What could be better than exploring the global confluence of car regulations by a serious and quirky business news reporting organization? The answer, of course, is very little. You can imagine my delight when my podcast feed showed the latest episode of NPR's Planet Money podcast, which was adeptly titled Why Cars From Europe and the US Just Can't Get Along.
The timely backdrop of the show is the 2014 New York Auto Show and the show’s hosts question manufacturer representatives about the regulatory requirements which result in completely reengineered vehicles in the US and Europe. Long time readers will note this blog’s continuing coverage of conflicting automotive regulations across the globe.
The Planet Money piece did not break any new ground, but it did expose a larger audience to an otherwise little noticed failure of the free market to create basic efficiencies. The industry’s only glimmer of hope rests with the nascent Transatlantic Trade and Investment Partnership (TTIP). Theoretically, the proposed agreement could lead to the lifting of a whole host of non-tariff trade barriers, such as differing safety standards imposed on automakers. Since these agreements tend to be far reaching, complex and controversial, it is likely that any agreement would start with a broad set of principles and create a mechanism for tackling industry-specific regulations by a joint decision making body. This approach would help all governments involved by being able to support free trade and not have to take any difficult votes that could anger domestic industries.
As always, agriculture seems to be one of the main hurdles. Even if the negotiations touch the much less contentious automotive space, regulators on both sides will be pushing for their rules concerning emissions and safety. In the interim, it’s business as usual, which in this case means spending millions of dollars and euros on reengineering anything from catalytic converters to windshield wipers.
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