More Miles, Less Pollution: Hope Versus Reality

I hear it all the time. "Those guys know how to build a car that can get 50 MPG, but they just don't want to."

It is often accompanied by the comment, "They can make cars that have lower emissions, they just don't care."

I heard more of those types of comments on Monday after President Obama signaled he may grant California and 13 other states waivers allowing them to set their own, tougher emission standards. "Good! This will teach 'em," is what one man told me in New Orleans.

After he said that I thought to myself, "So now, this is about 'teaching' the auto industry a lesson?"

Here's a little reality check for those who think the auto makers, and especially the Big 3, should be "taught a lesson." If the EPA grants California and other states these waivers, it will add costs to auto makers and make it tougher for them to return to profitability or grow profits. Why? It's a matter of adding more complexity to a business already struggling to find its footing.

This does not mean that I think we should abandon the push for tighter emission standards. Far from it. We should and will have cleaner running cars and trucks. My concern is that granting these waivers right now opens a can of worms and creates more uncertainty when the auto industry needs to know where it's going. In a long-lead and complex business like the auto industry, it takes years and millions of dollars to make changes. It's not a matter of wanting or not wanting to do something.

And yet, I keep hearing people say, "This will teach them not to build the HUMMER." It's the payback for years of auto makers fighting lower emission standards and calls for higher fuel economy.

I get that frustration.

What I don't get is the guy who doesn't see how a struggling auto industry will face even more pressure if it has to adjust the emission standards set by California and other states.

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Questions? Comments?