Threat of Regulation Has Industry Scrambling to Block, Modify Proposals
By STEPHEN POWER
December 11, 2007; Page A18
A new industry is coming under pressure as governments look for ways to make cars use less carbon-belching fuel: tire makers.
The European Union is expected to propose regulations that would set limits on tire rolling resistance, or the force a tire must overcome to move a vehicle. In California, legislators have passed a law calling for similar rules. In Washington, Congress is considering legislation that would create a consumer-information program on tire energy efficiency.
The threat of new regulations has prompted a rush by established tire makers to block the most rigorous proposals. In Europe, tire makers are moving to shape the regulations in ways that would give them an advantage against less technologically advanced rivals.
The focus on tires reflects a broader effort by governments to shift some of the burden of fuel-economy rules away from auto makers, which say job cuts and costly design changes will result from the most ambitious proposals to cut vehicle emissions. This year, the EU eased its proposal for cutting average emissions of carbon dioxide, which contributes to global warming, from new cars in Europe to 18% over five years from the 25% it had proposed earlier.
To make up the difference, the European Commission plans to go beyond more-efficient engines. Among the body's new proposals: increased use of biofuels, more efficient air-conditioning systems in vehicles, and energy-efficiency standards for tires.
In theory, boosting a tire's energy efficiency is relatively easy and inexpensive. As much as 20% of the energy needed to operate a car is tire-related, according to some industry estimates. The lower a tire's rolling resistance, the less energy the car consumes.
A study last year by the National Academy of Sciences in the U.S. estimated that as many as two billion gallons of gasoline and diesel fuel could be saved each year in the U.S. by reducing the average rolling resistance of automobile tires by 10%. That would be equivalent to taking four million cars and light trucks off the road. In Europe, adding low-rolling-resistance tires to cars drives up their production costs by about €20 to €30, or nearly $30 to $45, per vehicle, based on estimates by Credit Suisse Group.
For manufacturers, an easy way to cut a tire's rolling resistance is to reduce the thickness of its tread. The problem, some industry officials said, is that reducing a tire's rolling resistance too much can weaken its traction or shorten the tire's life span.
Germany's Continental AG said its tests indicate that tires designed primarily with low-rolling resistance in mind tend to have longer stopping distances on wet surfaces. The National Academy of Sciences study, however, reported that the safety consequences of reducing tire rolling resistance "are probably undetectable," and that a 10% reduction is "feasible and attainable within a decade" through new tire technologies and improved designs.
This year, the U.S. Senate considered a proposal to require all passenger-automobile tires to meet low-rolling-resistance standards. The tire industry warned it would have to make tires that wear out more quickly, piling up more used tires in scrap yards.
The industry coalesced around a proposal to create a national system for rating tires on energy efficiency, leaving it up to consumers and car companies to decide which tires to buy. That is part of broader legislation being considered by Congress that would also raise automobile fuel-economy standards.
"Congressional leaders were telling us that there's a lot of concern about fuel use and that you guys need to start saying something other than 'no' to doing something," said Dan Zielinski, a spokesman for the Washington-based Rubber Manufacturers Association.
Mr. Zielinski's group had less success dissuading California legislators from passing a law that requires state regulators to set energy-efficiency standards for tires. Before imposing new standards, however, state regulators are required under the law to show they won't "adversely affect" tire safety or California's effort to manage scrap tires or tire life span. Although California's law raises the prospect of a de-facto national standard, industry officials are skeptical the state will ever be able to implement such standards.
"We believe the thresholds they need to overcome are not likely to be surmountable," Mr. Zielinski said. A spokeswoman for the California Energy Commission said the agency is "confident that we can work with the tire industry to establish tire efficiency standards that meet our mandates."
In Europe, tire makers have concluded new regulations are inevitable. Unlike the U.S., the EU is party to the Kyoto Protocol, the international treaty that sets mandatory targets for cutting global greenhouse-gas emissions.
Rather than try to block new EU standards, Western and Japanese tire makers are pressing regulators not only to set standards for rolling resistance, but also to establish new requirements for braking performance and to mandate consumer-friendly labels that would grade tires on energy efficiency and how well they perform on wet or slippery surfaces.
By taking on mandates, the industry's more established players, such as Continental and Japan's Bridgestone Corp., could gain an edge against tire makers from India and China, which tend to spend less on research and development, industry analysts said.
France's Michelin SA is touting the fuel-saving potential of its "green tires." The company recently started a global ad campaign for its most energy-efficient tires.
This year, Michelin got a major boost when French car maker PSA Peugeot-Citroen SA adopted its fourth-generation "Energy Saver" tire for the new Peugeot 308 hatchback. Michelin officials say the tires will cut the car's carbon dioxide emissions by four grams per kilometer, equal to a reduction of about one metric ton of carbon dioxide during the life of the vehicle. The tire's braking distance on wet roads also is about 10 feet shorter than the previous-generation tire. Michelin charges auto makers about 10% more for the tire than it does for a conventional tire, though specific price levels depend on the volume of the car maker's order, a Michelin spokesman said. Price levels for the replacement market haven't been announced yet.
"We know how to make a tire which can brake short and at the same time is fuel efficient," said Thierry Coudurier, president of Michelin's passenger-car and light-truck tire division. "We don't think all of our competitors are able to do that."
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