A backroom battle between non-union Nissan Motor and the powerful United Auto Workers (UAW) could have derailed the Senate’s energy bill passed last night but Nissan won, according to a news agency report.
Go deeper with GlobalData
The Associated Press (AP) said a version of the bill designating tougher fuel efficiency requirements for new cars, pickup trucks and SUVs, seen as more favourable to Nissan, was adopted by the Senate over the union’s complaints that it could cost US jobs.
AP noted that the final bill was a compromise between more stringent law favoured by most Democrats and a softer alternative sought by the UAW, Detroit’s three US car companies and other foreign producers such as Toyota.
The news agency said two Democratic senators from vehicle-making state Michigan – clearly in the UAW’s and US automakers’ corner – scrambled for votes to block the entire bill but came up short while General Motors, Ford and Chrysler all were counting on the UAW’s clout with Democrats to prevail.
According to the report, UAW officials claimed in a letter on Wednesday that the fuel economy compromise, partially crafted by a Republican senator, was designed to help Nissan to the detriment of American workers.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataNissan was the only car maker to support the measure, which would require an average fuel efficiency of 35 miles per [smaller US] gallon for new cars, pickup trucks and sport utility vehicles by 2020, the Associated Press said.
Alan Reuther, the UAW’s legislative director, reportedly wrote that the proposal “would pose a serious threat to American automotive jobs and to efforts to promote the use of alternative fuels but the senator, the ranking Republican on the Senate Commerce Committee, strongly rejected the UAW’s arguments.
According to AP, the UAW opposed the plan because it would assess fuel economy based on a vehicle’s attributes such as size, requiring cars in similar classes to meet comparable standards. That approach would eliminate a provision requiring the standards for passenger cars to be calculated based on both a manufacturers’ domestic and international fleet.
The news agency said the provision was implemented to require automakers to maintain small car production in the US. Automakers typically sell small vehicles to comply with fuel efficiency requirements, offsetting the sales of more lucrative large SUVs.
The report said the UAW had sought language in the bill to ensure that automakers keep making small cars in the US. Without it, Reuther wrote, 17,000 workers who assemble compact cars in Michigan, Ohio, California, Tennessee and Illinois would have their jobs threatened, along with thousands of suppliers.
The UAW also said Nissan opposed provisions to ramp up production of flexible-fuel vehicles capable of running on ethanol blends, the Associated Press reported. Detroit’s three automakers have produced more than 6m of the vehicles and pledged to boost production while Nissan offered a more limited number.
The bill reportedly sets a goal of automakers making half of their vehicles capable of running on ethanol blends by 2015. The bill approved in committee would have set the goal earlier, in 2012.
A lawmaker said “the two Tennessee senators and Nissan were able to basically eliminate … a very strong emphasis on flex-fuel vehicles.”
Nissan spokeswoman Jeannine Ginivan told the Associated Press the issues face more consideration in the [lower] House of Representatives. Nissan was “pleased that we were heard. We know that there are a lot of changes to come and there are a lot of challenges,” she told AP.
