PARTNERSHIP FOR A NEW GENERATION OF VEHICLES

A Declaration of Intent

SUMMARY

USCAR, a partnership of Ford, Chrysler, and General Motors, is pleased to join with the President on behalf of the federal government, in this Declaration of Intent to pursue a unique research and development effort. The goal is the development of commercially-viable vehicle technology that, over the long-term, can preserve personal mobility while further reducing the impact of cars and light trucks on the environment, and reducing dependence on imported petroleum. Such a vehicle, that meets applicable safety and emission standards, and provides the performance, affordability, and comfort the public has come to expect from American automobiles, can help assure world leadership for the U.S. industry.

SHARED VISION

On February 22, 1993, President Clinton announced a comprehensive new initiative "Technology for America's Economic Growth, A New Direction to Build Economic Strength," intended to move America forward to a stronger economy, a cleaner environment, more competitive business, more effective government, and technological leadership in critical fields. As part of his initiative, the President focused on the U.S. auto industry and he proposed linking the research efforts of the various government agencies with those of the U.S. auto manufacturers and working together to design programs to develop prototype vehicles which reach the goals described below.

The U.S. automobile industry has made a major commitment to research and innovation in the past, and the results are visible in the increasing productivity of its employees and plants, and in attractive products offered at competitive prices around the world. Looking to the future, the new challenges of international competition and the costs of meeting increasingly stringent environmental standards can best be met if government and industry work together to develop a new generation of automobiles.

We have made considerable progress in emissions and fuel economy, but rapid development of new technology is essential to pave the way for major further gains. Breakthroughs are possible in basic research in areas such as combustion, light-weight materials, and alternative sources of fuel.

This program represents a fundamental change in the way government and industry interact -- a shift to a new era of progress through partnership and cooperation to address the nation's goals, rather than through the confrontational and adversarial relationship of the past. This new public policy of partnership and cooperation will permit dedication of private and public resources to programs designed to achieve major technological breakthroughs that can make regulatory interventions irrelevant.

OVERVIEW

The automobile industry recognizes that its future depends on world-class productivity, and the production of affordable, high quality, safe, environmentally sensitive products. But this industry faces continued challenges in the years ahead. International competition is growing. The new Clean Air Act amendments and the California standards set ambitious new goals for reduced emissions. Reductions in greenhouse gas production and imported petroleum demand over the long term, may require a number of actions, in combination, to reduce fleet fuel consumption.

This program is designed to address key new technical options for vehicles, including: 1) development and introduction of substitutes for petroleum used in transportation -- particularly fuels from renewable resources, and 2) increased efficiency in automobiles and light trucks.

We expect the program will mark the beginning of a new era of progress through partnership. By this document, USCAR and the government declare their separate but coordinated plans toward the achievement of specific goals to meet the nation's need and desire for tomorrow's clean and efficient cars.

PROGRAM GOALS

The program strategy is designed to create a balanced research portfolio capable of pursuing a number of goals simultaneously. The program should:

There is no easy way to meet all of the goals just described. Making progress in all areas simultaneously is a challenge of historic proportions. The federal government and the automobile manufacturers will work actively together to coordinate the research portfolios of industry and the government to facilitate significant advances on all of these goals at the same time.

Both industry and government leaders agree that cooperation and combining resources is the best way to make significant progress. Industry will provide leadership in identifying research opportunities that can meet the goals of this Initiative and in producing and marketing new vehicle technologies once their commercial viability has been demonstrated.

The federal government, working with fuel producers, will promote the accelerated development and production of alternative fuels. The vehicle manufacturers, to the extent practicable and appropriate, will ensure vehicle compatibility with new fuels.

RESEARCH GOALS

The goal of this program is embodied in three independent, but related, research initiatives. The first will explore technologies that improve the process of designing, manufacturing, and producing vehicles, and that permit greater flexibility in incorporating new production processes and products. The second will develop a range of technologies that improve fuel economy and performance and reduce the emissions associated with conventional vehicle designs. The third will pursue development of a revolutionary class of efficient, environmentally friendly, commercially viable vehicle.

The specific goals of these three initiatives are as follows:

1. Pursuing advances in manufacturing techniques that can reduce production costs and product development times for all car and truck production. These advances include such technologies as: use of high-speed computers for efficient design and testing of products and components before they are fabricated; advanced materials and material fabrication techniques; efficient, flexible manufacturing equipment; and advanced sensors and control systems to optimize the performance of complex assembly and parts management.

These technologies are critical to developing commercially feasible vehicles. Advances in manufacturing technologies can ensure that new concepts can be put into production quickly and with minimal delay. New production technologies will enable the industry to make effective use of advanced materials that can reduce production time, reduce costs, increase safety, increase recyclability, and increase fuel efficiency because of reduced weight. Advanced design and simulation can ensure optimum aerodynamic performance.

2. Pursuing advances in vehicles that can lead to increases in the efficiency of standard vehicle designs. Research will focus on technologies that reduce the demand for energy from the engine and drive train (advanced materials, improved aerodynamics, improved tires, reduced friction), as well as improved engine and transmission efficiency. For example, research will focus on advanced catalysts capable of making practical the introduction of lean-burn engines.

Throughout the research program, the industry commits to apply those commercially viable technologies resulting from this research that would be expected to significantly increase vehicle fuel efficiency.

3. Developing a revolutionary new class of efficient, environmentally friendly vehicle that will meet the consumers' needs for safety, quality, performance, utility, and affordability. Through cooperative research over the next 3 to 4 years, the partnership expects to identify the most promising technologies for meeting the multi-dimensional program goals that will push the theoretical limits of energy efficiency. Each cooperative research and development project which will be part of the Initiative will have specific goals and timetables to support the overall objective of developing a new generation of vehicle.

Assuming maximum effort on the part of industry and government, the goal of the program is to develop a vehicle which could achieve fuel efficiencies up to three times today's comparable vehicle, while at the same time cost no more to own and drive than today's automobile, maintain performance, size, and utility of comparable vehicles, and meet or exceed safety and emission requirements.

As stated above, throughout the research program the industry commits to apply, as they become commercially viable, those technologies resulting from the research program that would be expected to significantly increase vehicle fuel efficiency. But it is recognized that reaching the goal of fuel efficiencies up to three times today's comparable vehicle may be dependent upon development of revolutionary new approaches, such as fuel cells, to replace the internal combustion engine.

The development of fuel cells, as well as new generation batteries, ultra-capacitors, and other technologies may be beyond what is reasonable and realistic to expect to be achieved and it is recognized that the more radical the technology necessary to reach this goal, the less certain its achievement and the timetable in which it can be achieved. Nevertheless, the goal is to develop a concept vehicle during the 1990's and a production prototype within approximately a decade. It is expected that government laboratories will make major contributions, concentrating on areas where technology is unproven, and there is presently limited consumer demand as a result of the low price of fuel.

These program and research goals are aggressive. The parties agree there is no certainty that these technologies can be developed while simultaneously achieving the other program goals of maintaining affordability, emissions reduction, utility, performance, and safety. The parties also recognize that significant concomitant infrastructure changes also may have to occur to enable the industry to commercialize this new class of vehicle. Nonetheless, the parties commit their best efforts to the achievement of the goals of this Declaration of Intent and to the rapid application of any developed commercially viable technology.

While the relative proportions of government and private funding will vary depending on the government program (if any) utilized to support a particular aspect of the Initiative, and on the specific project involved, it is envisioned that there will be significant cost sharing by industry and government. The proportion of federal funding will be higher for high-risk projects where the outcome is uncertain and that of industry funding will be higher for technologies with a clear, near-term market.

Focusing research and development activities around these objectives will help maintain the technical leadership and global competitiveness of the nation's automobile industry. It will secure and create U.S. jobs in this sector, which are a vital source of quality employment and tax revenues. The industry and government parties hereby signal their commitment to work together to design and carry out efficient, flexible research programs to achieve the goals of the Initiative. The federal government also hereby intends to use the power of federal vehicle procurement to support the goals of this Initiative, and to encourage state government and other groups to take similar actions to ensure the success of this Initiative.

NEXT STEPS

Several steps will be taken immediately:

1) Industry and government officials will be named immediately to establish a mechanism for determining program goals and a process for developing a longer range plan to achieve the program goals. They will address issues including the need to protect U.S. technology, development of milestones and deliverables, and establishment of a common information base that can be used to develop policy options. The government and the industry will broadly solicit technology sources that have a potential to advance the goals of this Initiative.

2) Industry and government will immediately name teams of their scientists and engineers who will develop coordinated lists of specific research and development projects to meet the research and development goals and establish priorities.

3) Within 60 days, one or more agencies of the federal government, in consultation with the other parties to this Declaration of Intent, will put forward generic procedures for Cooperative Research and Development Agreements (CRADAs) that will facilitate the government's quick response to research and development needs identified under the Initiative. These procedures will cover research and development conducted in federal laboratories. They will also provide a consistent approach to issues such as the availability of federally funded research to the broader research community. A management plan will be developed by the Departments of Energy and Commerce that will protect industrial proprietary interests and facilitate compliance with statutory requirements. This general agreement will be designed to permit the expedited beginning of work on projects under this Initiative and other industry/government initiatives; ideally, no more than 30 days should pass before work can begin.

4) The Administration commits to aggressively pursue identified research and development projects through management of research programs and assets in all federal agencies and national laboratories. The Administration will assign a high priority to research in this area and seek increased funding, as appropriate, to support research activities identified through this program.

5) Because multiple federal agencies are involved, the government will identify a focal point to coordinate and channel research and funding intended for this program.

6) The research portfolio will form a comprehensive research effort to achieve the goals of the Initiative. Topics may include:

The auto industry and the federal government will immediately begin the development of a multi-phase plan to identify milestones and deliverables to achieve the goals of this new class of vehicle. The Initiative will include the timely development of a detailed, long-term research implementation plan including as components the research plans of industry and government agency participants in the Initiative. This will include a detailed description of the proposed research and estimates of required expenditures.

7) Analytical teams consisting of staff of the relevant federal agencies and representatives of industry will work to develop a common information base that can be used to evaluate options for meeting national environmental and other goals.

8) An unbiased organization acceptable to both the industry and the government, such as the National Academy of Sciences, will be asked to set up a peer review process to comment on the technologies selected for research and on progress made.

SCOPE OF THIS DOCUMENT

As outlined by this Declaration of Intent, the parties expect many individual contracts, grants, CRADAs, and other project agreements to be undertaken by industry, or between industry and government, in support of the goals of the program. Similarly, the government expects and plans to utilize its resources, including its research and development programs, in a manner that will foster the goals of this program. However, neither this Declaration of Intent nor the program it is designed to initiate, is intended as a commitment of specific government or private funds or resources. Such contractual and decision making functions will continue to be carried out through contracts, agreements, and other arrangements made under and subject to, all applicable laws and regulations. It is intended and hoped that other relevant industries and groups will also declare their intent to work in partnership with the government and the automotive industry to help achieve the goals of this Initiative.