NADA Testifies in Support of a Single National Fuel Economy Standard


NEW YORK (Oct. 23, 2009) - The National Automobile Dealers Association, at a hearing on Friday, urged the federal agencies in charge of finalizing fuel economy and greenhouse gas rules for motor vehicles to work toward a unified and consistent single, national standard that clearly rejects the “flawed patchwork” approach adopted by a state air resources board in California.

Testifying on behalf of auto dealers, Forrest McConnell, chairman of NADA's regulatory affairs committee, told officials from the National Highway Traffic Safety Administration (NHTSA) and the U.S. Environmental Protection Agency (EPA) that “a single, national standard is essential and must set only feasible and affordable mandates.” 

“While the California Air Resources Board (CARB) has a long history addressing mobile source criteria and hazardous pollution, incorporation of its greenhouse gas rules (GHG) is neither practically necessary nor legally appropriate for a well-designed single, national fuel economy and greenhouse gas program,” McConnell said. “It is in this light that NADA has objected strongly to EPA's recent reversal of its prior denial of CARB's request for authority to regulate motor vehicle fuel economy and greenhouse gases.”

“NADA's objections have nothing to do with the propriety of raising fuel economy standards, but rather focus on the unworkable impact on dealership new-vehicle commerce that would result from a 'patchwork' of state-based regulations,” said McConnell, a Honda and Acura dealer in Montgomery, Ala.

NADA strongly supports the objective of the joint EPA/NHTSA proposal to create a single, national standard governing light-duty vehicle fuel economy and GHGs. This objective is the same as that sought by Congress when it enacted the Energy Independence and Security Act of 2007 (EISA). EISA amended the Corporate Average Fuel Economy (CAFE) law which has mandated fuel economy standards for passenger cars and light duty trucks since the mid-1970s.

NADA has long supported light-duty vehicle fuel economy improvements to the extent they are feasible and affordable.

“It is critical that the joint national standard recognize that feasibility and affordability are essential criteria to program success, both for new car and truck dealers and for any hoped for energy and environmental benefits,” McConnell added. “When considering feasibility, EPA and NHTSA must recognize first and foremost the dire economic state and volatile nature of the auto industry.”

The annualized rate for new vehicle sales in the U.S. was more than 16 million units just two years ago. Today that rate has fallen to less than 10 million units, he added. Over this time period, more than one-thousand new car dealers have gone out of business and overall dealership employment has dropped significantly.

The proposed joint single, national standard does contain several essential provisions designed to provide compliance flexibility and vehicle marketability, which NADA supports.

“Critically important is its vehicle attribute-based approach which should help ensure fuel economy performance improvements while allowing dealers to have a mix of cars and trucks available on their lots to meet customer needs,” McConnell added.

This proposal stylizes itself as a “National Program” which is “harmonized and consistent,” McConnell said. “Unfortunately, the proposed joint national program is constrained by its derivation from three fuel economy standards administered by three different agencies under three different laws. Despite everyone's best efforts, it is impossible for these three disparate programs [NHSTA, EPA and CARB] to be made fully harmonized and consistent. That's why a single, national standard is essential.”

NADA, among other things, intends to file written comments focusing on where the proposal “does not hit the mark” with respect to the difficult task of coordination, consistency and harmonization, he said.

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