Catalyst Winter 2018
Final Analysis

Automakers Shouldn't Revert to Their "Can't-Do" Philosophy

Lee Iacocca, former CEO of Ford and Chrysler, was one of many automotive executives who pushed back against cleaner, safer cars—as in this quote from a 1985 Chrysler ad attempting to sway public opinion.
Photo: Timothy A. Clary/Getty Images; Ad: Chrysler Corporation

By Dave Cooke

After the Great Recession of 2008, when the Obama administration bailed out Detroit’s Big Three automakers, it looked as though these companies might turn over a new leaf.

Instead of fighting government-imposed safety and efficiency rules—their modus operandi for decades—automakers agreed to work with federal agencies on new fuel efficiency and tailpipe pollution standards that would steadily tighten through 2025. Those standards, implemented in 2012, have worked well so far: the automakers are still in compliance, and American drivers have saved nearly $50 billion at the pump over the last five years. At the same time, the industry made a dramatic comeback, selling a record number of vehicles in 2015 and 2016.

Because the standards were set well in advance, the Environmental Protection Agency (EPA) was required to conduct a “midterm review” in January 2017 to make sure the industry was on track to meet the standards for the years 2022 through 2025. That review confirmed the industry could do so at an even lower cost than initially anticipated, and the EPA announced it would keep the standards in place. After the Trump administration took office, however, automakers saw an opening to push back.

Just a month after the EPA’s announcement, automakers sent a letter to President Trump asking his administration to reopen the review, falsely claiming that the cost of continuing to meet the standards would exceed estimates and put a million jobs at risk.

As I pointed out in a December UCS report, Time for a U-Turn: Automakers’ History of Intransigence and an Opportunity for Change, such claims are in keeping with the kinds of hyperbolic statements automakers have been making for decades to blunt efforts to make vehicles safer and cleaner. In 1970, for example, when Congress was debating the Clean Air Act, Ford CEO Lee Iacocca insisted the legislation “could prevent continued production of automobiles” and “do irreparable harm to the American economy.” Thirty years later, Walter Huizenga, president of an auto dealer trade group, was singing the same song. “If Congress mandates an increase in fuel economy,” he asserted, “certain models of pickups, minivans, and sport utility vehicles could potentially be eliminated from the market.” Many more examples are described in the report, Time for a U-Turn.

Time after time, auto industry arguments have been proven wrong. Automakers have not only been able to comply with new health, environmental, and safety standards, but have consistently outperformed them as well. Instead of clinging to their traditional “can’t-do” philosophy, today’s automakers need to keep the promises they made to build safer, cleaner cars.

Dave Cooke is a senior vehicles analyst in the UCS Clean Vehicles Program. Read more from Dave on our blog, The Equation.