FOR IMMEDIATE RELEASE
Administration’s Proposed 54.5 MPG Fuel Economy Standard Wins Praise from Investors
Leading investors praised the Obama Administration’s release today of proposed fuel economy and greenhouse gas emissions standards — standards that will raise automobile fuel economy to 54.5 miles per gallon on average by 2025, up from 27.3 currently.
Ceres and several of its investor partners said the new standards will spur innovation and U.S. job creation, advance public health, and be a consumer-friendly leap forward for an American and global environment threatened by climate change and dependence on oil. The regulations are expected to be finalized next July.
“We’ve long said – and demonstrated with unbiased research – that higher mileage standards are a huge win for our society,” said Ceres President Mindy Lubber. “America needs to move forward now on advanced clean energy solutions that help our economy and consumers, create jobs, cut pollution and help our transportation sector become more globally competitive. The Obama Administration is doing that with these new standards today.”
"Strong vehicle standards will make the U.S. more competitive in the allocation of global investment capital and also reduce our dependence on oil, which undermines our competitiveness,” added Matthew Fitzmaurice, Managing Partner of AWJ Capital Partners, LLC, which manages a global fund of funds and is a member of Ceres’ Investor Network on Climate Risk. “Investment capital now plays on a global stage, and capital represented by hedge funds will find its way into those economies and companies where clear standards exist.”
“As an analyst, I review emissions and efficiency targets not only here in the U.S. but globally, and over the 2020 time frame we see international standards becoming only more stringent,” said Rebecca Henson, of Calvert Investment Management, Inc. “These proposed standards will drive the competitiveness of the U.S. auto industry, which is an important slice of our portfolios. Stricter environmental standards like these will spark innovation and improve the competitive positioning of US automakers.”
Ceres leads a national coalition of major investors and public interest groups working with companies to address sustainability challenges such as global climate change and water scarcity. With several of its partners, Ceres has shown in recent research that strong emissions standards lead to significant jobs growth while lowering pollution and positioning America for global leadership in two of the 21st century’s major economic sectors – transportation and energy efficiency.
For instance, earlier this year Citi Investment Research and Ceres jointly released two new reports: “Fuel Economy Focus: Perspectives on 2020 (Auto) Industry Implications,” and “Electric Vehicles: Perspectives on a Growing Investment Theme.” The reports, prepared as guidance for Citi’s investor clients, found that stricter fuel economy standards will bring economic benefits to the auto industry and particularly the Detroit 3 (GM, Ford and Chrysler) and their domestic suppliers – and that the U. S. electric vehicle industry is poised to grow, driven primarily by policies at many levels of government in addition to rising fuel prices.
The July report “More Jobs Per Gallon: How Strong Fuel Economy/GHG Standards Will Fuel American Jobs” - an economic analysis authored for Ceres by the respected independent economic research firm Management Information Services, Inc. - found that the 54.5 mpg fuel economy standard now proposed by the Obama Administration will create approximately 484,000 economy-wide new U.S. jobs, with 43,000 directly in the auto industry and net job gains in 49 states.
In addition, independent polling commissioned by Ceres and performed by The Mellman Group in April found overwhelming bipartisan support among voters for higher mileage standards in Michigan and Ohio - the historic heart of America’s auto industry.
Under an agreement backed by American automakers and labor, the Obama Administration has been working jointly with the California Air Resources Board on new mileage/greenhouse gas emissions standards to be finalized next year. Ceres President Lubber said that today’s announcement hopefully signifies a firm commitment to strong mileage standards.
“There’s no good reason not to make the final regulations coming next year as strong as they can be,” Lubber said. “The gains vastly outweigh the costs, and the need to modernize our transportation sector and address climate change and oil dependence couldn’t be more urgent. More jobs per gallon isn’t just a slogan, it’s reality.”
Ceres is an advocate for sustainability leadership. Ceres mobilizes a powerful coalition of investors, companies and public interest groups to accelerate and expand the adoption of sustainable business practices and solutions to build a healthy global economy. Ceres also directs the Investor Network on Climate Risk (INCR), a network of 100 institutional investors with collective assets totaling more than $10 trillion. For more information, visit www.ceres.org and www.incr.com.