Fresh Approach On Fuel Economy

Wednesday, February 28th 2007, 3:22 pm

By: News On 6

WASHINGTON (AP) _ A new approach is needed for setting fuel-economy standards, lawmakers said Wednesday as they considered changes amid concerns about global warming and the problems of struggling U.S. automakers.

The Bush administration outlined a proposal to boost fuel economy standards before members of the House Energy and Commerce Committee, which will help shape the measure.

Committee Chairman John Dingell, D-Mich., said the ``old debate is no longer sufficient'' with Congress' focus on climate change and the number of fuel-saving technologies now in place since the rules were first established in the 1970s.

``A system to regulate fuel economy, without considering the nature of the fuel or the level of greenhouse gasses it emits, may be inadequate,'' said Dingell.

The hearing was the first of several expected to examine gas mileage rules. Leaders of General Motors Corp., Toyota Motor Corp., Ford Motor Co., and DaimlerChrysler AG, along with United Auto Workers President Ron Gettelfinger, are expected to testify before the committee next month.

President Bush's proposal seeks a 4 percent annual increase in fuel economy requirements, part of a larger effort to reduce the nation's dependence on imported oil. The current system for passenger cars requires each automaker to have a fleetwide average of 27.5 mpg.

Edward Lazear, chairman of the White House Council of Economic Advisers, told the panel that Bush has made clear that ``we must accomplish these goals without damaging the American economy.''

But with automakers such as GM, Ford and the Chrysler Group shedding workers and closing plants in an ultra-competitive global auto industry, some members said they were worried it might hurt the industry.

Rep. Fred Upton, R-Mich., said he had seen estimates that Bush's proposal could cost the industry $100 billion, and add costs of $2,000 per vehicle. He cited estimates that GM's share would amount to $40 billion, compared with about $8 billion for Toyota.

Others said they were skeptical the government would raise standards because the legislation does not specify a numerical increase. They said adding flexibility to the program could prompt automakers to build larger, less fuel-efficient vehicles.

``There's nothing in the Bush bill that I can find that actually mandates a 4 percent increase,'' said Rep. Edward Markey, D-Mass.

Nicole Nason, administrator of the National Highway Traffic Safety Administration, said the agency would seek increases to the standards, which could take effect by the 2010 model year.

``We do believe we will get an increase. I can commit to you, we will raise the standard,'' Nason said.