Due to scheduling conflicts with a certain island nation’s democratic rituals, CSPAN didn’t have a channel to spare for today’s auto safety legislation hearing before the the House Energy and Commerce subcommittee. Which means your faithful blogger is at the mercy of the mainstream media’s digestive process in this matter. Regardless, it seems clear by now that the legislation has driven the industry back to the Republican bosom, after a period of post-bailout estrangement. These newly-re-allied forces collectively raised concerns about a number of key proposals presented by Rep Henry Waxman’s Motor Vehicle Safety Act of 2010, including the un-capping NHTSA fines, privacy issues relating to “black box” event data recorders, new car sale vehicle fees, pedal clearance standards, and increased regulation of an industry with state-owned competitors.
The predominant critique of the cash-for-clunkers programs that have proven so popular in the US and Europe is that they cause unsustainable demand bubbles which cause sales to collapse after they expire. Sure enough, a look at the German market’s Q1 performance shows that the OEMs who most benefited from the program (primarily firms who focus on low-cost cars) are seeing far more significant declines than US-market firms have seen. In the first three months of this year, firms like Hyundai (-40%), Fiat (-58%), Suzuki (-54.6%) and Kia (-49.4%) have been suffering mightily from a hangover caused by the world’s most generous cash-for-clunker program. But the big news isn’t this small-car bust: it’s the fact that these firms’ success last year have caused the percentage of cars on German roads with electronic stability programs (ESP/ESC) to fall.
Arizona Governor Jan Brewer’s administration has officially canceled the state contract that authorized Redflex Traffic Systems to issue automated freeway speeding tickets. The program, started in 2008 by Brewer’s Democratic predecessor Janet Napolitano, will be terminated according to statement issued earlier today to Australian Securities Exchange investors.
Sykesville, Maryland yesterday became the tenth jurisdiction to reject the use of photo enforcement by referendum. The town was to be the first in Carroll County to operate automated ticketing machines after leaders approved an ordinance designating three speed camera zones on February 22. These plans fell through after a group of residents collected more than enough signatures within the thirty-day deadline to put an ordinance repeal on the ballot. Sixty-one percent of Sykesville voters insisted on repealing the use of speed cameras.
Senator Jay Rockefeller (D-WV) has introduced a draft version of his Motor Vehicle Safety Act of 2010. As TTAC has reported, the bill contains a number of provisions, including mandated pedal distances, mandatory brake override, keyless ignition standards, vehicle event data recorder standards, transmission configuration standards, increased penalties for recall delays, and much, much more. Hit the jump for a full description of the measures under consideration.
In the past few weeks, motorists in Arizona, Maryland, Missouri, Oregon, Texas, Washington state and the UK discovered that they had been wrongly issued red light camera and speed camera tickets. In Baltimore, Maryland, for example, the speed camera at the 2200 block of West Cold Spring Lane was set to ticket drivers as if the speed limit were 30 MPH. In fact, the limit for eastbound traffic is 35 MPH. Baltimore officials now must issue refunds after 932 motorists were falsely accused, WBFF-TV reported. The tickets would have been worth $37,280. Only 200 vehicle owners had paid the citation before motorist Brian Struckmeier blew the whistle on the speed limit error.
Vehicle owners ticketed by Maryland speed cameras may find relief after one motorist earlier this month discovered how to beat the system. Peggy Lucero began her legal battle after Affiliated Computer Services accused her of speeding in Gaithersburg on Saturday, November 21, 2009. She did not believe the citation was accurate.
The Missouri state Senate on Monday voted overwhelmingly to ban the use of red light cameras and speed cameras. The measure’s champion, state Senator Jim Lembke (R-St. Louis), had failed in previous efforts to convince his colleagues to end the use of automated ticketing machines. This year, however, he was emboldened by the state supreme court’s decision last month to strike down Springfield’s photo ticketing as illegal (view opinion). Lembke successfully attached the red light camera prohibition to a broader, 106-page transportation measure that included a number of miscellaneous provisions. The vote was 23 to 8 in favor of the ban.
GM’s decision to pay off the loan signaled the automaker did not face “extraordinary expenses,” and that Treasury approved the loan payoff.
“The fact that GM made the determination and repaid the remaining $4.7 billion to the U.S. government now is good news for the company, our investment and the American people,” said Herbert Allison, assistant Treasury secretary for financial stability.
Strictly speaking, GM’s claim to have paid back all US Government loans is correct. The only issue is that GM’s ad touting the payback makes no reference to the fact that it still owes the Treasury upwards of $40b. If that misleads folks, well, apparently the Treasury Department isn’t going to do anything about it. (Read More…)
Virginia Governor Bob McDonnell (R) signed into law last week a proposal that would create an entirely new form of automated ticketing machine, an “airport business” camera. The move followed his approval last month of legislation designed specifically to revive his state’s moribund red light camera program.
Unlike long-wheelbase luxury, the other major theme emerging from coverage of the Beijing Auto Show was hardly unique to the Chinese market. Electric vehicles and talk of automotive electrification have become a highlight of every auto show, with politicians joining executives to push EVs whether the show is in Detroit, Paris or Beijing. And yet, with a power grid that is said to be upwards of 80 percent coal-powered, China isn’t exactly the ideal candidate for an electric car offensive. China’s BYD F3DM was arguably the world’s first plug-in “on the market,” and yet the Shenzhen-based automaker only found 48 fleet sales last year, and still has yet to report a private sale. Conventional wisdom suggests that most Chinese buy at the lowest end of the market (if they’re lucky enough to afford it), while the “coastal elites” tend to spend their hard-earned profits on vehicles that convey prestige rather than eco-optimism. This is a model the global carmakers know how to work with… so why all the talk of EVs in China?
Last week’s announcement that had Chrysler turned a Q1 profit and GM had “repaid” taxpayer loans brought a flurry of political posturing about the success or lack thereof of the auto bailout. With Republicans laying into the auto bailout from several angles, President Obama dedicated his weekly address to a defense of industry assistance. Obama still frames the bailout as an unpleasant necessity, but argues that last week’s news means the chances that taxpayers will recoup their “investment” are improving. And apparently the Treasury agrees. According to the Detroit News, Treasury has revised its estimate of auto bailout losses (not counting GMAC) downwards, from $30.6b to $28b. Progress, sure, but hardly a sign that taxpayers can expect full payback from its state-owned automakers.
Red light camera program troubles continue to grow in South San Francisco, California. On Wednesday, the city council will meet to discuss how to pay the $250,000 bill submitted by the San Mateo County Superior Court to cover the administrative costs of processing $3 million worth of red light camera citation refunds. Because the city failed to properly ratify its contract with American Traffic Solutions, the company in charge of automated ticketing, the 6800 tickets issued between August 14 2009 and February 28, 2010 were declared invalid by the court.
With Senator Chuck Grassley (R-IA) already taking the White House and Treasury to task for possibly helping GM avoid paying the “TARP Tax,” Republican representatives Darrell Issa (R-CA) and Lamar Smith (R-TX) are attacking the auto bailout from another angle, writing a letter to nine automaker CEOs requesting clarification of the negotiating process that led to recently-passed final rules on a ramp-up of greenhouse gas (GHG) emissions standards. In their press release on the issue, Issa and Smith note:
It is unclear whether the Administration used leverage created by the possibility of a taxpayer bailout of GM and Chrysler to secure their cooperation and support for new fuel economy standards. Moreover, there is reason to believe Administration officials used inappropriate tactics to ensure broad based support across the industry. Given the clear conflict-of-interest issues at play, which naturally arise when the government is in a position to pick winners and losers and impact the future viability of private entities, it was imperative that the Administration act with the utmost transparency. Instead, the White House imposed an unprecedented level of secrecy.
Are Issa and Smith on to something, or is this simply a partisan dogpile on an unpopular policy? Hey, this is politics… does it even matter?
While the White House and most of the media spent the last two days parroting GM’s claim that it “paid back” taxpayers, Senator Chuck Grassley was busy writing a letter to the Secretary of the Treasury [letter available in PDF here]. The three-page note opens:
Dear Secretary Geithner:
General Motors (GM) yesterday announced that it repaid its TARP loans. I am concerned, however, that this announcement is not what it seems. In fact, it appears to be
nothing more than an elaborate TARP money shuffle.
No surprises there: TTAC has been all over this rusefor months now. Grassley does sum the situation up nicely, stating that “A debt-for-equity swap is not a repayment,” but the most interesting part of his letter is his theory for why GM and the Administration approved the tax-money reshuffle. Thus far, we’ve assumed that PR was the driving concern in this transparent deception. According to Grassley though, there may be another reason…
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