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News Column
New Fuel Rules Might Create 23,000 Jobs in OhioFeb. 6, 2012 Randy Tucker
The government's new Corporate Average Fuel Efficiency standards, known as CAFE, would require automakers to raise the minimum average fuel economy of the cars they sell in the U.S. to 54.5 miles per gallon by 2025 and reduce greenhouse gas emissions. The current standard is 27.5 miles per gallon. Advocates say the push to improve fuel economy will spur hiring at auto plants and suppliers of fuel-saving technologies while at the same time slashing fuel costs for businesses and consumers. Critics, mainly auto dealers and conservative politicians, say nearly doubling the current CAFE standard will vastly increase the cost of producing new vehicles and price many customers out of the new car market, threatening jobs and the auto industry's recovery. Tim Doran, Ohio's spokesman for the state and local auto dealers' associations, was attending the organizations' national convention last week in Las Vegas and was unavailable for comment. The national group has repeatedly decried the new rules, which it says will add about $5,000 to the price of a new vehicle, about $1,500 more than the government's estimates. Ceres estimates passenger cars meeting the new CAFE standards -- which are required to improve annually by about 5 percent beginning in 2017 -- will save their owners an average of $4,000 over the lifetime of their vehicle, based on projected gas prices of $3.50 a gallon. "The jobs numbers are not only jobs in the auto industry. The majority of them will actually result from consumers saving money on these standards,'' said Carol Lee Rawn, director of transportation programs at Ceres. "Because consumers will realize so much in fuel savings, it goes into the broader economy and benefits a variety of sectors.'' Just about every automaker is now marketing fuel-efficient models and demand for smaller and more fuel-efficient cars has redefined the industry, bringing jobs back to Ohio after a decade of shedding tens of thousands of workers. The GM plant in Lordstown, Ohio is a prime example. In 2010, the plant hired back all of the workers it had laid off in the previous two years and brought in dozens of workers from shuttered GM plants to help build the new compact Chevrolet Cruze. The plant is currently operating at full capacity with about 4,500 employees. Although GM's sales dipped by 6 percent last month compared to January 2010, the company noted that sales of small and compact cars increased 30 percent during the same period. More recently, Honda announced last week that it would add 150 workers in Ohio at plants in Anna and Russells Point to build and assemble new continuously variable transmissions that lead to higher fuel economy. Most experts agree the demand for fuel-efficient vehicles and the jobs they can create cannot be sustained unless gas prices stay consistently high and the vehicles become more affordable. According to a survey conducted last fall by Maritz Research, 42 percent of consumers view fuel economy as an "extremely important'' purchase decision factor, up from 14 percent a decade ago, and 37 percent said they expect fuel economy will have the "greatest impact" on their next new vehicle purchase. The number was even higher for the next generation of car-buyers, or the so-called millennials, aged 13 to 29. Nearly half of that group -- 46 percent -- said fuel economy would be "extremely important" in their new vehicle purchase decision.these surveys are saying,'' Baum |
