- The Washington Times - Tuesday, November 14, 2006

The nation’s largest automakers told President Bush yesterday they are committed to developing vehicles that use renewable fuels to reduce the country’s dependence on foreign oil.

But the automakers added that if the U.S. automotive industry is to be competitive with Asian imports, the federal government must take a leading role in helping lower the industry’s health care costs, balance the trade deficit with Japan and end tariffs on imported steel.

“It was a very good dialogue — very open, back and forth,” said General Motors Corp. Chairman and Chief Executive Rick Wagoner. “In a number of areas, there was agreement in the things we could continue to work on.”

Mr. Bush added he found “a lot in common” with the auto executives.

“These leaders are making difficult decisions, tough choices to make sure that their companies are competitive in a global economy. And I’m confident that they’re making the right decisions,” Mr. Bush told reporters.

The president, who didn’t take questions from reporters, said the meeting was “the beginning of a series of discussions we’ll have [with the auto industry] — not only with me, but with people in our government.”

The Oval Office meeting, which the automakers had been seeking for months, lasted more than an hour and was attended by Vice President Dick Cheney and other administration officials.

The automakers said they were committed to producing more cars that run on renewable and alternatives fuels. But they said the government must do its part to provide incentives that encourage the manufacture, distribution and availability of renewable fuels.

Mr. Bush said he shares a “mutual desire to reduce our dependence on imported oil.”

Raising the fuel economy of vehicles would help lessen that dependence, but the average fuel economy in the U.S. fleet has been stagnant for years as consumers have opted for more power and luxury rather than fuel economy.

Sen. Barack Obama, Illinois Democrat, this summer helped introduce the Fuel Economy Reform Act of 2006, which calls for the fuel-economy standards for passenger cars and light trucks, which include sport utility vehicles, to increase by 4 percent annually, or about one mile per gallon.

But the executives, who included Ford Motor Co. Chief Executive Alan Mulally and Tom LaSorda, president and chief executive officer of DaimlerChrysler AG’s Chrysler Group, said the president didn’t agree with them on everything, particularly on how to balance trade with Japan.

“It’s our strong conviction that the Japanese yen is systematically undervalued, which helps them to maintain significant trade-balance surpluses in our industry,” Mr. Wagoner said. “I can’t honestly say it appears the president 100 percent saw it that way … . But we agreed to continue the dialogue.”

Mr. Bush met with the leaders just hours before left on a trip to Asia and the Asia-Pacific Economic Cooperation summit in Vietnam.

The president said the message he will give those countries is “just treat us like we treat you … . Our markets are open for your products, and we expect your markets to be open for ours, including our automobiles.”

The auto executives said that upwardly spiraling health care costs are putting them in a serious competitive disadvantage with manufacturers in countries where workers receive government-sponsored health care.

All three automakers spend more on health care per vehicle than on steel, which adds about $1,000 to the cost of a car built by Detroit’s Big Three. GM, the nation’s largest private provider of health care, spent $5.3 billion on health care last year for 1.1 million employees, retirees and their dependents.

In a joint statement released by the three auto executives after the meeting, they urged the federal government to take a “leading role to improve health care and make it affordable and available.”

But the executives insisted they don’t want a government bailout similar to the 1979 measure approved by Congress that helped save Chrysler Corp.

“Are we interested in a bailout? Absolutely not, because we really believe that the action starts with us, and we’re taking the action to create a more competitive business,” Mr. Mulally said.

Instead, the automakers said they advocate health care changes on a national scale, not specific help for the automotive industry.

“Health care is an issue that faces every company, every business, every level of government as well,” Mr. LaSorda said. “So the same problems they have at the federal government, we have here in our industry.”

The executives said the president agreed to study how to lower costs for those with serious illnesses or chronic diseases, which account for about 30 percent of the nation’s health care bill.

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