelan President Hugo Chavez's statements about President Bush being the devil. Citgo is a state-owned Venezuelan company.
Gas distributor Arkansas Valley says that it has seen a 10-15% drop in sales to some Missouri and Oklahoma stations following Chavez's United Nations speech where he called Bush "the devil."
"We started losing business at our stores," company president Weister Smith told the Tulsa World newspaper. "Some of our independent retailers came to us and asked us to make a change away from Citgo. Some of them actually covered up their Citgo signs."
Citgo had already announced plans to stop selling their fuel at 1,900 Citgo-branded stations in 10 states, including Oklahoma, by March. But some independent retailers are afraid consumers will start going elsewhere if they don't speed up the switch to another brand.
However, Duff Thompson, president of Fiesta Mart, dismissed these complaints by explaining that rumors of a boycott of Citgo stations started soon after the speech, leading him to switch brands at eight of the company's Tulsa stations.
"We have some stores showing declines," Thompson said. "But I wouldn't attribute it all to the Chavez situation."
And it's important for consumers to know that boycotting Citgo stations will hurt the station owners more than Chavez or the Venezuelan company. "It's not Citgo they're getting back at," Vance McSpadden, executive director of the Oklahoma Petroleum Association said. "It's that independent businessman who has got his livelihood invested in that business. That's who you're punishing."
In the never-ending saga between the Bush administration and Detroit's automakers, a tentative date has finally been set for a meeting.
During a radio interview, President Bush's political advisor Karl Rove confirmed that a discussion between GM, Ford and DaimlerChrysler would take place in mid-November. A specific date was not mentioned, mainly to allow the White House flexibility in it's scheduling.
A sit-down was originally planned in June of this year, with the conversation to center around health-care costs and alternative fuels. GM's Rick Wagoner and others in the industry have made it clear that a 'bailout' is not in the cards.
Ron Gettelfinger, president of the United Auto Workers union, took a shot at President Bush Tuesday for his failure to put forward a national industrial policy addressing issues affecting U.S. automakers, ranging from out of control health care costs to Asian monetary policies.
Speaking at the Reuters Auto Summit in Detroit, Gettelfinger said it was "humiliating" that Bush found time to meet with TV "American Idol" Clay Aiken, but has put off meeting with auto industry executives until after the November election, going on to accuse Bush of "...walking away from the industry that does more for our economy than any other."
Word on the street is that President elect Barack Obama spent some time in the oval office yesterday with current President Bush talking about the auto industry, and the junior Senator from Illinois urged the President to address the automakers' dire situation post haste. The President seems to be on the same page, with word coming out of the White House that it would consider a congressional proposal to carve out $25 billion of the nation's $700 billion bailout plan just for the auto industry. That's in addition to the already approved $25 billion worth of low-interest loans to automakers, the distribution of which may also get sped up considerably. Those low-interest loans may even get restrictions lifted that were to ensure they be spent on green cars and retooling factories, but now may be used for anything the domestic automakers deem most prudent. Nothing's final until it goes though Congress and gets the President's approval, but it would seem the considerable squawking coming from General Motors for federal aid has reached the ears of those who may actually do something about it. Whether they should or not is still an open debate.
"I'm gonna pay for that." That's what Alan Mulally said after beginning the now infamous "President Bush almost blew himself up" anecdote in his keynote speech to kick offf the 2007 New York Auto Show last week (video above). Truer words were never spoken by an auto exec. The firestorm that erupted after Mulally's anecdote hit the intertubes has been incredible. Though Autoblog 
Ron Gettelfinger, president of the United Auto Workers union, took a shot at President Bush Tuesday for his failure to put forward a national industrial policy addressing issues affecting U.S. automakers, ranging from out of control health care costs to Asian monetary policies.
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