Will U.S. Policy Drive Green-Car Tech Away?

So will the newest, coolest green cars continue to roll out on streets outside the United States?

Eric Fedewa, vice president of global powertrain forecasts at CSM Worldwide, suggests it’s a possibility.

"Primarily, the technology we see overseas has been legislated into existence because of the fuel tax," he said, referring to higher taxes on fuel in Europe. "That’s why we’re seeing higher technology levels in foreign markets. More or less, the reason why we see so much technology in other markets--in Japan, in Europe--[is] because the energy cost is so much higher than here.

Different countries have approached the legislation in different ways, he said, adding that China’s government could simply mandate the technology it wants to have.

"Legislation, in a lot of cases, creates the atmosphere where the vehicle manufacturers can provide solutions," he said. "My view is the automotive industry is full of smart people, and if legislators say, ’Here’s the new standard,’ the engineering departments will step up and come up with the solutions. I view legislation as a good thing. But it’s going to be a little expensive for the vehicle manufacturers to change their products to comply."

Still, even without stricter legislation, energy prices could soon help drive greener cars to the United States, Fedewa said.

"Let’s start with $4-a-gallon gas. I think everybody is reaching the consensus that that’s where we’re headed, because energy supplies are limited and people really want to drive more.… I think as our energy price increases, we’re going to see a lot more technology come into this market because consumers are going to be willing to pay more for that."

Fedewa said CSM Global thinks consumers will begin to consider fuel economy in their car-buying decisions once the energy cost grows to roughly 2 to 3 percent of their disposable income.

"We’re just about there now," he said. "Hybrids and diesels become more attractive. I think we’re going to see more of that in this market because the price of fuel is not going to go down significantly."