A panel discussion on changing technology and meeting U.S.-Canada emission and fuel consumption standards. Left to right are: David Adams, president of the Association of International Automobile Manufacturers of Canada, Mark Nantais, president of the Canadian Vehicle Manufacturers’ Association, B.C. Environment Minister Terry Lake and moderator Blair Qualey, CEO of the New Car Dealers Association of B.C.
A lively panel discussion on changing automotive technology to meet new North American greenhouse gases (GHG) and fuel consumption standards by 2016 took place at the 2012 Vancouver International Auto Show. Panel members drove home the message that selling the change to consumers will likely fall into the hands of the auto dealers.
As technology changes, says Mark Nantais, president of the Canadian Vehicle Manufacturers’ Association, there is always “a fear of the unknown” and for the consumer that translates into a “comfort factor.”
Another challenge is that new technology is going to come with a higher price tag. An issue will be vehicle affordability as manufacturers innovate with new technologies to reach for new standards, he says.
The good news, he says, is that once the consumer acceptance is heightened in the marketplace by early adopters and incentives, the demand for these new technologies will be infectious.
Canada and the U.S. have agreed to harmonize GHG emissions and fuel consumption targets for vehicles and light trucks from 2012 to 2016. By the end of the four-year period, 2016 model vehicles will drop fuel consumption by 25 per cent over models produced in 2008 and meet fuel efficiency of 35.5 miles per gallon.
For the benefits of new technology implementation to continue in North America, however, there needs to be continued cooperation in the standards adopted, says Nantais. This provides car manufacturers with market security.
David Adams, President of the Association of International Automobile Manufacturers of Canada said car buyers and manufacturers are “moving into a new world where GHG will be constrained.” The challenges being faced by the manufacturers, who are attempting to adapt, are how far to go with new technology, how fast, and at what price. Car manufacturers face a low return on investment, he says, for the innovations that may reduce GHG emissions but don’t really enhance the car’s performance.
Car manufacturers also deal globally and that will also impact the pace of change. “The world is becoming a smaller place. North America is not as significant a market as many other parts of the world (such as Asia and India),” he says. The decision by Canada and the U.S. to harmonize their emission standards and fuel consumption provides manufacturers with a North American standard now that means a “single continental technology” could go forward more quickly.”
Adams says the new technology often requires infrastructure. “It is the chicken and egg exercise,” he says. Car manufacturers don’t want to invest in new technology until governments commit to proving the infrastructure, yet governments do not want to spend dollars on infrastructure for new technology until the product gains consumer acceptance.
B.C.’s Environment Minister Terry Lake says B.C.’s case of allocating $17 million to a clean energy vehicle program is an example of how government can work with industry. He says the success of the program in bringing new technology to the consumer was made possible because of early adopters of the technology and by making incentives available at the point of sale through the New Car Dealers Association of B.C.
Nantais praises the B.C. program saying that the best results are achieved in delivering new technology to the marketplace when all the stakeholders, including government, are at the table.
