Borg Warner CEO Is One Of Few To Ask Trump To Leave Strict CAFE Standards Alone

7 months ago by Steven Loveday 31

The all-new 2017 Chevrolet Bolt has taken numerous awards, and is the first widely available, affordable, long-range vehicle in the U.S.

The all-new 2017 Chevrolet Bolt has taken numerous awards, and is the first widely available, affordable, long-range vehicle in the U.S. Without the critical role of suppliers, this would not be possible.

The Chrysler Pacifica Hybrid plug-in earned a spot on the Ward's 10 Best Engines list and has received other notable accolades since its inception.

The Chrysler Pacifica Hybrid plug-in earned a spot on the Ward’s 10 Best Engines list and has received other notable accolades since its inception.

President Trump has proven eager to meet with tech company leaders, top manufacturing gurus, and automakers, including the Detroit Three. However, these companies count on a vast network of suppliers to make their products a reality. Thus far, the administration hasn’t had time to communicate with automakers’ substantial support network.

This week, the Detroit Economic Club hosted a mobility meeting, and had an opportunity to hear from top brass at three major automotive suppliers. They feel in the dark, and concerned at this point, and each offered their perspective.

David Dauch, chairman and CEO of American Axle & Manufacturing, shared (when questioned about his concerns):

“It’s the whole tax-reform strategy… the trade-reform strategy, an energy policy that’s good for this country, an environmental policy that’s good for this country, a labor environment that’s competitive for us.”

“Our policy is that we like manufacturing our products where the product is being consumed … whether that’s here in the U.S., whether that’s in Mexico, whether that’s in China or Europe.”

Dauch said that worries go well beyond changes in trade and the renegotiation of NAFTA. Trump’s “America First” stance has no wiggle room or parameters, and will make many suppliers’ choices difficult.

CEO of Lear Corp., Matt Simoncini agreed about the missing details. Nothing has a definition when it comes to “imports,” and companies can’t attempt to follow specifics, because there are no specifics. There is no prior warning of significant changes, so companies can’t plan ahead. He explained:

“What we need is clarity of policy and time to react. What we have right now is a bunch of vague comments, vague policies, a tax program where we’re not really sure how it’s going to impact us.”

It can be compared to the recent travel ban, and the building of a border wall between the U.S. and Mexico. Simoncini noted that infrastructure development, like that of the “Trump’s wall,” will trickle down to suppliers. These groups, and everyone else involved, need time to plan ahead, and it botches up competition do to “competitive disadvantage” related to lead time and preparation. He said:

“Infrastructure spending typically drives demand for light vehicles and trucks.”

James Verrier, president and CEO of Borg Warner, was the only one that complimented Trump on his alacrity to take the time to speak with business leaders. Perhaps Verrier is in the Elon Musk camp, though not agreeing with Trump, realizing the potential positives from having open avenues of communication. Verrier’s words to Trump had a stronger tone than that of the others. He pleaded:

“Do not slow down the pace on CAFE standards. We’ve come a long way as an industry and we need to keep going forward. Don’t go backwards and don’t slow down.”

Source: The Detroit News

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31 responses to "Borg Warner CEO Is One Of Few To Ask Trump To Leave Strict CAFE Standards Alone"

  1. ffbj says:

    Well as expected anything that smacks of new technology, that hurts the entrenched legacy economy is looked on with eyes akimbo by our backward looking administration.

    One example would be the withdrawal of funding for the high speed rail in CA. To the tune of $600 million or thereabouts, by the wife of majority leader in the senate.
    Just the beginning.

    1. SparkEV says:

      If it’s truly high speed rail and not cost tax money, I have no problem. But what they’re doing with blended rail that slows to regular rail to bring the cost to “only” 3X what they promised the voters is fraud. This is nothing more than CA politicians paying their due to the cronies who bought them. CA high speed rail must die ASAP before more money is wasted.

      Instead, that money should be used to bring more DCFC. Even with fraction of estimated $70B (ie, $1B), you can have more DCFC than all the gas pumps.

      1. ffbj says:

        Sure, just build some more freeways. That will take care of horrific traffic problems of CA.

        1. SparkEV says:

          If you think freeway is the only other option, you’re stuck in 1950’s, just like slow speed rail is stuck in 1850’s. I wrote why slow speed rail sucks in this blog post.

          http://sparkev.blogspot.com/2015/05/vs-california-high-speed-rail.html

          Underground roadways and barriered roads only for autonomous EV are just couple of examples that comes to mind right off the bat. I was going to write about them, keep getting delayed. I’m sure there are even better ideas by smarter people.

          $70B is a lot of money that can create much better method than rehashing 1850’s technology. Just because other countries are jumping off the bridge doesn’t mean we have to.

          1. ¯\_(ツ)_/¯ sven says:

            SparkEV,

            Have you seen the Velocopter Skyport concept, that would use 12-passenger (autonomous?) battery-powered EV Velocopters to travel between cities in Switzerland 50 meters above the roadways? It looks very efficient and has no need for eminent domain to take land for a right of way. The Skyport stations would be linked to mass transit and car rental/sharing for the remaining leg or last miles of the trip.

            I also really like NYC’s autonomous Airtrain to JFK Airport (from the subway and Long Island Railroad Stations). It’s a fantastic utilization of space, built above the always congested Van Wyck Expressway on monopods that run the along the highway’s center median.

            http://vladimirkagan.typepad.com/.a/6a0120a633cf02970b0120a6b13a14970c-pi

            1. ¯\_(ツ)_/¯ sven says:

              A better/different view of the Airtrain above the Van Wyck Expressway.

              1. Steven says:

                I’ve driven under it many times, though never had the “need” to use it.

            2. SparkEV says:

              I don’t like it, because you still need to get to/from station and not as fast as planes; CA HSR is to cover 400 miles, and this low speed copter won’t do.

              The best for end to end is to have self driving EV, dynamically charged along the way, speed limit of 186,000 miles per second (limited to 125 MPH by “poor” engineering), all of them drafting to increase efficiency. It’ll be cheaper, quicker, more convenient, … Effectively, each lane becomes equivalent to about 10 lanes driven by humans.

      2. guyinacar says:

        You can’t build enough roads to get rid of traffic. Sorry. We’ve proven that in the Northeast for about three generations now. If they installed $70b of DCFC stations, you’d simply have the mother of all EV traffic jams. It’d be sheer gridlock. Far smarter to have a “sharing economy” where you drive your *EV to the garage at train station, and then rent another *EV at the other train station, or just use mass transit if your destination is a major city.

        Nobody proposes owning your own elevator for vertical travel. You just get in, and the magic box on tracks takes you upstairs. For many scenarios, high-speed rail is superior to driving. You just get in, and the magic box on rails takes you sideways. You don’t need to own it.

        The reasons high-speed rail expensive are corruption, “prevailing wages,” and eminent domain. There are solutions to the latter (including selling air rights). The other two are about local politics. But rail itself isn’t the real problem.

        1. SparkEV says:

          Rail, high speed or not, will not solve those traffic jams in CA where most people live in single family homes. Worse, the high speed rail proposed in CA cover roads that are mostly free of traffic.

          Ride sharing would have much better effect on traffic. You can do the math on how much discount you can give for ride sharing with $70B, even if you don’t including the operating costs.

          As for EV traffic jam, that will be quicker than riding the rail from end-to-end. You can give few million free SparkEV for $70B, effectively cutting urban pollution by significant amount. See my blog post on high speed rail, linked above.

          1. ffbj says:

            All speculation. The point is that this will probably kill the train in CA.
            Would HS rail solve all their transportation problems, of course not, though without things will just get worse.

            Japan high speed trains carry around 150 million per year. So how were those people going to travel without it? By foot?

            It’s just the CA Republicans getting their way by using the old saw, how much is it cost taxpayers. Ok, so now we can look forward to lower taxes because high speed rail in CA is dead. Nonsense.

            1. SparkEV says:

              You’re absolutely correct that HSR is pure speculation. You can’t even get decent estimate of the cost. It was sold to the voters for $30B for SF to SD on dedicated high speed rail, now it’s $70B for SF to Burbank on mixed rail, and even that’s getting iffy when they’re talking about drilling through the mountains and buying up land.

              As for ridership, do the math (or read my blog post). There aren’t 150 million riders who will pay $60 each way for SF/Burbank trip, roughly the cost of air travel. Even 30 million riders some pundits say is way too high when you consider the cost and slow inconvenience. Would you take it when it costs more than air travel, slower, packed full of people (30M riders), and you have to drive further from/to station? I wouldn’t.

              It’s not about Republiturds, but about making sense, and passenger rail makes no sense in 21st century. This century belongs to self driving electric cars, and they should spend the money appropriately.

              1. ¯\_(ツ)_/¯ sven says:

                NYC regional rail and subways are a giant bottomless money pit, funded by the lion’s share of toll receipts from three of the busiest bridge and tunnels in the U.S. at $8 a pop each way ($16 round trip). Yet somehow the hundreds of millions of funding the MTa receives from tolls paid by drivers, and the hundreds of millions of dollars the MTA receives from fares and advertising revenue, is never enough to prevent a hundreds of million dollar deficit every year that requires the state government to pay for the short fall.

                1. zzzzzzzzzz says:

                  I don’t see any alternatives to subway/rail in places like NYC. It doesn’t matter if cars are self driving or not, there is not enough space to fit them all on streets at the same time to transport everybody to/from 20+ level buildings. Unless you redesign streets to some 7 level monstrosities.

        2. Steven says:

          And that’s why we have the Northeast Rail Corridor running parallel to I-95.

          (Full disclosure, I live near the largest “Park & Ride” lot in eastern Pennsylvania, and you can access it directly from I-95.)

    2. Dav8or says:

      Whatever it takes to stop the stupid “high speed train” to nowhere. It’s the biggest, stupidest boondoggle this state has ever embarked upon. I think a high speed train would be great for California, but not this idiot one they are trying so hard to ram through before bonehead Brown leaves.

      1. SJC says:

        California High Speed Rail is anything BUT high speed, it is a waste of money. Do local elevated transit to relieve congestion.

  2. Mikael says:

    Strict standards? That is very generous. They are pretty weak from the start. 😛

  3. georgeS says:

    I think we are seeing some significant back pedaling by the Trump administration.

    Before the election it was: “Repeal Obama Care”

    now it is Repeal and replace. That’s good IMO.

    Still too early to know about the travel ban but we have seen significant back pedaling there as well: Visas OK and Iraq off the list.

    I think we will see a softer stance on import tariffs also. Once Trump figures out how much damage it will do to the big three automakers he will back peal on that one also.

    Hopefully Pruitt gets ousted due to conflict of interest.

    1. SparkEV says:

      [MODERATED FOR CONTENT] But putting Dump in same category is stretching it; he’s a senile old nut, not a coin.

    2. (⌐■_■) Trollnonymous says:

      That can apply to many, if not all, politicians that go into office.

      They all grandstand to get in, but then, the simmer down period.

      No matter who is in office Rep or Dem, media pokes at them and others denounce etc…

      Same ol sh1t every 4 years.
      Rinse and repeat….

    3. Mister G says:

      Repeal and replace is a great campaign slogan but now that Trump has to really govern and not campaign…it is really difficult lol. FYI…Obamacare is used by 100% of self employed Americans and entrepreneurs.

      1. Rightofthepeople says:

        Obamacare is used by 100% of self-employed because IT IS MANDATED BY LAW, not because it’s a good program. Repeal it and replace it with access to more flexible health care options and those folks will be fine, plus they will have better, less expensive health insurance.

        1. v says:

          There are no “more flexible health care options” for self employed, or working for small companies for that matter. “Options” are just vaporware in the heads of political drones out of touch with reality.
          Individual policies from private insurance (as before Obamacare) are either many times more expensive, not available at all because of random preexisting conditions, or do not cover half of the things. Which leads to the same old story people do in practice, reducing official income close to zero/bankruptcy and going on Medicaid, letting somebody else to pay the bills.

          The only other option is to pay cash, but private insurance and hospital system in the US raised cash prices up to the roof and beyond comparing to the rest of the world, which is the root of the problem and leads to the same practical option as above.

        2. Mister G says:

          Before Obamacare I was uninsured because health insurance was too expensive, with Obamacare it is affordable. Without mandatory health insurance only sick Americans would buy health insurance, the health insurance industry doesn’t want to go bankrupt if only the sick use health insurance. Think think think

  4. unlucky says:

    Supplier looks to make money off their more recent patents and developments if higher standards drive new technology use.

    Nothing to see here really. Follow the money.

    1. mx says:

      Except Supplier makes a profit AND Society Costs FALL.
      Less Cancer, more clean air, less gas burned, less oil imported, less money to Saudi – Funders of the 911 Terrorists.

      The Good Social Effects of higher MPG standards and EV’s in America is Tremendous.
      -Cleaner Air, less money for Terrorists, and More USA Jobs.

  5. Ron M says:

    Every President since Carter has been taking about Our Addiction to Oil. It took 20 years to finally get new CAFE Standards that automakers said they couldn’t do. Right after it was passed automakers were building and selling these cars that automakers claimed no one could afford and no one wanted.

  6. Independent View says:

    It is always about the money. My take is the Borg Warner bet on the Democrats winning and continued Environmental policy. They invested heavily on components tied to green and cannot easily reverse course, unlike their auto manufacturing customers. The other guys complaining about Mexico is the same thing. They invested in Hillary talking tough on trade, but keeping the status quo.

  7. pjwood1 says:

    AAM is now complaining upward of a million jobs are threatened by CAFE. What you can bet they don’t do is model the positive economic effects of where dollars not spent on fuel go. They somehow get left off, for other organizations to resubmit before the new Administrator.

  8. Nix says:

    Meanwhile, Utah R’s just killed their EV incentive, and in Colorado, a bill to kill the Colorado incentive was just approved by committee. And 3 states have voted to either create or increase yearly EV fees.