October 16, 1997

Auto Makers See Nothing but Trouble in a Warmer World

By JOHN M. BRODER

ASHINGTON -- For more than a decade, the auto industry has pretty much got what it wanted in this town. Tighter fuel standards? Forget about it. New safety standards? Small potatoes only, please.

But suddenly, Detroit is finding a new reason to worry about Washington: global warming. Industry officials say there is no greater threat to the American auto industry than a concerted worldwide push to reduce emissions of carbon dioxide and other so-called greenhouse gases, the suspected culprits in long-term global climate change.

Asked to rank the industry's major policy and regulatory concerns over the next few years, a senior representative of the Big Three answered, "Global warming is No.1, and everything else is very far behind."

No, Congress has not slipped out of Republican hands, and the Sierra Club's lobbyists are still outnumbered on K Street. But Mike Stanton, the chief Washington lobbyist for the American Automobile Manufacturers Association, said the industry is watching with great trepidation as officials debate the Government's position on a proposed global climate-change treaty.

With a prod from Vice President Gore, who sounded an early alarm about possible global warming, the Administration is expected to endorse some form of binding international emissions standards when representatives of 180 nations gather in December in Kyoto, Japan, for a conference on global climate change.

It is not surprising then, that when the President met with the chief executives of General Motors, Ford and Chrysler at the White House earlier this month to discuss trade policies, what he heard instead were complaints about emissions control.

The Kyoto conference will lay the road map for the next five years on how the world begins to cope with carbon emissions and their effect on climate and health.

The proposal that frightens auto makers most is one that will impose strict emissions standards on the developed nations but exempt the developing world, where the growth in greenhouse gas emissions is expected to be much more rapid.

But, suddenly, Detroit is finding a new reason to worry about Washington

Carbon dioxide occurs naturally in the atmosphere, but it is also emitted by cars, factories and the burning of carbon-based fuels like oil, coal and wood. Levels of this and other greenhouse gases are rising and thought to be warming the planet by trapping sunlight that otherwise would be reflected back into space. The automobile is a chief source of these gases. To environmental advocates, it is also one of the easiest to control.

"The reason they think it's such a threat is that the biggest single step we can take to prevent it is making our car go farther on a gallon of gas," said Dan Becker, the director of the Sierra Club's global warming and energy program. "So we are advocating higher-mileage cars."

Mr. Becker said a car that gets 27.5 miles a gallon produces 38 tons of carbon dioxide gas over a 10-year lifetime. A 45-mile-per-gallon car emits 23 tons.

That is what worries auto makers. One of their least-favorite pieces of legislation over the last 20 years is the law imposing corporate average fuel economy, or CAFE standards, forcing them to sell two or three economy cars for every low-mileage, high-profit car they produce.

here is no known way to eliminate carbon dioxide emissions from the burning of gasoline. Mr. Stanton said there are only two ways to reduce such emissions: drive less or drive in cars that burn less gas. That means either raising gasoline prices, imposing transportation-control measures like car pooling or alternate-day driving, or raising CAFE standards.

Each of these steps would impose huge costs on the industry -- and thus car buyers -- with uncertain benefits, Mr. Stanton said.

"The truth of the matter is there are lots of questions on the science of global warming," he said. "We don't think the state of knowledge justifies spending $200 billion to $300 billion a year to reduce greenhouse gas emissions to 1990 levels."

Mr. Becker scoffed. "The industry has shown an unwillingness to improve economy without CAFE standards," he said. "Our conclusion is that we can't rely on the environmental views of Detroit to improve the global warming pollution picture."

The Republican Congress has twice barred the Administration from taking steps to increase fuel efficiency standards.

While the possibility of new fuel-economy rules is the industry's major concern, there are several other significant issues before Congress and the regulatory agencies.

The National Highway Traffic Safety Administration is about to rule on consumer requests to disable air bags in cars, vans and light trucks. The agency is expected to approve on-off switches for passenger air bags that would address concerns for the safety of children, the elderly and short adults.

Views are mixed within the industry, with Ford and General Motors preparing to install on-off switches for customers who ask for them, while Chrysler, Honda and others are reluctant to offer the choice of disengaging the life-saving devices.

All auto makers agree that the preferable solution to the few cases of fatal air-bag deployment is not deactivation, but "smart" air bags with sensors that can reduce the explosive power of the bag when a seat is occupied by a child or a small adult. But auto makers are uncertain customers would be willing to pay the extra cost, about $250 a vehicle.

Another issue is international trade, which is splitting auto makers and their unions, who are shoulder to shoulder against radical steps on global warming.

"Trade liberalization has contributed greatly to the strong performance of the United States economy," said Shirley Zebroski, a senior Washington representative for G.M. "Our focus remains on getting improved access throughout the world for our products."

The United Automobile Workers and other unions are skeptical about President Clinton's call for "fast-track" authority to negotiate trade agreements. They say that such deals encourage American manufacturers to build plants overseas to take advantage of lower wages and looser environmental standards.

Also on Congress's auto agenda this fall is renewal of the nation's transportation financing program, the Intermodal Surface Transportation Efficiency Act, better known as Istea. Senator John H. Chafee, Republican of Rhode Island, introduced the six-year, $145 billion bill in September, saying it would assure the quality and safety of the nation's roads into the next century.

r. Chafee said he expected the auto makers' support in getting the bill through Congress, despite the fact that it contains a number of safety and environmental provisions that will cost the industry money.

"There's plenty in it for the auto companies," the Senator said. "Literally billions of dollars are going to be spent making our roads even better and maintaining them, which is terribly important to them."

In summing up the political climate for the auto industry, David Cole, the director of the Office for the Study of Automotive Transportation at the University of Michigan, calls it a "mixed bag."

"The Republicans are much more friendly to market-based approaches, rather than command and control from Washington," Mr. Cole said. "For labor and the Democrats, their issue is jobs. Then there are the big regional differences, the Midwest where the plants are and the Northeast, where the pollution is.

"When you look at nitty-gritty," he said, "it cuts across both parties pretty evenly."