Cooperative Research

In light of growing competition from international car companies, the important of automotive jobs to the U.S. economy, and other policy concerns, the President announced a partnership between the federal government and three domestic car companies--Ford, General Motors, and Chrysler--in 1993. The goals of the partnership were to (1) significantly improve U.S. competitiveness in manufacturing, (2) apply commercially viable innovations from ongoing research to conventional vehicles, and (3) develop vehicles that can achieve up to three times the fuel efficiency of comparable 1994 family sedans--or about 80 miles per gallon--by 2004. Overall, GAO found that the partnership is making progress toward its goals, but obstacles remain. GAO estimates that federal research in support of the partnership totaled about $1.24 billion from fiscal year 1995--the first year in which the program was funded--through fiscal year 1999, averaging about $250 million per year. The federal agencies and industry partners supporting the partnership are jointly developing technologies to improve fuel efficiency and manufacturing processes in the automobile industry. Automobile manufactures participating in the partnership reported that their overall research and development primarily focuses on fulfilling consumer preferences and complying with government regulations, while their research done under the partnership is more narrowly focused on developing fuel-efficient vehicles and improving manufacturing processes.

GAO noted that: (1) regarding the partnership's first goal to improve U.S. competitiveness in manufacturing, it is not possible to assess the extent to which this goal is being met because it will take time before the effects of this research can be observed; (2) the partnership has made progress toward its second goal of implementing commercially viable innovations in conventional vehicles; (3) the partnership has focused much of its effort on the third goal of developing technologies for vehicles that can achieve up to 80 miles per gallon, and as of March 2000, all three of the industry partners had released concept cars that demonstrate this ability; (4) while the partnership is making good progress toward the third goal, it still needs to overcome significant technological and affordability obstacles; (5) GAO estimates that federal research in support of the partnership totalled about $1.25 billion from fiscal year 1995 through fiscal year 1999, averaging about $250 million per year; (6) the partnership reflects the sum of research budgets for previously existing programs that are related to PNGV at five federal agencies; (7) also, industry supported the partnership through cost-shared research; (8) the federal agencies and industry partners supporting the partnership are jointly developing technologies to improve fuel efficiency and manufacturing processes in the automobile industry; (9) to improve fuel efficiency, about 84 percent of the total federal research funds included technologies such as advanced diesel engines, fuel cells that directly convert hydrogen and oxygen to electricity, hybrid drivetrains that use both an electric motor and engine, improved use of energy for operating accessories such as air-conditioning as well as vehicle electronics, advanced batteries, lightweight materials, aerodynamic bodies, and tires with less friction; (10) the partnership also dedicated 16 percent of the federal research funds to improving automobile manufacturing by concentrating on working with advanced materials, such as composites and ceramics, improving machining and processing, and manufacturing new components for use in fuel cells; and (11) automobile manufacturers participating in PNGV reported that their overall research and development is largely focused on fulfilling consumer preferences and complying with government regulations, while their research conducted under the partnership is more narrowly focused on developing fuel-efficient vehicles and improving manufacturing processes.