The Big Three offer their restructuring plans to Congress
The CEOs of the Big Three automakers are back in the Capitol today (this time, they drove in hybrids rather than taking private jets), prepared to offer their revamped plans for restructuring to lawmakers. Their latest proposals contain considerably more promises to use a government bailout to make more efficient automobiles.
Under pressure to prove they wouldn’t spend bailout funds on more gas-guzzlers — perhaps their only hope of getting the money they say they need to stay afloat — they offered plans to convert operations. “General Motors well understands the challenges to energy security and the climate from worldwide long-term growth in petroleum consumption,” wrote the company in its new restructuring plan [PDF]. “GM believes that as a business necessity we must look to advanced vehicle technologies to reduce petroleum dependency and greenhouse gas emissions, and has structured this Plan accordingly.”
They’re asking for a $4 billion loan from the federal government right away, and up to $6 billion in additional loans early next year. In return, the company, whose CEO Rick Wagoner arrived in Washington in a Chevy Malibu hybrid yesterday, pledged that between 2009 and 2012, 22 of their 24 new vehicles would be “more fuel-efficient cars and crossovers.” They also promised “full compliance with the 2007 Energy Independence and Security Act” — a mighty generous offer, seeing as it’s a law and all — “and extensive investment in a wide array of advanced propulsion technologies.”
Their plan also includes a line with which many enviros might beg to differ: “Flex fuels represent the fastest way for the United States to reduce its dependence on imported oil.”
Ford wants a “stand-by line of credit” of up to $9 billion [PDF]. “We fully appreciate that the industry needs to transform itself to better compete by developing safer, greener and even better quality vehicles,” the company wrote in its appeal. They promised to produce six new small and medium sized vehicles in the next four years, increasing the car and crossover segment of their product mix from 48 percent to 60 percent.
They also noted that they will reduce the segment of trucks, vans, and SUVs from 52 percent to 40 percent of their line, though heavier vehicles aren’t going away: “Although we believe that the shift to smaller, more fuel-efficient vehicles is permanent, trucks, vans and SUVs will continue to be an important part of the North American market.” They pledged to double the production of flex-fuel vehicles by 2010, and make half of their products capable of running on E85 by 2012. As for hybrids, they said they will “continue to develop and deploy hybrids while reducing cost for expanded market applications.”
Ford also requested that in developing a stimulus plan, Congress should “consider incentives for consumers to trade in older vehicles and move to more fuel-efficient vehicles.”
But their request also included this dig at California’s request for a waiver to set higher tailpipe emission standards (which Obama is likely to grant):
Ford was proud to support stronger CAFE standards, and we are absolutely committed to meeting them. However, we urge Congress to maintain one economy-wide set of national standards on fuel economy. A patchwork of standards would place enormous financial and engineering burdens on manufacturers and have the effect of reducing consumer choice — all for little or no environmental benefit.
Chrysler says it needs [PDF] $7 billion or it could be broke in the next few months. Their “viability plan” promises “24 major product launches through 2012, including a wide portfolio of hybrid electric-drive vehicles within several categories: Neighborhood Electric Vehicles (NEV), City Electric Vehicles (CEV), Range-extended Electric Vehicles (ReEV), and full-function battery electric vehicles (BEV).” They note that they plan to have their first full-function electric-drive model out in 2010, and additional models by 2013. They “will have close to 100 vehicles dedicated to testing and development” by the end of next year.
Senate Majority Leader Harry Reid said earlier this week that they plan to have a plan for the automakers ready to go to the floor on Monday.