INTRO: Washington’s pressure on Detroit and the state of Michigan is heavy. Almost no one still living here wants to see the car companies go bankrupt. One pressure point might also be an opportunity: making environmentally friendly vehicles. Michigan Now’s Chris McCarus asks why the companies haven’t built more.
TRX1: So far, Connecticut Senator Christopher Dodd has appeared the most worried about the environment. He says Americans demand for mini buses alone is up by 30%.
AX1: “We got tremendous demands from some of our local communities and we’ve have American made requirements here. It seems to me we might be thinking about a market that’s emerging for mini buses, mass transit systems, railway cars and the like.”
TRX2: Dodd doesn’t believe low gas prices will be around for long. He wants the Detroit 3 to make different vehicles that get higher mileage. During testimony in Washington, GM Chairman Rick Wagoner responded and so did Chrysler Chairman Bob Nardelli.
AX2: “And I’m proud to say that I drove a hybrid here from Detroit and the technology performed extremely well. I presume it was a Chrysler? (Laughs) Yes sir. Well you all made buses, it used to be in your supply chain, you used to also do rail cars. Right? You all made buses at one time didn’t you? (Wagoner) Yes we made buses. We were in the rail business as well. Any thoughts about getting back into that? Um we continue to build a fairly large van, of which the implications are largely commercial. I’m making note of your comment about the increase in demand likely out of the trust fund because we have plenty of capacity and that van is a competitive one and it can be adapted to those kind of uses. We also have some ventures that we work in Europe where the product of there is a similar van that gets better fuel economy. We have looked from time to time at whether there will be a market for that in the U.S. for tooling up it up to build it in the U.S. so as that develops we would be very interested.”
TRX3: If Senator Christopher Dodd was hoping that Michigan could get out of the car business and into making subway and commuter trains instead then he’d be disappointed. He’d be barking up a tall tree. Bob Roethler just retired after 40 years as a Ford engineer.
AX3: “It’s theoretically feasible to convert. But they talk about the business model. You would essentially have to convert the auto industry into a subsidiary of the government in order to make that transition I fear.”
TRX4: Roethler was a senior research and development man in transmissions and drivelines.
AX4: “We’re in I would say interesting times because before the financial crash the high price of fuel was driving fairly rapid change just in the market. I really believe the market was beginning to move faster than say the government CAFÉ regulations to drive change in the auto industry.”
TRX5: CAFÉ stands for corporate average fuel economy. Congress passed it into law in 1975. But, fuel use didn’t go down because of CAFÉ. It went up by 60%. And imported oil use has gone up 35%. Roethler says instead of higher fuel economy we got lower gas prices and that just increased demand for gas chomping muscle cars.
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Tonight Show host Jay Leno had NBC News Anchor Brian Williams on recently.
AX5: “By the way, the car you drive today…..
TRX6: Retired Ford engineer Bob Roethler is proud of American technology. But thinks maybe it hasn’t been used right.
AX6: “we spent a lot of effort on improving the efficiency of power trains. But rather than recapture that as fuel economy what we did was built more powerful vehicles and bigger vehicles with about the same fuel economy. So the technology went where consumers go. The auto industry has to sell what people buy.”
TRX7: Did people want just horsepower? Could the companies have marketed smaller engines in smaller lighter bodies? Bob Roethler says think of a Honda Civic or Toyota Corrolla from the 1970′s. Even those cars got bigger.
AX7: “You’d pay extra for luxury a bigger car, more performance. But you wouldn’t pay extra for fuel economy. There’s a lot of talk about business plan where there isn’t a viable business plan. You couldn’t charge a premium for small cars.”
TRX8: The solution, says Roethler, would be a gas tax. And only the government can do that. Government put railroads in business in the 1800′s. It put them out of business in the 50′s and crowned cars king with the interstate road network. Government has to step in again. Roethler credits General Motors with designing hybrid engines for commercial trucks and buses. Now they are being used in smaller vehicles.
AX8: “GM out of their Allison division, they had developed essentially a very large scale version, technologically superior than Toyota’s, and they sell that in large buses. And They’ve converted that to what they call a duel mode operate. Scaled it down and released that in their Cadilac and their larger SUV’s.”
TRX9: Roethler says the plug in hybrids like the Chevy Volt, due out in 2010, will make more sense in the future when all our electricity doesn’t come from coal burning power plants. So hybrids plug ins are the most environmentally friendly in the near future.
AX9: “I am a transmission guy and the key to the Toyota Prius and the GM hybrid and the Ford Escape is actually the transmission. It’s not the engine. The transmission combines the power from electric motor and the gasoline engine on the vehicle in a very innovative way.”
TRX10: Roethler says if he were a government guy he’d be concerned with global warming, peak oil and running out of money buying oil from foreign countries. And of course he doesn’t want to see the company he devoted his life to be broken up and auctioned off. Neither does NBC’s Brian Williams.
TRX11: In bankrupty, Detroit will have trouble solving problems with transportation, trade or global warming. It will just be creating more problems of its own. New York seems to understands this. So does L.A. but apparently, Washington doesn’t. For Michigan Now I’m Chris McCarus.