The Auto Industry and a Democratic-controlled Congress

The voters have spoken: Democrats good, Republicans bad.  Okay, great, fine – we’re car people…we only care what that means to us.  Will the new Congressional mix mean anything for the wonderful world of automobiles? 

Yes – quite a bit.

  If life for the Big Three automakers wasn’t bad enough with declining sales, it is about to get worse.  Expect a Democratic-controlled Congress to push for higher CAFE standards, which will require that even trucks meet a reasonable mpg rating.  Since GM, Ford and Chrysler have been asleep at the wheel in terms of fuel economy, expect that they’ll be frantically buying technology from Toyota and Honda to meet any new requirements set by Congress in this arena. 

Before you start pointing out that the Big Three can use their current diesel technology, keep in mind that Democrats will likely pass other environmental laws requiring cleaner fuels.  While diesel doesn’t cause global warming, current diesels offered by all automakers pose a more immediate threat to health: soot emissions that cause asthma and other cardiovascular diseases.  Not even VW’s next-generation diesels are 50-state legal, and they have particulate traps and clean-burning direct injection that the engines used in GM and Ford vehicles don’t. 

Expect lots of debate over ethanol/E85, biodiesel and hydrogen.  Lobbyists will define the option that gains the most traction. 

Hopefully any Clean Air legislation wouldn’t expand emissions requirements to classics.  Traditionally been an issue for states and counties.  It would be nasty for collectors across the country to have to abide by California-like rules necessitating original emissions equipment on all vehicles made after 1968.  I’m all for breathable air, but California’s rules are ludicrous when applied to seldom-driven old cars.

 With the subpoena power of the House, expect Democrats to investigate oil company price gouging.  It is possible that fuel costs could come down with pressure via a windfall profits tax and/or threats to sue over price manipulation. If fuel costs stay the same or retreat, it is likely that the market will continue to enjoy more years of horsepower wars. This year it’s 500 hp Viper, Vette, Mustang…in two years, expect 600 hp to be the standard, which would make my 350 hp C5 Corvette seem positively old-ladyish.

  It will be an interesting two years.  With any luck, Congress will be able to do what they usually do: pressure the domestic auto industry to create safer, cleaner, more fuel efficient cars by threatening legislation. 

The long and short of it all is that a new Congress will actually make GM, Ford and Chrysler produce better cars… even if the executives do it kicking and screaming the whole way.

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