General Motors Vice Chairman Bob Lutz called Monday for a national push on the scale of the World War II Manhattan Project to curb imports of foreign oil.

Speaking at Kentucky's eighth annual Global Automotive Conference in Louisville, the design guru said existing proposals to improve fuel economy "by tiny and increasingly expensive increments," such as forcing automakers to increase efficiency by 4 percent per year for the next five years, would be extremely expensive and counter-productive.

No regulators or lawmakers have approached the auto industry for its input on how to improve fuel economy, he said.

He proposed a massive effort, similar to the World War II project that developed the first atomic bomb, to develop technologies and an infrastructure to switch from petroleum fuels to biofuels such as ethanol and bio-diesel.

He said his opposition to incremental changes in fuel economy standards stems from his knowledge of how hard it would be to reach those goals. While he acknowledges that technologies exist to get 25-30 percent improvements, "What they don't tell you is the cost of those systems."

Making cars efficient enough to meet many efficiency proposals would price them beyond the means of many buyers, Lutz said.

Lutz was not the only CAFE critic at the conference. Tim Leuliette, chief executive of automotive supplier Metaldyne, said that in Europe and throughout many parts of Asia, governments have encouraged fuel efficiency through high gasoline taxes.

"Gas hit $8 per gallon in the (United Kingdom) last week," Leuliette said.

Though prices are rising in the United States, he said they aren't yet high enough to discourage consumers from buying gas-guzzling trucks and sport utility vehicles.

From a global competition standpoint, he said, that's a problem because cars designed for this market have no appeal in Asia or Europe.

Considering that Asia is where the growth in the auto industry is taking place, Leuliette said keeping gas prices low here will hurt the global competitiveness of companies such as GM and Ford Motor Co.

GM has said for years that it develops its cars and trucks on a global basis, but Lutz said Monday that many of those statements were empty. While basic structures were agreed to by international committees within the company, regional managers would then alter the vehicle designs for their own uses.

"This whole thing about a global Epsilon platform was a total sham," Lutz said referring to a program that had been intended to design a mid-sized car that could be used in multiple countries using multiple brands.

Development is underway for a new fleet of global cars, but the first vehicle from that initiative is still a few years away, he said.

Lutz said that despite having production, design and engineering shops around the globe, GM has not traditionally used its size to its advantage. That is changing, he promised.

"General Motors has more global resources, more global talent than any other company out there," Lutz said.

CM END SCHOENBERGER

(Robert Schoenberger is a reporter for The Plain Dealer of Cleveland. He can be contacted at rschoenberger(at)plaind.com.)

2007-04-23-GM-ALTFUELS

AP-NY-04-23-07 1521EDT