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GM's Lutz urges fuel tax to boost sales

The United States needs to adopt an energy policy that considers consumers and what they pay for fuel, says General Motors Corp. vice-chair Bob Lutz.

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DETROIT – The United States needs to adopt an energy policy that considers consumers and what they pay for fuel, says General Motors Corp. vice-chair Bob Lutz.

Lutz said consumers won’t buy expensive environmentally friendly autos unless fuel costs are high enough to provide an incentive. Gasoline prices have fallen after hitting a record high last year .

Consumers and the industry need some idea about long-term price of fuel and the government can assist, he told journalists at the North American International Auto Show.

“There needs to be an energy policy that puts the consumer into the equation and actually gets people to think about what kind of vehicle they should be buying the next time around,” he said. “At a $1.50 (U.S. a gallon) gasoline, nobody is going to buy all these necessarily, more expensive, high-technology vehicles.”

Lutz admitted that as the United States economy recovers, fuel demand will increase next year and push up prices again., But he said that would not solve a fundamental market problem.

“In my mind, that in no way diminishes the need for a sound energy strategy,” he stressed. “Somebody at the federal level has got to decide what fuel should reasonably cost if we want to start incentivizing Americans.

“Because what we have right now is the equivalent of combatting obesity by forcing the clothing manufacturer to produce only small sizes. That’s what we got right now.”

Lutz also acknowledged that he is not the first auto executive to advocate a gas tax that would give motorists an incentive to buy autos that are powered by alternative forms of energy.

He said in the current marketplace the auto industry gets endless criticism for producing the wrong products as fuel prices bounce up and down.

Lutz made his remarks as GM introduced a number of new fuel-efficient models.

Today, GM will show off its highly-publicized Volt electric car that is scheduled to enter the market late next year. The company has not released sticker prices yet.

GM is also showing off a luxury spinoff of the Volt, a rechargeable concept vehicle dubbed the Cadillac Converj that like the Volt is being designed to run for 64 kilometres on battery power alone.

With files from the Star’s wire services

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